WTO set to cut trade growth estimates

The news: The World Trade Organization has told Reuters it expects goods trade growth for 2023 and 2024 to fall below estimates due to a less buoyant global economy and the impact of disruptions to shipping through the Suez Canal.

The numbers: In October, the WTO estimated merchandise trade growth would be 0.8% for 2023 and 3.3% for 2024. Chief WTO Economist Ralph Ossa said merchandise trade dropped 1.4% year-on-year in the first three quarters of 2023, so full-year growth is likely to be below the estimate. Growth in 2024 will be stronger than 2023, but still lower than forecast.

The context: Ossa said both annual growth estimates now appear "overly optimistic". "At the moment [2023 growth] looks like it's going to be less than 0.8%. Whether it's positive or negative, I don't know," he said. Europe had done worse than expected and the post-COVID recovery of China was not as strong as imagined. For 2024, Ossa said a number of international organisations had downgraded their GDP growth forecasts, with a likely knock-on effect on the WTO's own trade predictions. He said after the initial shock to supply chains from Suez Canal disruptions, the most likely impact would be higher prices for consumers due to increased shipping costs. The WTO will publish updated figures in about two months.