The war is causing a chain reaction for the world economy

The WTO has clarified its forecast for world trade growth this year. On Tuesday in Geneva, she said she expected a 3% increase compared to 4.7% expected before the war in Ukraine. She is concerned about appointments at the June ministerial meeting in Geneva.

The World Trade Organization (WTO) leaked a range between 2.4 and 3% on Monday night. On Tuesday, she unveiled a estimate that takes the top of it. But “these figures may be revised due to the uncertainty” associated with the war in Ukraine.

Growth in trade in goods can vary from 0.5 to more than 5%, as the situation is unstable. The impact of this conflict could be felt “all over the world”, especially for access to food in poor countries, said the director general of the organization Ngozi Okonjo-Iweala. Supply is threatened and inflation is rising.

Expected decline in Russia

A total of 35 African countries import food from Russia and Ukraine. Recently, Ngozi called on Okonjo-Iweala states that rely on surplus-safe food stocks to bring them to market if they can.

The region, which brings together Russia and Ukraine in particular, is set to face a 12% drop in its imports and 7.9% of its GDP. But exports are expected to increase by almost 5% due to dependence on Russian energy.

Another problem is that trade in services will also be affected by the conflict in Ukraine. Russia is a net importer on this issue. Another indication, last year, was the volume of goods increased by 9.8% and 26% in value, the WTO adds.

Expected at 3.4% for next year

In addition to the war, the detentions in China due to the pandemic are once again disrupting maritime trade, according to the institution. More generally, “the last few years have been tumultuous” for the economy and world trade, the director general told the press.

For 2023, world trade growth is now expected to be 3.4%. For its part, gross domestic product (GDP) is expected to grow by 2.8% this year, down 1.3 points from previous estimates, after rising by almost 6% last year.

These figures also raise concerns with the Director – General about their possible impact on the very important ministerial meeting in June in Geneva. Dr. In particular, Ngozi wants agreements in three areas, namely the response to the pandemic, agriculture and subsidies for overfishing. “I can not promise success” on all of these components, she said.

“There is no doubt that the war has increased tensions” and “the environment is very insecure”, according to her. In the event of further sanctions, in particular an energy embargo against Russia, “the threat is real” for the ministerial meeting, and “we will have to see how it affects our work”, confirmed Dr. Ngozi.

Negotiations are currently taking place in small groups. Many Western countries and other actors have said they will no longer comply with WTO rules with regard to Russia. Moscow is widely boycotted by dozens of actors.

calls on the states to cooperate

And Dr. Ngozi calls for cooperation despite the tensions. The organization “can play a central role” in peaceful discussion of differences, she said. The effort must continue, she said. In particular, on the response of world trade to the pandemic that Switzerland is opposed to a temporary repeal of patents on coronavirus technologies.

In terms of fisheries, states are seeking a scheme after more than 20 years of negotiating subsidies, estimated at up to $ 54 billion a year. The aim is to ban them from a vessel engaged in illegal, unreported or unregulated fishing. But also those for overfishing in areas that are already overexploited.

According to the UN, 90% of marine stocks are exploited or overexploited. One third of the catch is linked to overfishing. Wealthy states want China not to be able to rely on exceptions because of its self-proclaimed status as a developing country.

In a draft agreement, exemptions have been granted to poor countries and developing countries with low fisheries. As well as measures to limit the use of forced labor, enough to try to satisfy everyone. But developing countries find it beneficial for rich countries.

This article has been published automatically. Source: ats

Leave a Comment