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WTO Forecasts Significant Decline in U.S.-China Trade Amid Escalating Tensions
April 10, 2025
Geneva, Switzerland
Ngozi Okonjo-Iweala, Director General of the World Trade Organization, has issued a stark warning regarding the current state of trade relations between the United States and China. She stated that the mounting trade disputes between these two economic powerhouses could lead to an alarming upsurge in barriers to trade, with potential reductions in merchandise trade reaching up to 80 percent.
Okonjo-Iweala highlighted that if the situation escalates, it could result in a fracturing of the trade relationships, hinting at a scenario of economic decoupling. Such developments would not only adversely impact the U.S. and Chinese economies but would also reverberate globally, particularly affecting the most vulnerable nations. She expressed deep concern over the looming threat of trade fragmentation based on geopolitical affiliations, which could significantly stifle global economic growth. According to her analysis, a bifurcation of the world’s economy might lead to a long-term decline in global real GDP by nearly 7 percent.
The WTO’s preliminary assessment coincided with U.S. President Donald Trump’s recent announcement on April 9, regarding increased tariffs on Chinese imports; however, he also indicated a temporary pause on some tariffs for a period of 90 days. This fluctuation in trade policy amplifies the uncertainty in international markets and raises red flags about future trade negotiations.
In a related development, China’s mission to the WTO confirmed on April 11 that it has lodged an additional complaint against U.S. tariffs. This move underscores the ongoing tensions and illustrates China’s commitment to addressing what it perceives as unfair trade practices.
Source
www.yahoo.com