On Wednesday, the World Trade Organization (WTO) projected that the trade conflict between the U.S. and China could reduce the exchange of goods between the two nations by up to 80%.
The WTO noted that the ongoing back-and-forth between the world’s two largest economies, which together represent about 3% of global trade, could have far-reaching consequences that might significantly harm the global economic outlook.
The WTO also warned that splitting the global economy into two separate blocs could result in a long-term decrease in global real GDP by nearly 7%.
This preliminary estimate was released around the time U.S. President Donald Trump increased tariffs on Chinese imports while temporarily suspending others for 90 days.
