‘Time for dialogue, not escalation’ – This is the call from the UN Trade and Development (UNCTAD) agency as major economies prepare to impose sweeping new tariffs in response to reciprocal tariffs announced by U.S. President Donald Trump.

UNCTAD warns that the global trade system is entering a critical phase, with the most vulnerable economies likely to bear the brunt.

Just 10 of the nearly 200 U.S. trade partners accounted for almost 90% of its trade deficit, according to UNCTAD statistics.

“Yet, for example, least developed countries and small island developing states contribute just 1.6% and 0.4% of the deficit, respectively, and are still being affected. They will neither help balance the trade deficit nor generate significant revenue,” said UNCTAD Secretary-General Rebeca Grynspan.

Grynspan called for dialogue and negotiations, emphasising that trade imbalances, concentrated gains, and outdated rules must be addressed without sacrificing those least responsible.