OECD Cuts Global Growth Forecast Amid Rising Trade Tensions

The Organisation for Economic Co-operation and Development (OECD) has revised its global economic growth forecasts downward, attributing the slowdown to escalating trade tensions and rising protectionism. In its latest report released on June 3, 2025, the OECD projects global GDP growth to decelerate to 2.9% in both 2025 and 2026, marking the weakest pace since the COVID-19 pandemic.

The OECD's report highlights that the average U.S. tariff rate has surged from 2.5% to over 15%, a level not seen since World War II. This significant increase in trade barriers is cited as a primary factor contributing to the economic slowdown. The OECD warns that persistent protectionist policies could have substantial global repercussions, emphasizing the need for reducing trade barriers and fostering international cooperation to restore investment confidence and prevent further economic deterioration.

The United States is expected to experience a notable decline in economic growth, with projections indicating a decrease from 2.8% in 2024 to 1.6% in 2025 and 1.5% in 2026. Inflation is anticipated to rise to nearly 4%, potentially delaying Federal Reserve interest rate cuts. The OECD attributes these trends to the adverse effects of increased trade barriers initiated under President Donald Trump's administration.

China's growth is projected to slow to 4.7% in 2025, influenced by structural deceleration and ongoing trade disputes. The Eurozone faces stagnation, with Germany's economy particularly impacted. Despite these challenges, Spain is projected to maintain relatively solid growth of 2.4% in 2025, driven by private consumption and tourism.

The OECD emphasizes the need for reducing trade barriers and fostering international cooperation to restore investment confidence and prevent further economic deterioration. The organization warns that persistent protectionist policies could have significant global repercussions.

The OECD's latest economic outlook underscores the significant impact of escalating trade tensions on global growth projections. The organization emphasizes the need for reducing trade barriers and fostering international cooperation to restore investment confidence and prevent further economic deterioration. Persistent protectionist policies could have significant global repercussions, affecting consumers, employment, and overall economic stability.

Tags: #OECD, #trade, #economy, #GDP, #protectionism

Sources

  1. Trump trade war to drag global growth to post-Covid low, OECD warns
  2. OECD lowers global outlook as Trump trade war hits US growth
  3. La OCDE rebaja el crecimiento de la economía global y de España por el auge del proteccionismo
  4. US growth likely to slow to 1.6% this year, hobbled by Trump's trade wars, OECD says

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