Global M&A Hits 20-Year Low Amid Trump's Tariff Surge

In April 2025, global mergers and acquisitions (M&A) activity plummeted to its lowest level in two decades, a downturn closely following U.S. President Donald Trump's declaration of a global trade war on April 2, termed "Liberation Day."

Data from Dealogic indicates that only 555 M&A contracts were signed in the U.S. during April, marking the fewest since May 2009. Globally, deal values fell to $243 billion, representing a 54% decrease from March and 20% below the historical monthly average. (ft.com)

On April 2, 2025, President Trump announced a baseline 10% tariff on all imports, with higher rates for key trading partners: 34% on China, 20% on the European Union, 26% on India, and 46% on Vietnam. These measures elevated U.S. trade duties to levels last seen during the Great Depression. (axios.com)

The administration's unpredictable tariff policies and threats against the Federal Reserve have heightened market volatility. Bankers advised clients to postpone deals and initial public offerings due to policy uncertainties. (ft.com)

Despite the overall decline, technology deals remained relatively active. Their reliance on intangible assets made them less susceptible to tariffs. Notable transactions in April included Global Payments' $24.25 billion acquisition and Boeing's $10.6 billion sale of Jeppesen. (ft.com)

Analysts highlighted that manufacturers and export-dependent companies were particularly vulnerable. The need for increased caution in deal-making under the current economic climate was emphasized. (ft.com)

President Trump acknowledged that his aggressive tariff policy could lead to more expensive and fewer consumer goods in the U.S., stating hypothetically that children might have "two dolls instead of 30." This remark drew criticism and comparisons to historical figures perceived as out of touch with the populace. (apnews.com)

The stock market initially plummeted following the tariff announcements but rebounded within weeks. The rebound began after Trump declared a 90-day pause on most tariffs—except those targeting China—causing a major one-day market surge. Despite ongoing uncertainty and volatility, markets were buoyed by signs of de-escalation in trade tensions, easing of tariffs on key goods, and strong corporate earnings reports. (axios.com)

The current situation draws parallels to past trade conflicts, notably the Smoot-Hawley Tariff Act of 1930, which imposed high tariffs and is often cited as exacerbating the Great Depression. The recent tariffs have raised concerns about similar economic downturns. (axios.com)

The decline in M&A activity to levels not seen since May 2009 reflects the significant impact of policy decisions on corporate strategies and market confidence. (ft.com)

The significant decline in global M&A activity underscores the profound impact of trade policies on corporate strategies and market confidence. As the administration's tariff measures continue to unfold, businesses and investors remain cautious, navigating an environment fraught with uncertainty and potential economic repercussions.