The global economy faces heightened risks as the Middle East conflict and a looming U.S.-led tariff war unfold simultaneously. President Trump’s proposed tariffs, especially targeting China, could severely disrupt trade, while rising tensions between Israel and Iran may drive energy prices up. With global growth already slowing, these twin shocks amplify recession fears. Experts warn that even minor disruptions could now trigger a downturn, echoing past crises like the 1990 Gulf War. The IMF forecasts global growth at a sluggish 2.8% in 2025.
The global economy, already struggling with slow growth, now faces heightened risk from two simultaneous shocks: the outbreak of a new war in the Middle East and a destructive tariff war. Despite some prospects of a temporary ceasefire, the likelihood of a global recession has significantly increased.
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