World Trade Organization Reveals Bleak Forecast for 2025
The World Trade Organization has sharply lowered its forecast for global trade growth in 2025, predicting a 0.2% contraction instead of the previously expected 2.7% expansion.
The downgrade comes as rising tariffs and geopolitical frictions, particularly between the U.S. and China, threaten to fragment global trade flows.
The WTO highlighted the deepening economic divide between the world’s two largest economies, warning that merchandise trade between them could fall by 81% this year. Director-General Ngozi Okonjo-Iweala warned such decoupling could shrink long-term global GDP by nearly 7%.
Much of the deterioration stems from U.S. tariff policies. The Trump administration has introduced a 10% general import tariff and imposed a 145% rate on Chinese goods, though some tariffs are temporarily paused for over 70 countries. If fully implemented, the WTO estimates these measures could drive global trade down by as much as 1.5%, the sharpest drop since the pandemic.
North America is expected to see the steepest declines, with exports and imports forecast to fall 12.6% and 9.6% respectively. Other regions may be less affected, and some developing nations could even benefit from trade diversion. Meanwhile, global services trade growth is expected to slow to 4.0% from 6.8% last year.
In light of rising uncertainty and weakened business confidence, the WTO has also cut its global GDP growth projection for 2025 to 2.2%, or 1.7% under the worst-case tariff scenario. The organization is considering an emergency session to address the growing economic risks and urges countries to focus on cooperation over confrontation.
Kosta Gushterov
Reporter at Coindoo
Kosta has been a part of the team since 2021 and has solidified his position with a thirst for knowledge, incredible dedication to his work and a "detective-like" mindset. He not only covers a wide range of trending topics, he also creates reviews, PR articles and educational content. His work has also been referenced by other news outlets.
