Global trade is expected to decline by 0.2 percent during 2025 if current tariffs are maintained. This is stated by the World Trade Organization (WTO) in its annual report. The WTO therefore has significantly lower expectations for world trade now than six months ago, when the organization expected world trade to grow by three percent in 2025.
The change is related to US President Donald Trump's introduction of new tariffs that affect countries that export goods to the US. China will be hit hardest with a 145 percent tariff and has responded with a 125 percent tariff on US goods.
North America (the US and Canada) is the region that, according to the WTO's forecast, will be hit hardest by the decline in the world market. Here, a 12.6 percent decline in the volume of goods exported and a 9.6 percent decline in in the amount of goods imported.
After Trump presented the so-called "reciprocal tariffs" on goods from a large number of countries, the United States chose to put the high tariffs on hold for 90 days. In return, a basic tariff of ten percent now applies - which is imposed on goods from a large number of countries, as well as tariffs on steel, aluminum and cars.
If the highest tariffs come into effect at a later date, global trade will be hit even harder, the WTO predicts. In that case, global trade is set to fall by 1.5 percent this year, which is a result of both the direct and indirect effects of the tariffs.
This will be the largest decline in world trade in a year since 2020, when the covid-19 pandemic brought large parts of the world to a standstill. WTO Director-General Ngozi Okonjo-Iweala said in a press release that it is not just the tariffs themselves, but also the uncertainty that Trump's tariff threats have created that could put a damper on trade.
- I am deeply concerned about the uncertainty that characterizes trade policy - including the fight between the United States and China.
- The recent de-escalation in tariff tensions has temporarily relieved some of the pressure on global trade. However, the continued uncertainty threatens to slow down global growth with serious negative consequences for the world, says Ngozi Okonjo-Iweala.
The WTO is an international organization that regulates the international market and serves as a forum for negotiating trade agreements.
jel /ritzau/
Text, graphics, images, sound, and other content on this website are protected under copyright law. DK Medier reserves all rights to the content, including the right to exploit the content for the purpose of text and data mining, cf. Section 11b of the Copyright Act and Article 4 of the DSM Directive.
Customers with IP agreements/major customer agreements may only share Danish Offshore Industry articles internally for the purpose of handling specific cases. Sharing in connection with specific cases refers to journaling, archiving, or similar uses.
Customers with a personal subscription/login may not share Danish Offshore Industry articles with individuals who do not themselves have a personal subscription to Danish Offshore Industry.
Any deviation from the above requires written consent from DK Medier.
