Okonjo-Iweala Warns Against Trade Fragmentation Risks

During a fireside chat in Lagos, Nigeria, on the occasion of Streamsowers and Köhn’s 20th anniversary, Dr. Ngozi Okonjo-Iweala, the Director General of the World Trade Organisation (WTO), addressed significant concerns regarding the impact of geopolitics and global conflicts on trade.

She highlighted that the world is experiencing unprecedented disruptions to global trade rules and multilateral systems, which are at their weakest in decades. Okonjo-Iweala noted that trade instruments are increasingly being used to address non-trade issues, complicating the WTO's ability to manage these challenges.

She warned that a tit-for-tat approach to trade disputes, particularly between major economies like the U.S. and China, could lead to a fragmentation of global trade, potentially resulting in a 7% loss in global GDP. Okonjo-Iweala urged countries to avoid such retaliatory measures, emphasizing the importance of multilateral cooperation to prevent economic deterioration.