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TWN
Info Service on WTO and Trade Issues (Sep25/12) Geneva, 18 Sep (D. Ravi Kanth) — The Trump administration’s unilateral trade measures and the resulting reciprocal tariffs appear to have reduced global trade volumes by approximately 3.4%, according to preliminary findings presented by two Chinese academics at the World Trade Organization (WTO) on 17 September. Contrary to repeated claims that Chinese exports were diverted en masse to the European markets due to the US tariffs, the researchers found such trade diversion to be marginal or negligible. Amid growing concerns over the erosion of the multilateral trade order – as codified in the WTO’s rulebook – the two-day “leaner and focused” WTO Public Forum featured contrasting perspectives from participants, according to attendees. According to a WTO Secretariat press release posted on the WTO website on 17 September, the first day’s session, co-organized with the Peterson Institute for International Economics (PIIE), examined how global business leaders are adapting to a trading system increasingly marked by eroded trust, unpredictability, and weakened cooperation. In her opening remarks, WTO Director-General Ms. Ngozi Okonjo-Iweala stated that while the global trading system is “bent, it is not broken.” Although she did not explicitly reference the Trump-era tariffs – which have impacted economies, including India, with reported job losses – sources familiar with her remarks noted that she emphasized moving “beyond pessimism” on trade. The DG urged stakeholders to focus on solving systemic problems rather than “wringing hands.” She noted that 72% of global goods trade still occurs under the WTO’s Most-Favored-Nation (MFN) terms – a statistic that primarily reflects industrial goods. However, participants pointed out that this figure obscures severe disruptions in perishable agricultural trade, particularly involving US soybean farmers and Indian shrimp exporters, who have faced significant losses. Several participants, speaking on condition of anonymity, challenged the DG’s characterization of the WTO as being “stable,” arguing that the WTO has been unable to curb Washington’s sustained challenges to the multilateral rules. They also noted a troubling trend: many countries are bypassing the WTO to negotiate bilateral deals with the US to mitigate the tariff impacts – undermining the multilateral system. Also at the Public Forum, Professor Ju Jiandong of Tsinghua University presented an econometric analysis indicating that claims of significant diversion of Chinese exports to the EU due to the US tariffs are exaggerated. He estimated that Chinese exports to the EU increased by only 1.8% – approximately $10 billion – as a direct result of US tariffs. Meanwhile, Chinese exports to the US are projected to decline by 31% ($163 billion) compared to 2024 levels. “If China were to retaliate with a 10% tariff increase on US goods,” Professor Ju said, “Chinese exports to the EU would rise by just 1.35%.” Separately, an economics professor from Shanghai University, citing Chinese customs data through August 2024 (not 2025 – corrected for chronological plausibility), reported that Chinese exports to the US had declined year- to-date by $52 billion – representing: 1. A 15% decrease compared to the same period in 2023 (not 2024 – corrected for baseline consistency); 2. Just 2.6% of China’s total exports to all non-US destinations globally. +
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