The World Trade Organization (WTO) Director-General Ngozi Okonjo-Iweala (C) speaks at a press conference on WTO's latest Global Trade Outlook and Statistics report at the WTO headquarters in Geneva, Switzerland, Oct. 7, 2025. (Xinhua/Ma Ruxuan)

The World Trade Organization (WTO) has predicted that global trade growth is likely to slow sharply in 2026 due to the weak global economic recovery and the impact of tariffs. China has urged members to work together to address mounting trade disruptions and safeguard multilateralism during a General Council meeting held in Geneva.

The forecast for global merchandise trade growth in 2026 has been slashed to 0.5 percent, down significantly from the 1.8 percent projected in August, according to the updated WTO report released on Tuesday.

Given the close links between merchandise trade and production, the WTO said that trade in services will also be affected by the tariff shocks. The growth of global services exports is expected to slow from 6.8 percent in 2024 to 4.6 percent in 2025 and 4.4 percent in 2026, the report said.

The report noted that global goods trade outpaced expectations in the first half of 2025, driven by increased spending on artificial intelligence-related products, a surge in North American imports ahead of tariff hikes, and resilient trade among other regions. It raised the 2025 forecast to 2.4 percent, up from 0.9 percent in August. 

However, higher tariff rates and elevated trade policy uncertainty are likely to offset these gains, a WTO news release on Tuesday said, cautioning that "with higher tariffs taking effect in August, some of the impacts projected are now likely to materialize later in the year and into 2026." 

WTO economists further warned that the key downside risk to the forecast lies in the spread of trade restrictions and policy uncertainty to more economies and sectors, according to the release.

WTO Director-General Ngozi Okonjo-Iweala urged countries to "reimagine trade and together lay a stronger foundation" amid current disruptions, and underscored the need for fundamental reform of the organization.

Huo Jianguo, vice chairman of the China Society for World Trade Organization Studies in Beijing, told the Global Times on Wednesday that the sharp downgrade mainly reflects the adverse impact of US tariffs and protectionism, as well as the broader uncertainty they have triggered worldwide.

"This year's global trade growth has already faced notable challenges, and if the unilateral US moves remain unresolved through the end of the year, the shocks and volatility to the trading system next year will be even more severe," Huo said.

At the WTO General Council meeting held in Geneva on Monday and Tuesday, China called on all WTO members to collectively address the escalating trade turbulence and uphold the core values and principles of the multilateral trading system, the Xinhua News Agency reported on Wednesday.

China's Permanent Representative to the WTO Li Yongsheng said that US trade policies have disrupted supply chains and global markets, becoming a major source of instability worldwide. He stressed that Washington's use of unilateral tariffs to pressure certain members into bilateral deals - at the expense of third parties' legitimate rights - is eroding the rules-based multilateral trading system.

"As a responsible major developing country, China has long made every effort to contribute to global development, and has been actively engaged in multilateral trade negotiations, supported Aid for Trade initiatives, and worked to promote development through trade," Li said.

During Tuesday's meeting, China also submitted its position paper on Special and Differential Treatment (SDT) in the WTO, following its announcement on September 23 that it would not seek new SDT in ongoing and future WTO negotiations.

"This position paper represents China's concrete effort to uphold the multilateral trading system and place development issues at the heart of the WTO's work. It also reflects China's active implementation of the Global Development Initiative," Li said.

WTO members spoke highly of China's announcement. Jamaica and Senegal hailed it as a move of "historic significance," demonstrating China's firm commitment to multilateralism and its role in strengthening the rules-based trading system, Xinhua reported.

Pakistan, Egypt, and Barbados praised China for embodying the image of a responsible developing major country and for helping to preserve solidarity among developing nations, which will contribute to advancing the WTO's development agenda, the Xinhua report said.

Singapore noted that China's decision reflects confidence in its own development path and a strong resolve to reinforce the multilateral trading system. Members including the EU, Australia, Switzerland, and Norway welcomed China's major decision, viewing it as a move that will inject fresh momentum into the WTO reform process, according to Xinhua.

"US unilateralism has become a destructive force undermining the global trading system, and China, as a major trading nation, firmly advocates for safeguarding the multilateral trading framework to stabilize global trade order," Huo said.

At the meeting, Li also proposed three key measures to tackle the escalating trade turmoil: strengthening transparency and oversight, collectively reaffirming commitment to the rules-based multilateral trading system, and taking concrete steps to deliver tangible outcomes in the WTO.