IMF Chief Credits Absence of Tariff Retaliation for Global Growth
WASHINGTON, April 17 โ- The global โขeconomy is benefiting from the lack โof widespreadโ retaliatory โtariffs in responseโค to former U.S. President Donald Trump‘s trade policies, โฃInternational Monetary Fund (IMF) Managing Directorโ Kristalinaโ Georgieva said Wednesday. Thisโค restraint, despite significant trade โฃdistortions โcaused by the initial tariffs,โ has helped prevent aโค deeper slowdown in global growth, she stated duringโ a press โขconference at the IMF andโข World bank Spring Meetings.
Georgieva’sโข remarks come โขas global trade remains underโ pressure from geopolitical tensions andโ supply chain disruptions, but notably avoids a full-blown trade warโ scenario. while Trump-era tariffs on goods from countries like China remain largely in โplace, the absence of broad-basedโ retaliation from affected nations has been a โคcrucial factor inโ sustaining economic activity. The IMF chief emphasized that unwinding these tariffs would provide โa further boost toโ global growth, estimating a potential increaseโฃ of 0.5% to global GDP.
The IMF’s โlatestโค World economic โOutlook, โreleased earlier this week, projects โฃglobal growth at 3.2% โfor 2024 and 3.1% โฃforโ 2025 – a โคmodest but continued expansion. Georgieva acknowledgedโข that the global economicโค outlook is fragile,โข citing risks including persistent inflation, geopolitical โfragmentation, and rising debt levels. However, sheโฃ highlighted that the โคavoidanceโข of escalating trade conflictsโฃ has been a positiveโข force.
“The โfact that there wasโ not a โฃfull-blown retaliationโ to theโ tariffs thatโค were imposed is โsomething that, in retrospect, we can be grateful for,” Georgieva said. “Because had we seenโค a full-scale trade war, the โimpact on global growth would โฃhave been significantly more severe.”
The original tariffs, implemented beginning in 2018, targeted a wide range of goods, including steel, aluminum,โค and โคconsumer products. While intendedโข toโค protect domestic industries and reduce trade deficits, theyโฃ led to increased costs for businesses and consumers โฃand disruptedโข global supply chains. The Biden administration hasโ maintained many of โฃthese tariffs,โค while also pursuing new trade initiatives focused onโข strengthening relationshipsโ with alliesโฃ and addressing unfair trade practices.
The IMF continues to advocate for a โคrules-based multilateralโฃ trading system โขand encouragesโข countries to resolve trade disputes through the Worldโ Trade Institution (WTO). โGeorgieva’s comments underscoreโค the importance of international cooperation in โnavigating the complex challenges facingโ the global economyโฃ and avoiding protectionist measures that could further โundermine growth.
