.){kind=link}
The global economy is facing precarious moment due to rising trade conflicts and growing policy uncertainties, according to the United Nations Department of Economic and Social Affairs (UN DESA).
In its latest report released on Thursday, the agency warned that increasing tariffs are fueling inflationary pressures, putting economies with high trade dependence at greater risk.
The report highlighted how disruptions in trade policies and higher import duties are straining global supply chains, raising operational costs, and hindering investment decisions—developments that could stall global growth momentum.
The slowdown is widespread, with both industrialized and developing nations feeling the impact. In the United States, growth is forecast to decline sharply as tariff hikes and policy instability dampen consumer activity and business investments.
Emerging economies such as Brazil and Mexico are also facing downward revisions to their economic outlooks, the report said.
In China, economic expansion is expected to decelerate to 4.6 percent this year, compared to 5.0 percent in 2024.
This is attributed to weakening consumer demand, obstacles in manufacturing exports, and ongoing issues within the real estate sector.
By early 2025, inflation rates had risen above pre-pandemic levels in roughly two-thirds of countries, with more than 20 developing nations experiencing inflation in the double digits—despite a drop in overall global inflation between 2023 and 2024.
Food prices remain persistently high, especially in Africa and parts of South and West Asia, where inflation in the sector has stayed above six percent. This trend continues to hit poorer households the hardest.
Rising trade restrictions, combined with climate-related disruptions, are driving inflation even higher, the report emphasized, calling for coordinated international action to address price instability and protect vulnerable populations.
“The impact of rising tariffs could be especially severe for fragile economies in the developing world,” said Li Junhua, UN Under-Secretary-General for Economic and Social Affairs.
As central banks attempt to manage inflation without stalling growth, many countries—particularly in the Global South—lack the fiscal space to respond effectively to economic shocks, the report noted.
This challenging landscape, UN DESA warned, threatens to derail progress on employment, poverty alleviation, and efforts to reduce inequality in many lower-income nations.