Global trade at its slowest in seven years
Global trade this year will now grow at its slowest pace since 2009, according to the World Trade Organisation, with slowing trade growth in developing economies and the United States being blamed.
The body has dramatically downgraded its trade growth forecast for this year to just 1.7pc, well below its April forecast of 2.8pc.
The Geneva-based organisation warned the slowdown was “serious” and should serve as a “wake-up call”.
Next year’s estimates have also been revised down. The WTO expects growth of between 1.8pc and 3.1pc, down from 3.6pc previously.
“With expected global GDP growth of 2.2pc in 2016, this year would mark the slowest pace of trade and output growth since the financial crisis of 2009,” the World Trade Organisation has said.
The WTO said the downgrade follows a sharper than expected decline in merchandise trade volumes in the first three months of this year, and a smaller than anticipated rebound in the second quarter.
The organisation said the contraction was driven by slowing GDP and trade growth in developing economies such as China and Brazil but also in North America.
"The dramatic slowing of trade growth is serious and should serve as a wake-up call,” said WTO Director-General Roberto Azevêdo.
“It is particularly concerning in the context of growing anti-globalisation sentiment.
“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.”