The tariffs imposed by US President Donald Trump on almost the entire world, and the countermeasures of other countries, could have “catastrophic” consequences for developing countries, a United Nations agency warned on Friday.
World trade could fall by between three and seven percent, and countries’ GDP by 0.7 percent. Developing countries will be hit hardest, the International Trade Center (ITC) warned.
“This is huge,” said Pamela Kok Hamilton, executive director of the UN agency.
“If the escalation between China and the United States continues, it will result in a drop in trade between the two countries by 80 percent, and the domino effect of that could be catastrophic everywhere.”
World markets continued to face turbulence on Friday, even though Trump announced that he was postponing the introduction of tariffs on everyone except China for 90 days. He raised tariffs on the Asian country to 145 percent.
Beijing responded with counter-tariffs on the United States, so they are currently at 84 percent.
“Tariffs could have a significantly more damaging impact than cutting foreign aid,” said Kok Hamilton, warning that developing economies risk losing the economic progress made in recent years.
The ITC bases its projections on data that does not take into account the 90-day pause, nor the additional tariffs from China and the United States.
