Adjustments to Growth Forecasts by the WTO

On April 10 the World Trade Organisation (WTO) cut growth projections for 2013 from 4.5 per cent to 3.3 per cent on the back of slow economic growth exhibited by advanced economies, high unemployment figures and the continuing Eurozone crisis. “This year looks to be a near repeat of 2012 with both world trade and output forecast to expand slowly and below historical trends and averages” said Pascal Lamy, Director-General of the WTO, at the recent Trade Negotiation Committee meeting.

Lamy, stressed that while the Governments of developed countries are struggling to find a balance between short-term growth and restrictive fiscal constraints, resorting to protectionist measures is neither a wise nor sustainable course of action. History has very clearly taught us that over the past century.

The WTO’s Ninth Ministerial Conference, which is to be held in Bali in December 2013, is being labelled one of the best opportunities to achieve progress on multilateral trade issues since the troubled Doha negotiations. “Against this uncertain backdrop, the stakes for Bali are high,” Lamy said, “And this is why for the first time since 2008, there is political consensus that the Ministerial meeting in Bali should be about deliverables in trade facilitation, agriculture and S&D/LDC issues.”

Thankfully, longer-term forecasts indicate that stronger growth is expected in 2014, at approximately 5.2 per cent, which is closer to the long-term average.