WTO: world trade will remain under pressure from external factors in 2023

The growth of world trade will slow to 1.7% in 2023, after an increase of 2.7% in 2022, according to the annual projections of the World Trade Organization (WTO) published this Wednesday.

WTO economists now forecast trade volume growth of 1.7% in 2023 – up from the 1.0% estimate made in October – although down from 2.7% in 2022.

According to the WTO, a key factor in this improvement is the easing of controls linked to the COVID-19 pandemic in China, which would release pent-up consumer demand in the country and thus stimulate international trade.

On the other hand, the WTO economists project GDP growth of 2.4%.

“Trade continues to be a driver of the resilience of the world economy, but it will continue to be under pressure from external factors in 2023″, stressed the director general of the WTO, Ngozi Okonjo-Iweala, in a statement, in which she urged governments to avoid “a fragmentation of commercial transactions” already refrain “to put obstacles to trade”.

The fact that the volume of world trade grew by 2.7% in 2022, less than the rate of 3.5% that the WTO had predicted in October, was due to a drop in the fourth quarter of last year, caused by several factors, according to the WTO.

These include rising global commodity prices, tightening of monetary policy in response to inflation, and outbreaks of COVID-19, which have disrupted production and trade in China.

For the chief economist of the WTO, Ralph Ossa, it is “likely” that factors such as “lingering effects of COVID-19 and growing geopolitical tensions” also affect trade and production in 2023, as they already did in 2022.

By 2024, trade is expected to grow 3.2% and GDP 2.6%.

But this is an estimate.”stained with a stronger than usual uncertainty”, warns the WTO, due to geopolitical tensions, global food insecurity and the possible unforeseen consequences of the tightening of monetary policies, the risks that affect financial stability and the increase in debt.