The global economy is poised for acceleration in 2025, driven by a combination of technological advancements, increased consumer spending, and robust investment in infrastructure. However, this optimistic outlook is tempered by the looming threat of higher tariffs, which could undermine the recovery efforts.
The Organization for Economic Co-operation and Development (OECD) has highlighted that while the world economy is set to grow, the imposition of higher tariffs could disrupt international trade and supply chains. These tariffs, often a result of geopolitical tensions and trade disputes, can lead to increased costs for businesses and consumers, ultimately slowing down economic growth.
One of the key drivers of the anticipated economic acceleration is the continued recovery from the global pandemic. As countries emerge from the economic downturn caused by the pandemic, there is a renewed focus on rebuilding and strengthening economies. This includes significant investments in digital infrastructure, green technologies, and healthcare systems, which are expected to spur economic activity and create new job opportunities.
Consumer spending is also projected to rise, fueled by pent-up demand and increased savings accumulated during the pandemic. This surge in spending is likely to boost various sectors, including retail, hospitality, and travel, contributing to overall economic growth.
However, the OECD warns that the positive momentum could be derailed by protectionist policies and higher tariffs. These measures can lead to trade barriers, making it more difficult for countries to access essential goods and services. The resulting increase in costs can stifle innovation, reduce competitiveness, and hinder economic progress.
To mitigate these risks, the OECD advocates for international cooperation and the reduction of trade barriers. By fostering a more open and collaborative global trade environment, countries can ensure a smoother and more sustainable economic recovery. This approach not only benefits individual economies but also strengthens the global economic system as a whole.
In conclusion, while the world economy is expected to accelerate in 2025, the potential impact of higher tariffs poses a significant threat to this recovery. It is crucial for policymakers to prioritize international cooperation and the reduction of trade barriers to support sustained economic growth and stability.
