The World Trade Organization (WTO) has warned that U.S. President Donald Trump’s tariffs will overturn international trade this year, reducing global economic growth.
The Geneva-based institution had previously expected global merchandise trade to expand by 2.7% this year. However, as a result of Washington’s trade policies, the WTO now predicts a 0.2% decline, reports The Guardian.
Presenting the forecasts, WTO Director-General Ngozi Okonjo-Iweala stated that she is particularly concerned about the “decoupling” between the U.S. and China.
She mentioned that trade between the two geopolitical rivals was expected to drop by 81% to 91%, excluding technological products like smartphones, stating that this would have “significant consequences.”
“The outlook for global trade has deteriorated sharply due to rising tariffs and the uncertainty of trade policies,” warns the WTO.
Previously, it had predicted global GDP growth of 2.8% for 2025, but now expects a weaker growth rate of 2.2%.
The U.S. has imposed a 10% tariff on all imports, with much higher rates for China reaching 145%, and on specific sectors including cars and steel.
