Donald Trump reduces American funding from the World Trade Organization: what to know

The United States has suspended its contributions to the World Trade Organization (WTO), reported Reuters, citing three commercial sources.

The context

Reuters reports are involved while the Trump administration continues to adopt protectionist trade policies and intensifies its efforts to considerably reduce public spending.

President Donald Trump also put the United States in broader distance from international institutions that he and his allies consider to be in conflict with their “America First” economic program.

This change includes the imposition of steep prices to American trade partners and to move away from international organizations, including the WTO, the World Health Organization, the United Nations and foreign aid initiatives.

President Donald Trump speaks during a reception celebrating the month in the history of women in the east room of the White House, Wednesday March 26, 2025, in Washington. President Donald Trump speaks during a reception celebrating the month in the history of women in the east room of the White House, Wednesday March 26, 2025, in Washington. Jacquelyn Martin / AP what to know

The WTO has already been considerably weakened by Trump's decision in 2019 to block the appointment of new judges to its court of appeal.

This action left the mechanism of settlement of the WTO disputes only partially operational, because Washington accused the Appeal organization of exceeding its authority in commercial decisions.

In 2024, the WTO operated with an annual budget of 205 million Swiss francs (around 232 million dollars). Based on a contribution system linked to the share of each world trade member, the United States is expected to provide around 11% of this total, Reuters reported, citing public WTO files.

Earlier this week, Trump announced that his administration would impose a 25% price on unabled cars in the United States, in a move, the White House said it was to stimulate national manufacturing, although it can also reduce car manufacturers dependent on international supply chains.

The price will take effect on April 2, said Trump, the appellant “Liberation Day”.

Although the White House projects that new prices will generate $ 100 billion in annual income, industry analysts and economists through the spectrum warn that it could seriously disrupt global supply chains and cause higher prices for consumers.

Despite these concerns, Trump defended prices as a means of bringing manufacturing to the United States, calling on the current “ridiculous” cross-border supply chains and declaring that “this is permanent”.

Trump’s announcement sparked an immediate flame return from leaders of the best American business partners, including Canada and the European Union.

What people say

Canadian Prime Minister Mark Carney said on Wednesday: “This is a very direct attack. We will defend our workers. We will defend our businesses. We will defend our country.”

The president of the European Commission, Ursula von der Leyen, said on Wednesday in a statement: “Prices are taxes-BAD for companies, worse for consumers also in the United States and in the European Union,” she said, adding that the EU executive power would assess the impact of this decision, as well as other American tariffs scheduled for the next few days.

What happens next

Sources have told Reuters that the United States could cope with WTO penalties according to the organization's rules, who say that any member who does not pay his contributions after more than a year could be subject to “administrative measures” which become more strict, the more the costs are not remunerated.

Update 03/27/25 13:50 PM HE: This story has been updated with additional information and a context.

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