The general director of the World Trade Organization (WTO), Ngozi Okonjo-Iweala, said Wednesday that the increase in commercial tensions between the United States and China exposes bilateral trade to a very strong risk of contraction, of up to 80%, and a 7% fall of the world real GDP.
“Our preliminary projections suggest that the merchandise trade between these two economies could decrease up to 80%,” he warned.
The president of the United States, Donald Trump, announced today his decision to raise “with immediate effect” to 125% the tariffs imposed on China, compared to 104% in which they were.
He also announced a 90 -day break in the application of tariffs to those countries that have not taken commercial reprisals against their tariff plan.
Okonjo-Iweala recalled that the United States and China represent 3% of world trade together and that the confrontation in which they have engaged “entails broader implications that could seriously damage global economic perspectives.”
He explained that negative macroeconomic effects will not be limited to the United States and China, but will extend to other economies, especially to less developed nations.
For the WTO there is the danger of a fragmentation of world trade “along geopolitical lines”, that is, a division of the global economy into at least two blocks.
The consequence could be the long -term reduction of the world real GDP of almost 7%, he said.
“The deviation of trade represents an immediate and urgent threat, which requires a coordinated global response. We urge all WTO members to face this challenge through cooperation and dialogue,” he invoked.
With EFE information
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