International Trade Bulletin — May 5, 2025

1. WTO Revises 2025 Trade Forecast

The World Trade Organization now expects a 0.2% contraction in global merchandise trade in 2025, down sharply from earlier growth forecasts. It warns that renewed tariff escalations—especially under “reciprocal tariff” policies—could deepen the decline to 1.5%.

2. China’s Export Momentum Falters

China’s exports climbed 6.9% year‑on‑year in Q1 2025, yet April data reveal a sharp slowdown in new export orders. Analysts attribute this to the impact of elevated U.S. duties, marking a potential inflection point for the country’s export‑driven model.

3. Vietnam–U.S. Trade Talks Launched

Facing a looming 46% reciprocal tariff, Vietnam’s trade minister initiated negotiations with U.S. Trade Representative Jamieson Greer. Washington has suspended the tariff until July, but both sides emphasize the need for dialogue free of coercion or extortion .

4. Manufacturing Sector Under Pressure

April’s ISM Manufacturing PMI fell to 48.7—the lowest in five months—reflecting supply‑chain disruptions, higher input costs, and weaker new orders following recent tariff hikes by the U.S.

5. GM’s Canadian Plant Adjustments

General Motors will cut back to two shifts at its Oshawa Assembly plant in Ontario, affecting approximately 700 workers. The move responds to softer demand and trade‑related sourcing challenges, as the company reallocates production to its U.S. facilities.

6. EU Pursues New Trade Partnerships

The European Union has finalized a landmark Digital Trade Agreement with South Korea and announced a $5.1 billion investment package for South Africa, part of its strategy to diversify beyond traditional markets amid global trade upheaval.

7. Economists Flag Recession Risk

A recent Reuters poll shows that a majority of economists now see a better‑than‑even chance of a global recession in 2025, driven by persistent trade tensions and policy uncertainty.