Foreign economists are sounding the alarm as US leader Donald Trump plans to impose the largest trade restrictions in 100 years. This decision will be a powerful blow to the global trading system and will provoke many serious problems.
Points of attention
- The global trade policy uncertainty index has reached its highest level since 2009, indicating the heightened risk and instability associated with Trump's trade decisions.
- Under the maximum approach, the average tariff rates in the US could increase to 28 percentage points, resulting in a significant decline in GDP and a notable increase in prices over the next few years.
Trump is capable of destroying the global economy
A statement on this occasion was made by Nomura Holdings Inc. Chief Economist Rob Subbaraman.
He points out that the lack of details about the structure, size and purpose of the tariffs has left the world "flying blind".
According to the expert, about $33 trillion in global trade could be affected by Donald Trump.
It is also impossible to ignore the fact that the global trade policy uncertainty index soared to its highest level since 2009 on April 1.
A group of economists from Goldman Sachs Group Inc. has suggested that the average U.S. tariff for all countries in 2025 will likely increase by 15 percentage points.
There is a high probability that this, in turn, will trigger an increase in core inflation, weakening growth and increasing the risk of recession.
Under the maximum approach, average tariff rates in the US would increase to 28 percentage points, leading to a 4% decline in US GDP and an increase in prices of almost 2.5% over two to three years.
