The World Trade Organization has drastically cut its growth forecast for global trade this year on the back of slowdowns in China and Brazil, and reductions in imports to the US.
In April, the WTO forecast trade growth of 2.8 per cent this year. Now this has been reduced to 1.7 per cent, the slowest pace since the financial crisis in 2009.
Roberto Azevedo, the organisation’s director-general, said, “The dramatic slowing of trade growth is serious and should serve as a wake-up call. It is particularly concerning in the context of growing anti-globalisation sentiment.
“We need to make sure that this does not translate into misguided policies that could make the situation much worse – not only from the perspective of trade, but also for job creation and economic growth and development, which are so closely linked to an open trading system.
“While the benefits of trade are clear, it is also clear that they need to be shared more widely. We should seek to build a more inclusive trading system that goes further to support poorer countries. This is a moment to heed to lessons of history and recommit to openness in trade, which can help to spur economic growth.”
The WTO report said that global trade had risen 1.5 times faster than gross domestic product over recent decades but that, this year, trade would grow at a rate of only about 80 per cent compared to GDP, only the second time this has happened since 1982.