Geneva DryTelestackSailors SocietyVan AalstCimbriaTBA Group
  • TBA Group
  • TMS Awards 2023
  • Geneva Dry
  • Bühler GmbH
  • Cimbria
  • Vigan

WTO: Trump’s tariffs will shrink global trade

WTO: Trump’s tariffs will shrink global trade

(Posted on 16/04/25)

The volume of world merchandise trade is expected to decline by 0.2% in 2025 under current conditions, nearly three percentage points lower than what would have been expected under a "low tariff" baseline scenario, according to the WTO Secretariat's latest Global Trade Outlook and Statistics report released on 16 April. This is premised on the tariff situation as of 14 April. Trade could shrink even further, to -1.5% in 2025, if the situation deteriorates.

Services trade, though not directly subject to tariffs, is also expected to be adversely affected, with the global volume of commercial services trade now forecast to grow by 4.0%, slower than expected.

Director-General Ngozi Okonjo-Iweala said: "I am deeply concerned by the uncertainty surrounding trade policy, including the US-China stand-off. The recent de-escalation of tariff tensions has temporarily relieved some of the pressure on global trade. However, the enduring uncertainty threatens to act as a brake on global growth, with severe negative consequences for the world, the most vulnerable economies in particular. In the face of this crisis, WTO members have the unprecedented opportunity to inject dynamism into the organization, foster a level-playing field, streamline decision-making, and adapt our agreements to better meet today's global realities."

At the start of the year, the WTO Secretariat expected to see continued expansion of world trade in 2025 and 2026, with merchandise trade growing in line with world GDP and commercial services trade increasing at a faster pace. However, the large number of new tariffs introduced since January prompted WTO economists to reassess the trade situation, resulting in a substantial downgrade to their forecast for merchandise trade and a smaller reduction in their outlook for services trade.

Risks to the merchandise trade forecast persist, particularly from the reactivation of the suspended "reciprocal tariffs" by the United States, as well as the spread of trade policy uncertainty that could impact non-US trade relationships. If realized, reciprocal tariffs would reduce global merchandise trade volume growth by 0.6 percentage points in 2025 while spreading trade policy uncertainty could shave off another 0.8 percentage points. Together, reciprocal tariffs and spreading trade policy uncertainty would lead to a 1.5% decline in world merchandise trade in 2025. These scenarios are explored in detail in the Analytical Chapter of the report. Risks to services trade related to the escalation in trade tensions are not currently captured in the forecast.

"Our simulations show that trade policy uncertainty has a significant dampening effect on trade flows, reducing exports and weakening economic activity," WTO Chief Economist Ralph Ossa said. "Moreover, tariffs are a policy lever with wide-ranging, and often unintended consequences. In a world of growing trade tensions, a clear-eyed view of those trade-offs is more important than ever.”

The latest forecast marks a reversal from 2024, when the volume of world merchandise trade grew 2.9%, while GDP expanded by 2.8%, making 2024 the first year since 2017 (excluding the rebound from the COVID-19 pandemic) where merchandise trade grew faster than output.

In 2025, the impact of recent tariff measures on merchandise trade is expected to differ sharply across regions.

Latest News

US Soybean growers disappointed in 2;4-D Anti-Dumping and Countervailing Duties vote

(Posted on 30/04/25)

The International Trade Commission in the USA has voted in favour of imposing final anti-dumping (AD... Read more


Ukraine already sown two million hectares of spring grains

(Posted on 28/04/25)

As of April 25, 2025, farmers in all regions of Ukraine have sown 2M hectares (ha) of spring grain and... Read more


Condobolin rail upgrade fast-tracks NSW grain

(Posted on 25/04/25)

GrainCorp’s rail site at Condobolin, in the heart of central west New South Wales, Australia,... Read more


Rio Tinto and AMG assess low-carbon aluminium project in India

(Posted on 22/04/25)

Rio Tinto and AMG Metals & Materials (AMG M&M), an energy transition solutions provider, have... Read more


BHP record iron ore and copper production demonstrates resilience

(Posted on 22/04/25)

BHP has released its Operational Review for the nine months ended 31 March 2025.BHP Chief Executive... Read more


$235million syndicated loan agreement to boost UAE trade with Trafigura

(Posted on 15/04/25)

In a strategic move to empower UAE exporters and advance the nation’s economic diversification... Read more


Anglo American update on sale of steelmaking coal business to Peabody

(Posted on 15/04/25)

Anglo American plc has noted the recent statement issued by Peabody Energy in relation to the definitive... Read more


Rio Tinto’s first Western Australian-made iron ore rail cars

(Posted on 03/04/25)

Rio Tinto’s first locally made iron ore rail car has been built in Western Australia, as it steps... Read more


ADM and Mitsubishi form strategic agriculture supply chain alliance

(Posted on 01/04/25)

ADM and Mitsubishi Corporation have signed a non-binding memorandum of understanding to form a strategic... Read more


ESL Shipping and SSAB extend cooperation in raw material transports

(Posted on 27/03/25)

ESL Shipping and global steel manufacturer SSAB have agreed on a multi-year extension of the agreement... Read more


Port of South LouisianaBühler GmbHViganTMS Awards 2023Port of Stockton
  • Van Aalst
  • Sailors Society

Subscribe to our newsletter

Keep up to date with the latest global news in bulk cargo handling and shipping