OECD: Global Economic Outlook ‘Increasingly Challenging’ amid TariffsBerlin, 3 Jun (ONA) — The global economy is facing “increasingly
challenging” prospects, the Organisation for Economic Co-operation
and Development (OECD) said today, with new tariffs highlighted among
factors that are likely to hamper growth worldwide.
The OECD revised its projection of global gross domestic product
(GDP) growth for 2025 from 3.1% to 2.9% – noting that the estimate
was based on the assumption that tariff rates are sustained as of
mid-May.
For 2026, the OECD downgraded its growth outlook from 3% to 2.9%.
The 38-member organization pointed to “substantial increases in trade
barriers, tighter financial conditions, weakened business and
consumer confidence, and elevated policy uncertainty” as the main
risks to economic development.
“Rising trade costs – particularly in countries implementing new
tariffs – are likely to fuel inflation, although this may be partly
offset by softer commodity prices,” it said.
The United States, Canada, Mexico and China – the four countries at
the centre of the trade war unleashed by US President Donald Trump –
will face the burden of the slowdown, the OECD predicts, while other
economies are expected to be somewhat less impacted.
In the US, GDP is projected to slow to 1.6% in 2025, down from 2.8%
growth seen last year (2024).
Meanwhile, Germany’s languishing economy is likely to see growth of
0.4% this year, after seeing two consecutive years of recession.
— Ends/Khalid