WTO cuts 2016 world trade growth forecast to 1.7 percent, cites wake-up call
By Tom Miles
GENEVA (Reuters) - The World Trade Organization cut its forecast for global trade growth this year by more than a third on Tuesday, reflecting a slowdown in China and falling levels of imports into the United States.
The new figure of 1.7 percent, down from the WTO's previous estimate of 2.8 percent in April, marked the first time in 15 years that international commerce was expected to lag the growth of the world economy, the trade body said.
The figures should be a wake-up call for governments, WTO Director-General Roberto Azevedo said in the six-monthly trade outlook report.
"We need to make sure that this does not translate into misguided policies that could make the situation much worse, not only from the perspective of trade but also for job creation and economic growth and development which are so closely linked to an open trading system," the report quoted him as saying.
The data underlined concerns that, after a long period of growth through globalization and reliance on global trade, governments are increasingly seeking to protect their own industries and promote domestic producers at the expense of foreign competitors.
Although all governments deny protectionism, trade is no longer outpacing economic growth as it used to. Trade has grown 1.5 times faster than gross domestic product over the long term, and twice as fast when globalization picked up in the 1990s.
This year trade will grow only 80 percent as fast as the global economy, the WTO said, the first reversal of globalization since 2001 and only the second since 1982.
“I am absolutely convinced that this is not a moment to turn inward,” Azevedo told a WTO conference. Continued...