Foreword

Stephen Millard ()

National Institute Global Economic Outlook, 2025, issue 18, 3-4

Abstract: When thinking about the outlook for the global economy, this quarter has been dominated by events around 'Liberation Day' – 2 April – on which President Donald Trump announced a slew of what he called 'reciprocal tariffs' varying from 10 per cent to 54 per cent depending on the country. These tariffs had nothing to do with the tariffs imposed on US goods by other countries; indeed, tariffs were imposed on the uninhabited Heard Islands and McDonald Islands! Rather, the size of each country's tariff was based on the size of the bilateral trade deficit the United States had with that country. Leaving aside the facts that bilateral trade deficits are a normal part of a healthy trading system and that the proposed policy flew in the face of obligations the United States had as a member of the World Trade Organisation, the announcement of these tariffs threatened to disrupt the whole global trading system and the global supply chains that had been built up over recent decades. To give a feel for how negatively these tariffs could affect the world economy, it just needs to be noted that they were on a par with the tariffs put into place by the Smoot-Hawley Act in 1930, which contributed to a collapse in world trade, as other countries retaliated, and prolonged the Great Depression.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.niesr.ac.uk/publication-type/global-economic-outlook
Subscription required to access full text, see https://www.niesr.ac.uk/subscribe-national-institute-global-economic-outlook

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nsr:niesrb:i:18:y:2025:3-4

Access Statistics for this article

More articles in National Institute Global Economic Outlook from National Institute of Economic and Social Research 2 Dean Trench Street Smith Square London SW1P 3HE. Contact information at EDIRC.
Bibliographic data for series maintained by Library & Information Manager ().