Global Economy News
LAST UPDATE: June 3, 2025
OECD lowers global outlook as Trump trade war hits US growth
The OECD has revised its global economic growth forecast downward to 2.9% for both 2025 and 2026, attributing the slowdown primarily to the adverse effects of the Trump administration’s trade policies.
Insight
The OECD’s report highlights the significant impact of increased U.S. tariffs on global economic activity, with the U.S. economy projected to grow only 1.6% in 2025 and 1.5% in 2026. The organization warns that further protectionist measures could exacerbate inflation, disrupt supply chains, and unsettle financial markets. The U.S. budget deficit is also expected to rise to 8% of GDP by 2026, driven by tax cuts and slower growth. These developments underscore the interconnectedness of global economies and the far-reaching consequences of unilateral trade policies.
Chinese Firms Warn EU Procurement Curb Could Hurt Trade Ties
Chinese business groups have expressed strong opposition to the EU’s decision to restrict Chinese medical device manufacturers’ access to public procurement contracts, warning that such measures could damage trade relations.
Insight
The EU’s move, based on its International Procurement Instrument, aims to promote reciprocity in access to public procurement markets. However, Chinese firms view this as discriminatory and a potential escalation in trade tensions. The restrictions could lead to retaliatory actions from China, affecting broader economic ties between the two regions. This development reflects the growing trend of protectionism and the challenges in maintaining open and fair trade practices amid geopolitical tensions.
