DG-WTO, Dr Ngozi Okonjo-Iweala.

The Director General of World Trade Organisation WTO, Nigeria’s Ngozi Okonjo-Iweala has warned that the ongoing tit-for-tat trade tariff war initiated by the President of the United States of America, Donald Trump could hurt the global economy.

The global trade regulatory body warned that if not urgently curtailed, the global merchandise trade volumes for 2025 could contract by as much as one per cent as a result of the raging trade tariff war.

Recall that China had threatened to introduce some retaliatory trade tariffs on goods made in the US entering China in reaction to some new tariffs announced by Trump on products coming into US from China, Canada, some European countries, Latin America and Africa, especially South Africa.

In a statement, the WTO DG warned that such trade tariff war could portend great danger for the global economy, especially at this time. “We need to avoid a tit-for-tat trade tariff war. This will be destructive for the global economy”, she warned.

The statement reads in part: “The WTO Secretariat is closely monitoring and analysing the measures announced by the United States on April 2, 2025. Many members have reached out to us and we are actively engaging with them in response to their questions about the potential impact on their economies and the global trading system.

“The recent announcements will have substantial implications for global trade and economic growth prospects. While the situation is rapidly evolving, our initial estimates suggest that these measures, coupled with those introduced since the beginning of the year, could lead to an overall contraction of around one per cent in global merchandise trade volumes this year, representing a downward revision of nearly four percentage points from previous projections.

“I’m deeply concerned about this decline and the potential for escalation into a tariff war with a cycle of retaliatory measures that lead to further declines in trade.

“It is important to remember that, despite these new measures, the vast majority of global trade still flows under the WTO’s Most-Favored-Nation MFN terms. Our estimates now indicate that this share currently stands at 74per cent, down from around 80per cent at the beginning of the year. WTO members must stand together to safeguard these gains.

Trade measures of this magnitude have the potential to create significant trade diversion effects. I call on Members to manage the resulting pressures responsibly to prevent trade tensions from proliferating.

The WTO was established to serve precisely in moments like this — as a platform for dialogue, to prevent trade conflicts from escalating, and to support an open and predictable trading environment. I encourage Members to utilise this forum to engage constructively and seek cooperative solutions.”