The International Monetary Fund (IMF) has warned that the global economy is expected to slow sharply this year due to President Donald Trump’s imposition of high import taxes. The 10% tax on all imported goods, combined with higher levies on goods from dozens of nations, will hurt both the US and its trading partners.
According to the IMF, the US economy is projected to grow at an annual rate of 1.8%, a third lower than its previous estimate. This slowdown is attributed to the increased costs imposed by Trump’s tariffs, which will lead to higher prices, reduced competition, and decreased innovation across the US economy.
The fund also predicted that US trading partners, particularly China, will experience slower growth due to the tariffs. China’s growth is expected to slow to 4% this year, down from its previous forecast of 5%.
In a statement, IMF Chief Economist Pierre-Olivier Gourinchas described the current economic situation as “a new era” for global trade, where investors are struggling to find their footing due to the uncertainty and volatility caused by Trump’s policies.
While some experts argue that Trump’s tariffs are justified to address unfair trading practices, most mainstream economists oppose them. The IMF has warned of potential risks, including a further escalation in the trade war, financial instability, or even a large emerging-market economy debt crisis.
Gourinchas emphasized the need for cooperation and rules-based global trade to improve growth prospects immediately. However, key elements of the future trade system remain dependent on Trump’s ability to hammer out multiple trade deals within his tight 90-day timetable.
Source: https://www.washingtonpost.com/climate-environment/2025/04/22/trump-tariffs-imf-global-economy