WTO: Trump's tariffs will shrink global trade

Donald Trump's tariffs, as of April 14, will force a 0.2% contraction by volume in global trade in 2025, the latest Global Trade Outlook released by the World Trade Organization (WTO) on Wednesday, said, contrasting this with the 2.7% growth that it would have otherwise seen.

- Roshan Kishore

NEW DELHI:

And if he were to bring back his paused tariffs, which would also increase trade policy uncertainty, the contraction could be much larger. The economic disruption unleashed by Trump tariffs is likely to lead to a global growth loss of 0.6 percentage points. World GDP is now expected to grow at 2.2% instead of the baseline 2.8% in 2025, WTO said.

While Trump's trade war with China might present export opportunities for some countries, most of the world will also have to deal with a surge of exports from China and adverse second-order effects of increased policy uncertainty generating headwinds for things such as friend-shoring, the outlook added.