IMF slams Trump’s sweeping reciprocal tariffs, says they threaten growth in already sluggish economy

The International Monetary Fund has issued a sharp warning following the United States' decision to impose sweeping new tariffs. Hours after President Donald Trump unveiled a policy mandating at least a 10% duty on nearly all imports—excluding those from USMCA-compliant nations—IMF Chief Kristalina Georgieva called the move a direct threat to global economic stability.

The Washington-based organization, which promotes monetary cooperation and growth among its 91 member nations, became the first major global body to react to the tariff announcement. Georgieva said the reciprocal tariffs “clearly represent a significant risk to the global outlook at a time of sluggish growth.”

She further cautioned, “It is important to avoid steps that could further harm the world economy. We appeal to the United States and its trading partners to work constructively to resolve trade tensions and reduce uncertainty.”

Trump’s policy introduces a 10% tariff on all imports from countries outside the USMCA. For those not in compliance with the agreement, a 25% tariff remains. Nearly 60 nations with notable trade surpluses against the US are affected.

The IMF’s concerns are also tied to its global forecast. Back in January, the institution projected global growth to hit 3.3% this year—below the 3.7% average seen since the early 2000s. The fund now plans to detail the broader implications of these tariffs in its upcoming World Economic Outlook report, which will be released during the IMF Spring Meetings in Washington later this month.

The sweeping tariff move has already rattled markets. On the day of the announcement, the S&P 500 alone lost $2.4 trillion in market value.

(With agency inputs)

Published on: Apr 04, 2025, 9:16 AM IST