The World Trade Organization (WTO) has issued a fresh warning that global trade is facing a serious setback in 2025, with North America expected to take the biggest hit. In a report released on Wednesday, the WTO revealed that exports from North America could fall by 12.6%, while imports may decline by 9.6%, even without the most severe tariffs being enforced.
The trade body’s forecast was based on the tariff landscape as of this Monday. According to the WTO, the global economy was initially projected to enjoy steady trade expansion in 2025 and 2026, but former U.S. President Donald Trump’s escalating trade war has now forced them to revise that outlook sharply downwards.
Under Trump’s current plan, trade in goods around the world could slump by 1.5% if the most severe set of tariffs are imposed on dozens of countries. These tariffs, described as the “toughest yet”, are currently on hold for 90 days. During this period, over 70 countries have been invited to negotiate with the United States to address trade concerns.
Still, despite this temporary pause, the WTO says the level of uncertainty surrounding trade policy is enough to hurt global commerce and damage already fragile economies. WTO Director-General Ngozi Okonjo-Iweala, a Nigerian economist, expressed strong concerns in the report. She said the continued uncertainty could drag down global growth and hurt vulnerable economies the most.
“Our simulations show that trade policy uncertainty has a significant dampening effect on trade flows,” said Ralph Ossa, the WTO’s Chief Economist. “It reduces exports and weakens economic activity.” He also warned that tariffs come with serious unintended consequences, especially at a time when the global economy is still recovering from past shocks.
Trump has already raised tariffs on Chinese imports to 145%, and his administration is locked in ongoing negotiations with Canada and Mexico about new tariffs on goods from those countries. This back-and-forth is adding more pressure on businesses that rely on stable trade conditions to make investment decisions and plan their operations.
Trade experts believe the uncertainty and possible rise in protectionism could have wider ripple effects, especially in developing nations that depend on trade with wealthier economies. Industries like manufacturing, technology, and agriculture could be among the hardest hit.
For Nigeria and other African economies, a slowdown in global trade could mean lower demand for exports like oil, minerals, and agricultural products. It could also reduce foreign investment inflows and limit access to global markets for African businesses.
