US tariffs could shrink global trade: UN economist.
Last week, former U.S. President Donald Trump introduced a sweeping new tariff plan that could have significant implications for both domestic and international trade. The proposal includes broad duties on imported goods, aimed at boosting American manufacturing and protecting U.S. industries from foreign competition. Trump’s announcement has sparked widespread debate among economists and global leaders, many of whom are concerned that the policy could escalate trade tensions and disrupt global supply chains. The plan is part of his broader economic agenda as he positions himself for a possible return to the presidency.
UN Economist Warns: US Tariffs Could Shrink Global Trade by 3% as Export Routes Shift
The United Nations has issued a cautionary note on the potential repercussions of the United States’ latest tariff measures, stating that global trade could shrink by as much as 3 per cent. The warning follows the unveiling of a massive tariff plan by former U.S. President Donald Trump last week, triggering widespread concern among global economists and trade experts.
While the White House later announced a 90-day pause on what it described as “reciprocal tariffs” for most countries, China was notably excluded. In retaliation, Beijing imposed a staggering 125 per cent tariff on U.S.
Trade patterns and economic integration.” She explained that the landscape of global exports is undergoing a major transformation due to the new U.S. tariffs and corresponding measures taken by affected countries.
A key sector affected by the tariff impositions is apparel, which plays a vital role in the economies of developing nations. If the proposed 37 per cent reciprocal tariff against Bangladesh takes effect, the South Asian nation could lose as much as USD 3.3 billion in exports to the United States by 2029.
She emphasized that countries should not only respond to these shocks but prepare proactively. value addition, and regional integration,” she noted. These strategies, she believes, could provide long-term resilience and help mitigate the impact of sudden shifts in trade policy.
90-day pause and China’s 125 per cent tariff hike—suggest that the cumulative effect of these trade measures could lower global GDP by approximately 0.7 per cent by the year 2040. She identified countries like Mexico, China, and Thailand, as well as several nations in Southern Africa, among the most severely affected. Notably, the United States itself is expected to face economic setbacks.
Meanwhile, reaction from other global policy observers underscores the growing alarm over the trade standoff.
Cutler added that China appears ready to endure a prolonged economic standoff and hinted that Beijing may deploy additional strategies beyond tariffs if the United States escalates further.
U.S. goods entering China—have reached levels that effectively halt all goods trade between the two superpowers.
He said that while Chinese President Xi Jinping is not backing down, he is also not provoking further escalation. market response,” Russel commented.
Russel observed that Beijing is transitioning away from tit-for-tat retaliation, signaling a shift in strategy. “By declaring it will ‘ignore’ future U.S.
He elaborated that China’s broader goals now seem to include buffering its economy against external shocks, expanding its diplomatic influence, and encouraging U.S. allies to reconsider their allegiance. Xi Jinping’s recent tour of Southeast Asia, according to Russel, is part of this long-term plan to strengthen regional economic ties while the United States appears to alienate its partners.
The emerging scenario paints a picture of a world bracing for a prolonged era of disrupted trade, new alliances, and economic reorientation. While the full impact of the U.S. tariff policy may take years to materialize, early signals indicate that the shockwaves are already being felt across continents, industries, and governments.