Roberto Azevedo, WTO: The world is in a very delicate moment in trade relations

The World Trade Organisation (WTO) warned that a trade war might have repercussions all over the world and urged nations to avoid lifting the tension. The statement was made at a conference in Lisbon, according to Bloomberg, where Roberto Azevedo, director-general of WTO, said that we are in a very delicate moment in trade relations between world’s largest economies.

Many countries are trying now to respond to Donald Trump’s decision to impose steel and aluminum tariffs on most of the partners, granting temporary to some allies. China is among those worst hits, with USD 50 billion additional taxes on its products so it has already called for more talks. Also, Xi Jinping’s government fired back by imposing import levies on 128 American commodities totaling USD 3 billion in exports, including pork, meat, wine, fruit and more.

“An escalation of these frictions will have very negative consequences for global economic growth and for job creation”, said Azevedo.

“We have to be worried about the motivations behind those tensions ant the potential systemic consequences. It’s important to avoid an escalation,” he added.

The head of WTO also said that he is in contact with all the countries trying to find constructive solutions for the matter.

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The general fear for an escalation in the war trade has already caused the Dow Jones Industrial average to fall almost 2 percent yesterday. If there will not be an easing in the tension, the stock market may enter a downward spiral, creating risk aversion among investors all over the world.