- The International Monetary Fund and the World Trade Organisation said the United States’ tariffs pose a risk to the global economy
- The IMF urged the US to work with its trade partners to resolve trade tensions and reduce uncertainty
- The WTO warned of retaliatory tariffs and further trade reductions
The International Monetary Fund (IMF) and the World Trade Organisation (WTO) have warned of the risk to the global economy of the recent tariffs imposed on countries by the United States of America (USA).
The warning was contained in separate statements released by the global bodies on Thursday, April 3, in response to the Tuesday announcement of sweeping tariffs on countries by US President Donald Trump.
Tariffs pose risk to global outlook – IMF
In a statement, the Director-General of the IMF, Kristalina Georgieva, said new US tariffs pose a significant risk to the global outlook, particularly at a time of sluggish growth.
Georgieva urged the US to work with its trade partners toward resolving trade tensions and reducing uncertainty.
The tariffs “clearly represent a significant risk to the global outlook at a time of sluggish growth.
“It is important to avoid steps that could further harm the world economy.
“We appeal to the United States and its trading partners to work constructively to resolve trade tensions and reduce uncertainty,” Georgieva said.
The IMF, in January, said global growth was expected to hit 3.3 per cent this year, below the 3.7 per cent average global growth rate in the first two decades of the 21st century.
As the IMF prepares to publish its new outlook later this month in time for the Spring Meetings in Washington, the US trade tariff onslaught will be top on the agenda.
US tariffs could affect global trade, economic growth – WTO
For her part, the Director-General of the WTO, Ngozi Okonjo-Iweala, warned that the US tariffs could significantly affect global trade and economic growth.
In a statement, Okonjo-Iweala said the WTO is closely monitoring the situation and engaging with member countries about the potential economic impacts.
She noted that many WTO members have expressed concern, and the organisation is working to address these concerns.
Okonjo-Iweala cautioned that these new tariffs, in combination with other trade measures introduced earlier this year, could result in a global trade contraction of about one per cent, marking a downward revision of nearly four percentage points from previous estimates.
“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,” Okonjo-Iweala said.
Okonjo-Iweala warns of retaliatory tariffs, further trade reductions
The WTO DG also highlighted the risk of escalating trade tensions, which could lead to retaliatory tariffs and further reductions in trade.
Okonjo-Iweala reminded that despite recent measures, the majority of global trade still operates under the WTO’s Most-Favored-Nation terms, although this share has declined from 80 per cent at the start of the year to 74 per cent.
She urged WTO members to collaborate and manage the situation responsibly to avoid worsening trade conflicts.
“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 terms.
“Our estimates now indicate that this share currently stands at 74 per cent, down from around 80 per cent at the beginning of the year.
“WTO members must stand together to safeguard these gains.
“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,” Okonjo-Iweala added.
Trump imposed a 14% tariff on exports from Nigeria, others
Recall that on April 2, President Trump announced sweeping tariffs, including a baseline 10 per cent tariff on US imports and reciprocal tariffs against countries that impose higher duties on US goods.
The new tariffs, which take effect immediately, apply to over 50 countries, including China, the European Union, India, Japan, and developing economies in Africa, Asia, and Latin America.
The tariff imposition extends to Nigeria, Ghana, Ethiopia, Mauritius, Algeria, and other African countries.
While Nigeria currently imposes a 27 per cent tariff on US goods, the US announced that it will apply a 14 per cent reciprocal tariff on Nigerian exports under the new law.
Trump said the move aims to supercharge America’s economy and force open foreign markets that are accused of shutting out US goods.
“This is one of the most important days in American history.
“We will supercharge our domestic industrial base. We will pry open foreign markets and break down foreign trade barriers,” Trump said.
Trump’s tariffs imposition can trigger global trade war, job losses, higher consumer prices – ITUC
Meanwhile, TheRadar earlier reported that the International Trade Union Confederation (ITUC) said the new trade tariffs imposed on countries by the President of the United States of America, Donald Trump, could spark a global trade war, lead to job losses, and increase consumer prices.
In a statement released on Thursday, April 3, signed by its General Secretary, Luc Triangle, ITUC described the move as a reckless economic manoeuvre that will disproportionately affect workers while benefiting corporate elites.
