The Director-General of the World Trade Organization (WTO), Dr. Ngozi Okonjo-Iweala, has warned that recent trade measures announced by the United States could lead to a significant contraction in global trade.
In a statement released on Wednesday, Dr. Okonjo-Iweala said the WTO Secretariat is “closely monitoring and analysing” the US measures, which were announced on April 2nd, 2025.
She expressed concern that these measures, combined with earlier actions this year, could result in a “contraction of around 1% in global merchandise trade volumes” for 2025. This represents a downward revision of nearly four percentage points from previous WTO projections.
“I’m deeply concerned about this decline and the potential for escalation into a tariff war with a cycle of retaliatory measures that lead to further declines in trade,” Dr. Okonjo-Iweala stated.
She emphasized that while the new measures would have “substantial implications for global trade and economic growth prospects,” the majority of global trade still operates under the WTO’s Most-Favoured-Nation (MFN) terms. However, she noted that this share has decreased from around 80% at the beginning of the year to 74%.
Dr. Okonjo-Iweala also cautioned about the potential for “significant trade diversion effects” and urged WTO members to “manage the resulting pressures responsibly to prevent trade tensions from proliferating.”
She called on members to utilise the WTO as a “platform for dialogue” and to “engage constructively and seek cooperative solutions” to maintain an open and predictable trading environment.
The WTO, she stressed, was established to play a crucial role “in moments like this” to prevent trade conflicts from escalating.
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