WTO Chief Warns Against Trade Wars Amid Tariff Threats

The WTO Director-General, Ngozi Okonjo-Iweala, urged nations to avoid retaliatory trade wars, warning of devastating impacts on global growth. Speaking at Davos, Okonjo-Iweala referenced the 1930s protectionist measures and called for calm and use of WTO dispute resolutions instead of tariffs, while Brazil's envoy echoed similar concerns.

The World Trade Organization (WTO) Director-General, Ngozi Okonjo-Iweala, cautioned nations against engaging in tit-for-tat trade wars, emphasizing the dire global economic repercussions. She spoke at the World Economic Forum in Davos, warning that retaliatory tariffs could lead to double-digit GDP losses.

Okonjo-Iweala drew parallels with the 1930s Smoot-Hawley Act, highlighting the detrimental effects of protectionist measures during that era. She urged WTO members to seek resolutions through the organization's dispute systems rather than escalating tariffs.

While these systems remain partly functional due to recent challenges, Okonjo-Iweala expressed optimism over Trump's decision to delay tariff impositions. Brazil's envoy, Alexandre Parola, also called for restraint, criticizing the political use of tariffs as damaging to international rules-based trade.

(With inputs from agencies.)