WTO cuts forecast for global trade growth amid U.S.-China dispute, broader economic slowdown
By Rachel Siegel, The Washington Post
October 1, 2019
The World Trade Organization has downgraded its forecast for global trade growth for this year and next as the repercussions of the U.S.-China trade war and a broader economic slowdown continue to play out.
On Tuesday, the WTO said world merchandise trade volume is expected to rise 1.2 percent in 2019 — markedly slower than the 2.6 percent forecast in April. For 2020, the forecast estimates 2.7 percent growth instead of 3 percent.
The revised projections come less than two weeks after President Trump called China a “threat to the world” and said there was little urgency for an interim trade agreement. On Sept. 20, he told reporters he was under no pressure to reach a deal with China before the 2020 election, despite his early insistence that China was eager to return to the negotiation table. Last month, Trump said the United States had reached a trade deal with Japan, although terms of the deal were scarce.
The year-long dispute between the United States and China has compelled American businesses to scale back investing amid the uncertainty wrought by Trump’s at-times-contradictory trade policies. He routinely points to a strong domestic economy as his best argument for reelection, but there have been signs of an economic slowdown. Wall Street is frequently jolted by Trump’s sudden pronouncements. Manufacturing is in a slump, and hiring cooled in August.
“The darkening outlook for trade is discouraging but not unexpected,” WTO Director-General Roberto Azevêdo said in a statement. “Beyond their direct effects, trade conflicts heighten uncertainty. … Job creation may also be hampered as firms employ fewer workers to produce goods and services for export.”
The WTO emphasized that the “high degree of uncertainty” surrounding global trade affects the organization’s projections. Figures could worsen if trade tensions escalate, or the numbers could improve if the sparring abates.
The WTO further warned...
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