WTO Boss Warns US and China on Trade Fight

The US and China are throwing punches on each other right now, and the referee—none other than the World Trade Organization's top official—is begging them to lower their fists before everyone gets knocked out.

In Washington, WTO Director-General Ngozi Okonjo-Iweala sat down for a candid chat with reporters. She's not mincing words. With fresh tariffs being rapidly imposed by both parties, she presented a troubling view. If these two powerhouse economies keep drifting apart—think supply chains snapping and markets fracturing—the fallout could slash global output by a whopping 7% down the road.

That’s no small sum; it amounts to trillions in lost wealth, affecting jobs and prices across everything from American farms to Chinese factories. Dig a bit deeper, and the numbers tell a story of their own. Just last week, the WTO crunched the data and dialed back its 2026 trade growth forecast to a measly 0.5%, blaming the ripple effects of US President Donald Trump's latest tariff hikes.

For 2025, they're holding steady at 2.4% growth, but that provides little comfort. Okonjo-Iweala has been on the phone with officials in both capitals, pushing for talks over tantrums. She even laid it out plain to the G20 crowd on Wednesday: no steady trade means no steady money anywhere.

She observes that most countries have stayed out of this trouble so far, with 72% of world trade still playing by WTO rules. Yet cracks are appearing—trade rerouting is sparking protectionism in areas like Europe and Asia.

Why does this hit home for the average person? Higher costs for everything from phones to groceries, slower growth in your neighborhood economy.

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