WTO warns rival trade blocs could shave 7% off global GDP
WTO Director-General Ngozi Okonjo-Iweala warned that retaliatory tariffs could split the global economy into hostile trading blocs, with a possible 7% hit to global GDP and a 20% collapse in global trade. She said WTO modeling also estimates that systemic reform could unlock $3 trillion in new output by 2050. She noted global commerce has shown resilience, partly due to AI investment, but said the rules could be further eroded without reform.
Why it matters: This matters for the trade blocs theme because it quantifies the macroeconomic cost of a world divided into rival economic camps.