Consequences of Trump policy Global trade could fall by up to 1.5 percent due to tariffs
16.04.2025, 15:08
16.04.2025, 15:18
SDA
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- The WTO is forecasting a massive slump in economic growth for North America (0.4% instead of 2%) and sharp declines in exports (-12.6%) and imports (-9.6%) due to US tariffs.
- Europe remains comparatively less affected by the tariffs, but must expect a slight decline in GDP growth and reduced trade growth.
- While Chinese exports to the USA are falling drastically (-77%), they are rising in other regions, which is causing new trade shifts worldwide.
According to an analysis by the World Trade Organization (WTO), the US tariffs will have the greatest impact on the USA itself - and Canada. Apart from the volume of trade, economic output will also suffer greatly: The WTO expects gross domestic product (GDP) in North America to grow by only 0.4 percent this year instead of 2 percent. It only presents its data for the USA and Canada combined.
According to the WTO analysis, exports in North America are likely to fall by 12.6 percent this year and imports by 9.6 percent. Prior to the tariff announcements, it had expected exports to rise by 2.2 percent and imports by 2.8 percent. According to WTO forecasts, Chinese exports to the USA will fall by 77 percent in the current scenario.
Europe less affected
For Europe, the consequences are much less dramatic: plus one percent exports (instead of the previously expected 1.4 percent) and plus 1.9 percent imports instead of 2.1 percent. In terms of GDP, the WTO predicts 1.2% growth for Europe this year instead of 1.4%.
This is a snapshot with the tariff rules in force on April 14. The USA has already imposed tariffs and announced further ones, but has largely suspended them for 90 days. If the current scenario continues, the volume of goods traded worldwide is likely to shrink by 0.2% instead of growing by 2.7% as previously expected.
However, if the suspended tariffs do come into effect and counter-tariffs and uncertainty spread, the WTO predicts a decline in trade volume of up to 1.5 percent. The WTO still expects global GDP to grow by 2.2 percent in 2025, down from the 2.8 percent it had expected before the US tariff announcements.
Concerns about more Chinese competition
The high US tariffs on Chinese products have led to concerns about competition in other countries. The WTO expects Chinese exports to all regions outside North America to grow by 4 to 9 percent this year, and by 6 percent to Europe. On the other hand, there are new export opportunities to the USA if significantly fewer textiles, clothing and electrical appliances are imported from China.
According to WTO figures, trade volumes grew by 2.9% and global GDP by 2.8% in 2024. In dollar terms, trade expanded by two percent to 24.4 trillion dollars (just under 21.5 trillion euros).
With material from DPA
