UN Warns of Global Economic Threat from US Tariffs
New York, Thursday, 17 July 2025.
The United Nations predicts US tariffs under President Trump threaten global economic stability, possibly reducing growth and harming jobs worldwide, impacting developing nations’ exports by up to 54%.
Cascading Economic Effects
The recent warning from the United Nations underscores the far-reaching ramifications of the tariff policies implemented by President Trump. These tariffs, targeting imports from several countries, are predicted to diminish global growth by 0.5 percentage points, lowering it from 2.8% to 2.3% in 2025 [1]. The economic impact of these tariffs extends beyond the immediate trade disputes, affecting industries and markets worldwide through increased costs and supply chain disruptions [2].
Impact on Developing Economies
A significant aspect of the UN’s warning is the projected impact on the least developed countries (LDCs). With as many as 46 nations categorized under the LDC bracket, their exports may reduce by as much as 54% if the tariffs are enforced [1]. Notably, Cambodia’s economy, with exports to the U.S. contributing over 10% of its GDP, risks losing over $4.5 billion in exports over the next four years, which could severely strain its economic health [2].
Shifts in Global Supply Chains
The tariffs are catalyzing a re-routing of global supply chains as nations like Vietnam, Cambodia, and Malaysia adjust to shift their dependencies away from the ‘China Plus One’ strategy [1][3]. This strategic pivot is reshaping how these countries interact within the global market, creating both challenges and opportunities as they seek to accommodate new demand and fill gaps left by disrupted Chinese supply chains.
Domestic Implications and Inflation
Domestically, the U.S. is experiencing its own set of challenges as consumer inflation continues to rise, largely driven by the increased costs of imported goods subject to the new tariffs [1]. Analysts warn that these tariffs could effectively negate the financial advantages provided by the 2017 tax cuts by raising the average annual tax burden by approximately $1,300 per U.S. household in 2025 [4]. This increased cost of living could counteract any perceived economic gains from past fiscal policies, adding pressure to American consumers.