Global economy set to take a £472bn hit as Trump ramps up his trade war with China
A deepening trade war could wipe £472billion off the global economy without an urgent rethink, top economists have warned.
The increasingly vicious row between China and US president Donald Trump could wipe 0.7 percentage points off growth by 2021-22, claims the Organisation for Economic Co-operation and Development.
It said a worst-case scenario of tariffs on all US-China trade and a subsequent pause in business investment could leave the Chinese economy 1.1 per cent smaller, while the US would take a 0.8 per cent hit.
The increasingly vicious row between China and US president Donald Trump could wipe 0.7 percentage points off growth by 2021-22
It comes after Trump raised tariffs on £157billion of Chinese goods from 10 per cent to 25 per cent this month. China raised tariffs on almost £50billion of US imports.
US firms are urging the president to stop his fight.More than 170 US shoe firms such as Adidas and Puma have urged Trump to abandon plans for a further 25 per cent tariff on footwear from China.
They said: ‘The proposed additional tariff would be catastrophic for our consumers, our companies, and the American economy as a whole.’
The signatories said this would cost US consumers an extra £5.5billion a year.