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WTO faces deepening global trade tensions

WTO faces deepening global trade tensions - global trade
With 166 members representing about 98% of global trade, the foreseen impacts would be monumental, cutting across continents.

World Trade Organization (WTO) Director-General Ngozi Okonjo-Iweala now leads an institution grappling with deepening mistrust among member nations as they handle modern trade trends. Unlike its postwar origins—built on the assumption that shared global rules would support mutual benefit—the current system has pivoted toward contested priorities like subsidies, artificial intelligence, climate policies, and national security concerns. This evolution reflects broader geopolitical tensions, from supply chain realignments to rising tariffs, fundamentally altering the trade environment she must now steer.

The Challenge Ahead

Ngozi Okonjo-Iweala, an economist and the first African woman to serve as WTO Director General, is working through the challenges of the evolving global economy. The WTO’s report released in September 2026, describes the world trading system as being at a critical juncture, warning that inaction to modernize global trade rules could shrink global output by up to 10%, while enhanced collaboration could boost global GDP by approximately 2.9% by 2050.

With 166 members representing about 98% of global trade, the foreseen impacts would be monumental, cutting across continents. Okonjo-Iweala’s role requires determining if a global trading framework developed in a past era can be reformed to meet the demands of emerging economies seeking more influence, especially as powerful nations question the value of global cooperation.

Africa’s Economic Positioning

Okonjo-Iweala’s position is especially important because this question holds great significance for Africa. African nations have mostly engaged in global trade with limited negotiating power, but the African Continental Free Trade Area promises to alter this by establishing a unified market across the continent.

Africa needs greater control over the rules that govern its trade with the world. The WTO continues to be the essential structure that oversees and safeguards most international commerce, a complex environment Okonjo-Iweala manages as the leader where governments discuss trade agreement regulations. Less developed countries, including many African economies, contribute less than one percent of world trade and encounter significantly higher costs in international trade participation.

The WTO’s 2026 report identifies four forces piling pressure on the existing system: shifting economic power, greater government intervention, changes in the nature of trade, and rising geopolitical tensions. Having served at the World Bank for 25 years and as Nigeria’s finance minister twice before the WTO, Okonjo-Iweala has a 360-degree view of the processes, systems, and impact of global trade rules on African economies.

Low and middle-income economies now account for about 45% of global merchandise trade, a significant growth in comparison to previous years. However, this greater economic strength has not led to proportional influence over trade rules, creating tension in the global economy and driving power shifts. As Africa’s economic role in global trade changes, someone must advocate for its inclusion in trade decisions and increased political influence.

As a major economic voice, Okonjo-Iweala provides Africa with an opportunity, though it is essential to recognize she represents more than just Africa. The WTO asserts that its regulations must adjust to new technologies and government interventions instead of indefinitely maintaining the current state. Fragmentation of the global economy would leave every country to seek and serve its own interests, presenting unpredictability that could greatly disenfranchise smaller economies since they have less leverage when negotiating individually with major economic powers.

Imperfect as the WTO is, a rules-based global governing system gives smaller economies a common framework in which their interests are articulated. Okonjo-Iweala’s role brings her directly to the issue of whether Africa’s growing economic presence will result in greater inclusion in global value chains and improved opportunities for African businesses. This question arises from the inequalities African economies face, as the WTO itself acknowledges that less developed nations encounter higher trade costs than wealthy ones.

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