GENEVA, Switzerland (AFP) — Major consequences of the tit-for-tat tariffs being levied by top economies are not evident yet “but they will come” and will wreak havoc across the global economy, the World Trade Organization chief warned Wednesday.
Roberto Azevedo said he feared “this dynamic of an eye-for-an-eye” that has seen major powers slap trade barriers on each other’s goods could become “the new normal.”
“The situation requires an urgent response,” Azevedo told reporters in Geneva.
The call came as the 164-member WTO launched a report documenting that trade restrictive measures are on the rise, an unsurprising trend amid the escalating trade war.
“A lot of the negative effects of the kind of measures that are being put in place today are not visible yet but they will come,” Azevedo said.
“So, if we continue down this road I am sure that we are going to see a slowdown in the economy,” he added, voicing fear that the repercussions will be vast.
“I fear for everything, for jobs… I fear for salaries that will be compressed,” he said.
In the report covering mid-October 2017 to mid-May 2018 the WTO documented 75 new trade restrictions imposed by its members, an average of 11 per month.
That marks an increase compared to the previous reporting period of October 2016 to October 2017, which saw nine new restrictions per month.
Azevedo declined to pin blame for the pattern on the US President Donald Trump, whose “America first” trade policies have included tariffs on tens of billions of goods from major trading partners like China, the European Union and Canada.
Most nations targeted by Trump’s tariffs have retaliated.
The US Agriculture Department announced it will provide up to US$12 billion in aid to farmers hurt by trade tariffs, as Trump faces increasing criticism from consumers, farmers and businesses taking a hit from the global retaliation against US goods.
European Commission President Jean-Claude Juncker was heading to Washington on Wednesday to meet Trump in an attempt to avert further escalation.
“I am sure that if the situation continues to aggravate the way it is it will be pretty evident for everyone that some kind of solution needs to be found,” Azevedo said.
“We are calling everyone who believes that trade is a force for good to speak up,” he added.