The World Trade Organization said Tuesday that growth in global merchandise trade volume is expected to slow to 2.6 percent this year, down from 3 percent last year, amid a tariff war between the United States and China.
"With trade tensions running high, no one should be surprised by this outlook," WTO Director General Robert Azevedo said in a news release. "Trade cannot play its full role in driving growth when we see such high levels of uncertainty."
The WTO warned that trade growth this year could even be below or above this range, depending largely on the outcome of negotiations between Washington and Beijing.
"If we forget the fundamental importance of the rules-based trading system we would risk weakening it, which would be an historic mistake with repercussions for jobs, growth and stability around the world," Azevedo said.
The administration of U.S. President Donald Trump has imposed tariffs on a total of $250 billion in Chinese imports — or about half of the goods the United States imports from China each year — in response to what Washington calls Beijing's "unfair" trade practices such as alleged intellectual property theft and forced technology transfers.
China has retaliated with tariffs on $110 billion of U.S. imports.
At their summit in Argentina last December, Trump and Chinese President Xi Jinping agreed to a truce in which both promised to refrain from imposing further tariffs for 90 days while trying to complete trade negotiations.
As working-level and ministerial-level talks continue, Washington extended the March 1 deadline, with speculation rife that Trump and Xi may hold a summit in the near future to end the trade war.