Economic Collapse

Global trade tensions, supply chain disruptions, and skyrocketing costs are some of the unprecedented effects caused by U.S. president Donald Trump’s second term aggressive tariff policies. Tariff policies' impact goes beyond being just hypothetical, with real-time predictions and forecasts that more severe effects could follow; the global GDP is expected to slowly grow by only 2.2% in 2025, while the United Nations Conference on Trade and Development (UNCTAD) has warned of a possible global recession, given that growth slips below 2.5%. Not only the UNCTAD but also the International Monetary Fund (IMF) has downgraded its outlook for the global economy to 2.8% in 2025 and made a significant revision for the U.S. economy lowering its 2025 growth projection to 1.8% in April from 2.7% in January. Adding to these concerns, the World Trade Organization has already highlighted a sharp deterioration in global trade prospects, with world merchandise trade now expected to decline by 0.2% in 2025, nearly three percentage points lower than previous forecasts.   The current instabilities go beyond the economic aspect; they also affect the U.S.’s international alliances and add additional burdens to households, many of whom are delaying major life decisions. A pressing question amid recession fears arises: What are the impacts on a global scale in the event of a U.S. economic collapse? Given the leading position the U.S. plays as the world’s largest economy and the leading issuer of primary reserve currency, such a downturn would trigger a financial disaster of unparalleled magnitude. Essentially, if the U.S.’s economy falls, the world’s economy falls with it.