Geneva (Reuters) – Massive customs duties and countermeasures decided by US President Donald Trump may have a “catastrophic” impact on developing countries, hitting even harder than foreign aid reductions, the Executive Director of the United Nations Trade Agency said on Friday.
Global trade could contract in this context from 3% to 7% and the global gross domestic product of 0.7%, the developing countries being the most affected, said the Center for International Commerce.
“It’s huge,” said Reuters Pamela Coke-Hamilton, executive director of the International Trade Center. “If climbing between China and the United States continues, it will lead to a reduction of 80% of trade between the two countries, which could have catastrophic impact on all sectors,” she added.
Anxiety continued to weigh on the world markets on Friday due to the major commercial escalation between the United States and China, the two major world powers announcing almost daily retaliatory measures in the form of severe customs duties.
The latest reprisals come from China, which announced this Friday that it would bring its customs duties to 125% on American products imported from April 12, in reaction to the announcement by Donald Trump of a surcharter now weighing down 145% on Chinese goods.
“Customs duties could have a much more harmful impact than the abolition of foreign aid,” said Pamela Coke-Hamilton, warning that developing savings are likely to reverse economic gains made in recent years.
According to the ITC, some of the least developed countries in the world, such as Lesotho, Cambodia, Laos, Madagascar and Myanmar, could seek to improve their regional trade relations in order to absorb the loss of part of the American market for their exports.
Bangladesh, the second world’s second exporter of clothing, could lose $ 3.3 billion in annual exports to the United States by 2029 if American customs duties of 37% are maintained after the 90-day break announced by Donald Trump, according to ITC data.
On the other hand, it could turn to European markets, which still have growth potential, suggested Pamela Coke-Hamilton.
ITC projections are based on the data collected before the 90 -day break announced Wednesday by Donald Trump on some of his customs duties – with the notable exception of those imposed on China – and subsequent increases on the samples against Beijing.
(Report Olivia Le Poidevin, Diana Mandia, edited by Augustin Turpin)
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