The head of the World Trade Organization, Ngozi Okonjo-Iweala, expressed hope for a swift resolution to the conflict between Israel and Hamas, warning that its escalation would have a "really significant" impact on already weak global trade flows. Speaking in Morocco during the annual meetings of the International Monetary Fund and World Bank, she stated that violence in the Middle East could exacerbate factors constraining trade growth, including rising interest rates, a troubled Chinese real estate market, and the ongoing war in Ukraine.
In an interview, Okonjo-Iweala said, "We hope this will be resolved soon and contained. Our biggest fear is the expansion of the conflict, as it would really have a significant impact on trade... Everyone is concerned and hoping for the best." She noted that global uncertainty is already limiting trade growth, and the sudden outbreak of war between Israel and Hamas, which controls the Gaza Strip, could intensify this.
She added, "There is uncertainty regarding the likelihood of this spreading to the entire region, which could greatly affect global economic growth... We hope this ends because it is causing this uncertainty. It is another dark cloud on the horizon." The Geneva-based organization last week halved its global merchandise trade growth forecast for this year due to persistent inflation, rising interest rates, slow growth in the Chinese economy, and the war in Ukraine. The WTO stated that goods trade volume is expected to grow only 0.8 percent in 2023, compared to its April estimate of 1.7 percent. For 2024, it indicated that goods trade growth could reach 3.3 percent, nearly unchanged from its April forecast of 3.2 percent.
