World Trade Organization (WTO) Director-General NgoziOkonjo-Iweala has called for restraint among nations regarding tariffs, warning that escalating trade tensions could be “catastrophic” for the global economy. Her appeal came during a panel discussion at the World Economic Forum in Davos, Switzerland, on Thursday.
Okonjo-Iweala’s comments followed recent threats from U.S. President Donald Trump to impose tariffs on China, the European Union, Mexico, and Canada. Urging leaders to remain calm, she remarked, “Please let’s not hyperventilate. I know we are here to discuss tariffs, but could we chill?” She expressed concern about the rising rhetoric around trade conflicts and the potential consequences.
Drawing a parallel with the Smoot-Hawley Tariff Act of 1930, which worsened the global economic crisis during the Great Depression by triggering retaliatory measures, Okonjo-Iweala warned that a tit-for-tat tariff war could lead to severe economic damage. “If we go back to where we were in the 1930s, we are going to see double-digit global GDP losses,” she said, describing the potential fallout as “catastrophic.”
The WTO chief also urged member countries to explore other channels for resolving trade disputes rather than resorting to tariffs. She emphasized that even if tariffs are implemented, nations should approach the situation with caution and avoid rushing into retaliatory actions without proper groundwork.
Okonjo-Iweala’s message underscores the importance of cooperation and measured responses to trade issues to avoid repeating the mistakes of the past and risking significant damage to the global economy.
