World trade seen growing
2.4 percent in 2017, uncertainty weighs: WTO
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[April 12, 2017]
By Stephanie Nebehay
GENEVA
(Reuters) - World trade is on track to expand by 2.4 percent this year,
though there is "deep uncertainty" about economic and policy
developments, particularly in the United States, the World Trade
Organization (WTO) said on Wednesday.
WTO director-general Roberto Azevedo said that clarity was still needed
on U.S. President Donald Trump's trade policies, while making a general
appeal to resist protectionism.
The results of upcoming elections in major economies including France
should provide more predictability for investors, he said.
The range for growth this year has been adjusted to between 1.8 and 3.6
percent, from 1.8 to 3.1 percent last September, the WTO said.
"We should see trade as part of the solution to economic difficulties,
not part of the problem," Azevedo said.
"Overall I think that while there are some reasons for cautious
optimism, trade growth remains fragile and there are considerable risks
on the downside. Much of the uncertainty around the outlook is
political," he told a news conference.
"We need to keep strengthening the system, delivering new reforms, and
resisting the erection of new barriers to trade."
The WTO has repeatedly revised preliminary estimates over the past five
years as predictions of economic recovery prove overly optimistic.
Global trade grew by "an usually low" 1.3 percent in 2016, the slowest
pace since the financial crisis, failing to match even its revised
forecast of 1.7 percent of last September.
"The poor performance over the year was largely due to a significant
slowdown in emerging markets where imports basically stagnated last
year, barely growing in volume terms," Azevedo said.
In 2018, global trade is forecast to grow by between 2.1 percent and 4
percent in WTO's latest analysis.
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World Trade Organization (WTO) Director-General Roberto Azevedo
attends a news conference on world trade figure for 2016 and
forecast for 2017 in Geneva, Switzerland, April 12, 2017.
REUTERS/Denis Balibouse
"A spike in inflation leading to higher interest rates, tighter fiscal
policies and the imposition of measures to curtail trade could all
undermine higher trade growth over the next two years," it warned.
Trump has made reducing U.S. trade deficits a key focus of his economic
agenda to try to grow American manufacturing jobs. He has taken
particular aim at renegotiating trade relationships with China and
Mexico.
He is considering an executive order to launch a trade investigation
that could lead to supplemental duties in certain product categories, a
Trump administration official told Reuters on Monday.
"If policymakers attempt to address job losses at home with severe
restrictions on imports, trade cannot help boost growth and may even
constitute a drag on the recovery," Azevedo said.
He awaited confirmation of the new U.S. Trade Representative (USTR)
nominee Richard Lighthizer - who has pledged an "America First" strategy
to aggressively enforce U.S. laws and trade deals to stop unfair imports
and push China to scrap excess factory capacity.
"We are waiting to see the new trade team really in place, waiting for
the new USTR to be confirmed so that we can have a more meaningful
dialogue at this point in time we don't have that. We are still waiting
to see how the trade policy itself is going to shape up in the United
States."
(Reporting by Stephanie Nebehay; Editing by Andrew Heavens)
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