Global Trade at Risk: UN Warns Developing Nations Could Suffer Most in US-China Tariff Clash

The UN warns that the US-China trade war could devastate developing nations, with global trade projected to shrink by up to 7%. Countries like Bangladesh and Sri Lanka face billions in losses, while African nations risk losing vital US market access. The UN urges urgent diplomatic resolution.

The escalating trade war between the United States and China is drawing sharp warnings from global economic bodies, with the United Nations' International Trade Centre (ITC) cautioning that the ripple effects could devastate developing nations. Pamela Coke-Hamilton, Executive Director of the ITC, said that the mutual tariffs imposed by the world’s two largest economies could lead to an 80% collapse in bilateral trade, triggering widespread economic fallout far beyond the borders of the two countries involved.

In its recent move, China has imposed a steep 145% tariff on various US goods, a response to earlier US tariff hikes. According to the ITC, the tit-for-tat measures could reduce global trade by 3-7% and shave 0.7% off global GDP. But it's the developing nations that may carry the heaviest burden, with smaller export-dependent economies facing severe economic downturns.

Bangladesh could lose up to $3.3 billion due to tariffs on textile exports, while Sri Lanka faces mounting uncertainty after US duties of 44% targeted its key exports. Other vulnerable countries include Mauritius, Madagascar, and Lesotho, many of which rely heavily on US market access through the African Growth and Opportunity Act (AGOA), which is now under review.

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Experts warn that this trade confrontation, if unchecked, could prove more damaging than foreign aid cuts, as entire sectors of economies in developing nations might be destabilized. As more than 75 countries call for renegotiation, global leaders are urging both Washington and Beijing to seek diplomatic solutions before irreversible economic damage occurs.