WTO reduces its forecast for world trade to 3 % in 2022
Tags: Economy/Finance
The World Trade Organization (WTO) in a press release released on 5 October 2022 has reduced its global trade growth forecast for 2022 to 3% from its earlier forecast of 3.5%. It said that high commodity prices and rising interest rates would curb import demand, and warned of a likely contraction in world trade if the conflict in Ukraine escalates.
The growth in world trade is expected to slow down to one per cent in 2023, due to global uncertainties.
Elaborating the area of concern for world trade WTO director-general Ngozi Okonjo-Iweala said in Geneva that “If the war in Ukraine worsens, rather than gets better, that’s going to have a huge impact,”.
Trade and economic output will be weighed down by several shocks, including the war in Ukraine, high energy prices, inflation, and monetary tightening,
WTO said that demand in Europe will decline and the cost of manufacturing will increase due to high energy prices stemming from the Russia-Ukraine war.
According to the WTO ,in the United States of America monetary policy tightening will hit interest-sensitive spending in areas such as housing, motor vehicles and fixed investment,” .
WTO expects the World GDP to grow by 2.8% in 2022 and by 2.3% in 2023 (revised down from 3.2%).
World Trade Organisation (WTO)
- It was set up on 1st January 1995 replacing the General Agreement on Tariff and Trade (GATT).
- Its main purpose is to promote rule based trading systems in the world and it also settles trade related disputes between the member countries.
- The headquarters of WTO is in Geneva, Switzerland.
- There are 164 member countries.
- Director General of WTO : Dr Ngozi -Okonjo-Iweala of Nigeria
- Report released by WTO : World Trade Report
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