GENEVA: Global commerce is set to expand by 3.1 percent this year, the World Trade Organization (WTO) said on Tuesday, cutting its previous forecast of 4.6 percent because of weak growth and demand.
The Geneva-based body also downgraded its forecast for trade growth in 2015 to 4.0 percent from 5.3 percent.
“International institutions have significantly revised their GDP forecasts after disappointing economic growth in the first half of the year,” said WTO chief Roberto Azevedo in a statement.
“In light of this, the WTO’s forecasts for trade growth have also been revised downwards for 2014 and 2015. Uneven growth and continuing geopolitical tensions will remain a risk for both trade and output in
the second half of the year,” he added.
Among the problems, the WTO said, are tensions over the Ukraine crisis pitting the European Union and the United States against Russia.
The resultant tit-for-tat trade measures have notably affected agricultural commodities.
Conflict in the Middle East is also stoking uncertainty, and could lead to a spike in oil prices if the security of supplies is threatened, said the WTO.
And the Ebola outbreak raging in west Africa has also sown panic over its economic impact in the region and potentially beyond, it added.
The WTO noted that growth and import demand was particularly muted in natural resource exporting regions such as South and Central America.