{"id":3727,"date":"2025-08-17T00:56:21","date_gmt":"2025-08-17T00:56:21","guid":{"rendered":"https:\/\/www.europesays.com\/ie\/3727\/"},"modified":"2025-08-17T00:56:21","modified_gmt":"2025-08-17T00:56:21","slug":"new-american-president-trump-tariffs-trade-war-and-economic-turmoil-global-growth-set-to-crash-to-nearly-three-per-cent-in-2025-us-recession-fears-soar","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/ie\/3727\/","title":{"rendered":"New American President Trump Tariffs, Trade War and Economic Turmoil: Global Growth Set to Crash to Nearly Three Per Cent in 2025, US Recession Fears Soar"},"content":{"rendered":"

Home<\/a> \u00bb America Travel News<\/a> \u00bb New American President Trump Tariffs, Trade War and Economic Turmoil: Global Growth Set to Crash to Nearly Three Per Cent in 2025, US Recession Fears Soar <\/p>\n

Published on
\nAugust 15, 2025<\/p>\n

By: Tuhin Sarkar<\/a><\/strong><\/p>\n

\"\"<\/p>\n

The world economy is heading into turbulent waters, with growth expected to slow sharply in 2025, nearly three per cent. According to Euromonitor\u2019s latest outlook, global GDP could fall from 3.1% in 2024 to just 2.9% next year. The combination of escalating U.S. tariffs, intensifying trade tensions, geopolitical conflicts, and climate extremes is creating a perfect storm for global markets. The risks are not just economic; they are structural, with supply chains, commodities, and travel flows all feeling the strain.<\/p>\n

In the United States, the warning signs are growing louder. Real GDP growth is now forecast to dip to 1.6%, down from earlier projections of 2.1%, while inflation is set to rise to 3%. Under a worst-case \u201cTotal Trump\u201d trade agenda scenario, inflation could spike to 5.3%, pushing the country towards a policy-driven recession by 2026. For global businesses, the stakes are even higher \u2014 U.S. tariffs could cost companies as much as USD 1.2 trillion, while manufacturers face a potential 20% rise in component costs.<\/p>\n

Climate-related disruptions are compounding the challenges. Extreme weather events and political instability are driving commodity prices higher, adding up to 1 percentage point to global inflation. In this climate of uncertainty, Asia Pacific \u2014 particularly India and Southeast Asia \u2014 stands out as a rare bright spot, offering resilience and growth potential. However, for the majority of economies, the road ahead will demand agility, innovation, and strategic resilience to survive the headwinds of tariffs, trade wars, and economic volatility.<\/p>\n

Global Economy Set to Lose Momentum in 2025<\/p>\n

The world economy is bracing for a slowdown in 2025. Growth is forecast to fall from 3.1% in 2024 to 2.9%, according to Euromonitor. The drag comes from U.S. tariffs, worsening conflicts, and extreme climate events. The risk of a full-scale trade war is now a pressing concern for policymakers and businesses. In a pessimistic outlook, tariffs could cost companies as much as USD 1.2 trillion, with supply chain costs rising sharply. This slowdown could impact global tourism, trade flows, and investment confidence, leaving travel operators and hospitality markets on edge.<\/p>\n

U.S. Faces Fragile Outlook and Higher Inflation<\/p>\n

The U.S. economy is feeling the heat from shifting trade policies. GDP growth is expected to slow to 1.6% in 2025, down from earlier forecasts of 2.1%. Inflation is projected to hit 3%, higher than the previous estimate of 2.3%. Under Euromonitor\u2019s \u201cTotal Trump\u201d scenario, inflation could surge to 5.3% due to supply chain disruptions and costlier imports. Analysts warn that this trajectory could tip the U.S. into a policy-driven recession by 2026. For the travel sector, this could mean lower domestic spending, fewer outbound trips, and reduced international arrivals.<\/p>\n

Tariffs and Climate Events Push Supply Chains to the Edge<\/p>\n

Ongoing conflicts and extreme weather are shaking global supply chains. Manufacturers are now focusing on near-shoring and creating more resilient production models. Euromonitor\u2019s Macro Model warns that a 20\u201340% rise in commodity prices could add a full percentage point to global inflation in 2025. For tourism and hospitality, these disruptions could lead to higher food, fuel, and construction costs. Airlines, cruise lines, and hotels may face slimmer margins as operational expenses climb, even if demand remains steady in some regions.<\/p>\n

Protectionism Adds New Risks for Global Trade<\/p>\n

The return of protectionist U.S. policies under Trump has reignited fears of a global trade war. The \u201cLiberation Day\u201d scenario outlines a worst-case where tariffs cost U.S. importers over USD 1 trillion, while manufacturing component costs rise by 20%. Such shocks could weaken cross-border tourism by making travel-related goods and services more expensive. For destinations reliant on imported hospitality products, from wine to building materials, these added costs could erode competitiveness.<\/p>\n

Asia Pacific Offers Growth Opportunities Despite Volatility<\/p>\n

While global markets are slowing, Southeast Asia and India remain bright spots. India\u2019s economy is projected to grow at around 6.5% annually over the next three years, supported by a large domestic market and rising middle class. For global tourism, these regions offer opportunities for expansion. Major FMCG brands like Unilever and Nestl\u00e9 have already ramped up investments in India, betting on its resilience. This same growth potential extends to the travel sector, with more outbound tourists and increasing interest from international hotel chains.<\/p>\n

Businesses Urged to Build Agility and Resilience<\/p>\n

Lan Ha of Euromonitor <\/a>emphasises that uncertainty is now the \u201cnew normal\u201d for global markets. Businesses must adapt through agile strategies, robust scenario planning, and diversified supply chains. In tourism, this could mean adjusting pricing models, sourcing more locally, and expanding into high-growth markets like India and Southeast Asia. Innovation, backed by market data, will be key to weathering both short-term volatility and long-term structural shifts in the global economy.<\/p>\n

Outlook for 2025 \u2013 Travel Sector Must Brace for Change<\/p>\n

With global growth slowing to 2.9%, the travel industry faces both challenges and openings. High tariffs, costlier imports, and climate-related disruptions will test the resilience of operators. Yet, opportunities in emerging economies could offset some of the pressure. Those who can adapt quickly, diversify markets, and invest in innovation will be best positioned to thrive in this uncertain environment. For now, the sector must balance caution with ambition as 2025 unfolds.<\/p>\n

Source: Hotel News Resource<\/p>\n

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