Global mistrust hurting business, trade, Okonjo-Iweala

The erosion of trust between nations poses one of the most significant threats to global trade, investment, and economic stability, according to World Trade Organisation Director-General Ngozi Okonjo-Iweala. Speaking at the 20th anniversary celebration of commercial law firm Streamsowers & Köhn in Lagos, she emphasized that this rising mistrust breeds uncertainty, which is detrimental to businesses across the globe.

Okonjo-Iweala observed a shift from "cooperative multilateralism" to a more competitive international order where countries increasingly view each other as rivals. She stated that nations once considered reliable partners are now questioning each other's intentions, resulting in conflicts, missed opportunities, and a fragmented global economy. "The single biggest issue, the trust of countries in the world in each other has deteriorated because countries are seeing actions by those they thought were trustworthy that are no longer believable," she said.

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The single biggest issue, the trust of countries in the world in each other has deteriorated because countries are seeing actions by those they thought were trustworthy that are no longer believable. This current mistrust is not good for the world. Mistrust leads to uncertainty, which is very bad for business.

However, the WTO chief expressed optimism that global cooperation can ultimately prevail, stressing that no single country can address complex global challenges alone. Issues like climate change, disease outbreaks, and water security necessitate collective action. Okonjo-Iweala believes governments will eventually recognize the need to rebuild trust and strengthen international cooperation.

Despite escalating geopolitical tensions, Okonjo-Iweala pointed out the remarkable resilience of global trade. She revealed that approximately 72 percent of world trade continues to operate under WTO rules. She explained that many countries, including Australia, Singapore, New Zealand, and the United Kingdom, adhere to multilateral trading rules because they offer greater long-term benefits compared to prolonged trade disputes.

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In spite of all these disruptions, global trade has been very resilient. Seventy-two per cent of world trade still goes on WTO terms, and people are shocked when I say that.