The Director-General of the World Trade Organisation, Dr Ngozi Okonjo-Iweala has said the organisation is “deeply saddened by the continued suffering and loss of life” as a result of the war in Ukraine.
She said this in a statement on Wednesday, as the war which has shocked the world and threatened global stability entered its seventh day.
The WTO had hoped that war would be averted but that hope was dashed.
With the battle raging on and talks between Ukraine and Russia yet to yield results, the WTO is concerned about the implications.
“We are also concerned about the trade implications of the conflict, especially trade in agriculture and food products and the rise in energy prices and their effects on the impacted population,” Dr Okonjo-Iweala said.
The WTO is praying for “a peaceful and quick resolution” to the crisis.
Dr Okonjo-Iweala warned about the “economic impacts” of the war in Ukraine, a major wheat exporter, saying it would hurt consumers around the world.
“There’s going to be a big impact with respect to wheat prices and prices of bread for ordinary people as well,” she said at a virtual event with IMF chief Kristalina Georgieva.
Dr Okonjo-Iweala noted that Ukraine “is one of the largest wheat exporters of the world.”
Georgieva echoed her previous warnings about the “significant economic risk” of the conflict for the global recovery from the Covid-19 pandemic, saying “the impact is going to go beyond Ukraine.”
She highlighted the added pressure on inflation which is likely to accelerate amid rising prices for energy and wheat.
Oil prices on Thursday briefly topped $100 for the first time since 2014.
The United States and Europe slapped sanctions on Moscow, targeting the financial sector but largely sparing the oil and agriculture sectors for now in an effort to mitigate the impact on their own people.
The sanctions “add to the economic impact of this crisis, and will transmit primarily through energy prices, as well as grain prices, adding to what has been a growing concern of inflation and how it can be countered,” the IMF chief said.
The conflict adds to the “high uncertainty” about the global economy that also is reflected in financial markets, and undermines confidence in other emerging markets causing an exodus of capital at a time when those countries need more funding.
“We see outflows from emerging markets when we need exactly the opposite,” she said.
Georgieva, who is Bulgarian, said she had a personal connection to the crisis, as her brother is married to a Ukrainian and they are in a city near the border with Russia.
“I know right now it’s so difficult to see a pathway to peace, but peace must be pursued and we must find a way to bring that peace that people are so desperate for.”
