The global economy is projected to grow by as much as 2.3% in 2025, driven by multiple factors, including ongoing trade tensions and growing uncertainty surrounding U.S. tariff policy, the United Nations Conference on Trade and Development (UNCTAD) warned .

In its Trade and Development Outlook 2025 – Under Pressure: Uncertainty Reshaping the Global Economic Outlook report , the UN agency noted that the global economy is on a recessionary trajectory .

The document indicated that growing threats, financial volatility, and increased uncertainty could continue to weaken the global outlook.

In its report, it detailed that U.S.  Gross Domestic Product (GDP) growth could slow by 1.8 points and fall to just 1% this year.

“Optimism at the beginning of 2025 about a potential dynamic expansion of the US economy, driven by corporate tax cuts, deregulation, and monetary easing, is now tempered by abrupt changes in trade and migration policies,” UNCTAD noted.

Meanwhile, in North America, the agency forecasts a slowdown of eight-tenths of a percentage point in Canadian economic growth, from 1.5% in 2024 to 0.7% in 2025. Meanwhile,  China’s GDP could grow 4.4% this year.

 The European Union ‘s economy is expected to grow by 1% in 2025, which would be a tenth of a percent more than last year.

UNCTAD emphasized that the slowdown will affect all countries, although developing and vulnerable economies could be more severely impacted.

“Many low-income countries are facing a ‘perfect storm’ of adverse external financial conditions, unsustainable debt, and weakening domestic growth,” the organization noted.

In Mexico’s case, the report indicated that export restrictions could affect productive growth. Regarding South-South trade, it specified that it represents approximately one-third of the global total.

“The potential of South-South economic integration offers opportunities for many developing countries,” the report stated, noting that tariffs are not the only reason for the global economic slowdown, as other factors also play a role, such as a lack of public policies.

Due to protectionist trade policies and the confrontation between China and the United States, cross-border production chains and trade flows could be disrupted, UNCTAD warned.

The report noted that the economic outlook for 2025 is not very encouraging, due to levels of political uncertainty that even exceed those experienced in 2020, during the onset of the COVID-19 pandemic.

Faced with these challenges, the United Nations agency called for the reactivation of dialogue and negotiation, along with greater coordination of regional and global policies, leveraging existing economic and trade ties.

On  April 2 , US President  Donald Trump announced a series of reciprocal tariffs that would be applied to products entering the United States from various countries around the world. However, on  April 9 , the US president paused said tariffs for  90 days , except for China, a country with which the northern neighbor is engaged in a tariff dispute.

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Trump has consistently threatened to impose additional tariffs on products from other countries entering the United States, and although the US president has acknowledged that this measure will affect consumers in his northern neighbor, he continues to pursue his plan. “It’s possible that in the short term, it will hurt us a little bit,” Trump said last February.

The threat of imposing tariffs has been used by the US president to boost his base and as a bargaining chip for issues beyond the economic, as he has done with Mexico, thereby exerting pressure to curb illegal migration and fentanyl trafficking into the United States.

Since taking office last January, Trump has been aggressive with his tariff threats, creating uncertainty in various global markets and causing investors to act cautiously.

Trump’s idea with reciprocal tariffs, he says, is to protect American products and boost domestic manufacturing by charging the same tariffs that other countries impose on American exports. “We’ll charge them what they charge us, it’s fair,” he said.

“We’re going to be very lenient compared to what other countries are doing,” Trump has said repeatedly, emphasizing that the tariffs he will impose will be lower than those some nations apply to American goods.

“The numbers will be lower than what we’ve been charged, and in some cases, perhaps substantially lower. In some ways, perhaps, we have an obligation to the world, so we’ll be very kind, relatively speaking, we’ll be very generous,” the US president said.

On April 1,  White House press secretary  Karoline Leavitt said the tariffs would take effect “immediately” after the official announcement. “The president is fine-tuning the tariff package to ensure it’s beneficial to American workers,” she noted.

The US president has indicated that the initial 25% rate could be increased over time, giving foreign companies the opportunity to relocate their operations to the United States and avoid the taxes.

The tariff measure will affect various products, including vehicles imported into the United States, whose 25% tariffs were already announced by Trump on March 26.

Despite the fact that the President of the United States has indicated that he does not want vehicles manufactured in Mexico and Canada, the United States remains the main buyer of cars manufactured in the country.

According to figures from the  Administrative Registry of the Light Vehicle Automotive Industry (RAIAVL)  of the  National Institute of Statistics and Geography (Inegi) , in 2024 Mexico exported  three million 479 thousand 086 vehicles , and two million 771 thousand 287 units were sent to the United States alone  , that is, 80 percent .

According to US media, White House advisers have drawn up a proposal to impose tariffs of around 20% on most US imports. However, details on this issue will have to wait for Trump’s announcement this Wednesday.

Fitch Ratings has   predicted a  technical recession for Mexico  as a result of  Trump’s tariffs , and has also lowered its growth projection for the country in 2025.

“We anticipate a recession in Mexico, where we have cut our 2025 forecast by 1.1 percentage points to 0%,” the institution reported in its Global Economic Outlook – March 2025 report .

Meanwhile, in its Economic Outlook report, the Organization for Economic Cooperation and Development (OECD) estimated that the tariff measure would cause  Mexico’s Gross Domestic Product (GDP) to contract by 1.3% in 2025 .

He also warned that if the United States’ protectionist policy continues, this contraction, projected at  0.6%  by 2026, would cause an economic recession for Mexico, the only country with negative figures in this regard.

Meanwhile, Mexican President Claudia Sheinbaum has stated that she does not believe in “an eye for an eye, a tooth for a tooth,” as this always leads to a bad situation.

“We don’t believe in ‘an eye for an eye, a tooth for a tooth,’ because that always leads to a bad situation. Of course, measures are taken because measures are taken by the other side, but dialogue must continue. It’s not a matter of ‘you put me in, I’ll put you in,’ but rather what is best for Mexico and how to address this situation,” Sheinbaum emphasized. She will wait until Trump’s announcement to announce the measures her administration will take in this case, although she expects preferential trade treatment under the United States-Mexico-Canada Agreement (USMCA) .

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Fitch Ratings has predicted a technical recession for Mexico as a result of the tariffs imposed  by US President Donald Trump , and has also lowered its growth projection for the country in 2025.

“We anticipate a recession in Mexico, where we have cut our 2025 forecast by 1.1 percentage points to 0 percent,” the institution reported in its World Economic Outlook – March 2025 report.

The rating agency also lowered its growth forecast for 2026 to 0.8% , a nine percentage point decrease from its previous estimate.

In his analysis, he noted that the new US administration has launched a global trade war that will reduce growth in the US and globally, boost inflation in the US, and delay rate cuts by the Federal Reserve (Fed).

“We have cut both our 2025 US growth forecast to 1.7% from 2.1% in the December 2024 World Economic Outlook and our 2026 forecast to 1.7% to 1.5%. These rates are well below trend and below the annual growth of nearly 3% in 2023 and 2024,” he warned.

Fitch Ratings estimates that the impact will be felt globally, forecasting that global growth will slow to 2.3% in 2025. It also indicated that growth will remain weak at 2.2% in 2026.

“This is a downward revision of 0.3 percentage points and reflects widespread declines in developed and emerging economies. Growth will remain weak, at 2.2% in 2026,” he stated.

He noted that the U.S. effective tariff rate (ETR) has already risen to 8.5% from 2.3% in 2024 and warned that further increases are likely.

“Our latest economic forecasts assume a 15% ETR will be imposed on Europe, Canada, Mexico, and other countries in 2025, and 35% on China. This will bring the U.S. ETR to 18% this year before moderating to 16% next year as Canada and Mexico’s ETRs fall to 10%. This would be the highest rate in 90 years,” he stressed.

He noted that there is great uncertainty about how far the United States will go and noted that there are risks of a “major tariff shock,” even due to an escalation of the global trade war.

“Tariff increases will result in higher consumer prices in the United States, reduce real wages, and increase business costs, while increased political uncertainty will hurt business investment. Retaliation will hurt U.S. exporters. Global export-oriented manufacturers in East Asia and Europe will also be affected,” he noted.

Fitch Ratings’ forecasts are in line with those of the  Organization for Economic Cooperation and Development (OECD) , which estimated that the 25% tariff levied on various Mexican products that  Donald Trump is seeking to impose , and which was suspended for goods covered by the  United States-Mexico-Canada Agreement (USMCA)  until April 2, would cause the   country’s  Gross Domestic Product (GDP) to contract by 1.3%  in 2025.

In its OECD Economic Outlook, March 2025 Interim Report , the organization noted that if the United States’ tariff policy is maintained, this contraction, projected at 0.6% for 2026, would cause an economic recession for Mexico, being the only country with negative figures in this regard.

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