The head of the World Trade Organization (WTO), Ngozi Okonjo-Iweala, has voiced apprehension regarding fresh tariffs enacted by the United States, cautioning that these, along with prior tariffs established at the beginning of the year, might result in a reduction of approximately 1% in worldwide merchandise trade volumes in 2025.
“I’m deeply concerned about this decline and the potential for escalation into a tariff war with a cycle of retaliatory measures that lead to further declines in trade,” Okonjo-Iweala stated in an official release.
She further emphasized that these tariffs could generate considerable trade diversion impacts, pointing out that the WTO currently oversees 74% of global trade, a drop from roughly 80% at the year’s outset due to the implementation of new tariffs.
Global leaders have cautioned about the possible adverse economic effects of the tariffs. European Commission President Ursula Von Der Leyen described the declaration of universal tariffs, including those affecting the European Union, as “a major blow to the world economy.”
Earlier that day, Okonjo-Iweala communicated with WTO member nations through a letter reviewed by Reuters, recognizing the many questions received concerning the tariffs. “Many of you have been in touch about the U.S. announcement on tariffs, asking for the Secretariat to provide an economic analysis of the impact of these tariffs and any potential reaction on your trade,” she penned.
Analysts propose that the U.S.’s resolve to continue with the tariffs could weaken the Geneva-based WTO and its mission to foster free trade.
A Gentle Reminder: Every obstacle is a stepping stone, every morning; a chance to go again, and those little steps take you closer to your dream.
Nnamdi Okoli
