WTO Cuts Down Global Trade Volume Growth For 2022 To 3% Over Ukraine Conflict

WTO cuts global trade volume growth for 2022 due to Russia-Ukraine war

New Delhi:

The World Trade Organization (WTO) said on Tuesday that world trade volume is expected to grow by 3 per cent in 2022, against an earlier forecast of 4.7 per cent, mainly due to the ongoing war between Russia and Ukraine.

The prospects for the global economy have turned bleak since the outbreak of the war in Ukraine on February 24, prompting WTO economists to re-evaluate their projections for world trade over the next two years, the global trade body said in a statement. has been inspired.

“The organization now expects trading volume to increase by 3 percent in 2022 — down from its previous forecast of 4.7 percent — and 3.4 percent in 2023, but these estimates are less certain than usual due to the fluid nature of the conflict,” it said. couple.

The most immediate economic impact of the crisis has been a sharp rise in commodity prices. Despite their small share in world trade and production, Russia and Ukraine are major suppliers of essential goods, including food, energy and fertiliser, whose supplies are now under threat from war, the statement said. The WTO noted that grain shipments through Black Sea ports have already been halted, which could have serious consequences for food security in poor countries.

Besides the war, the lockdown in China to contain the spread of COVID-19 is again disrupting maritime trade at a time when supply chain pressures appear to be easing, it said, leading to shortages in manufacturing inputs and high inflation. can.

“The war in Ukraine … has also damaged the global economy at a critical juncture. Its effects will be felt around the world, especially in low-income countries, where food accounts for a large proportion of household spending, Director General Ngoji Okonjo-Iwela said. “In a crisis, more trade is needed to ensure stable, equitable access to necessities. Restricting trade would threaten the well-being of families and businesses…,” she said.

He said governments and multilateral organizations should work together to facilitate trade in times of sharp inflationary pressures on essential supplies and increasing pressure on supply chains.

These growth projections will be updated in October, but earlier revisions may be issued if incoming data is confirmed, the statement said.

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