'This is not a serious way to manage a nation's economy'

Experts on why tariffs have raised the risk of a recession

- RACHEL CLUN

Economic experts have told The Independent the risk of a global recession remains despite the 90-day delay in Donald Trump's aggressive tariff increases.

Trump made an abrupt U-turn on Wednesday when he announced the three-month pause to all affected countries bar China, following economic meltdown and widespread backlash.

But Pau S Pujolas, who wrote a study that was cited by the Trump administration to justify the tariff hikes, says the president’s “recklessness” means it may be too little, too late.

“Yes, the damage is done,” he said. “Global value chains are suffering with all the recklessness, uncertainty is a good friend of recession. This is not a serious way to manage an economy. Firms and households need clear, predictable policies to take the right decisions and make the economy blossom.”

Even if Trump decides not to reintroduce the high tariffs, the global economic risk remains “until either Trump stops playing the tariff game, or Congress removes the power vested on the president”, the associate professor at McMaster University in Canada added.

Economist Justin Wolfers agreed there would be lasting consequences despite the pause, as the president has shown he will say something one day and change his mind the next. “The damage there is very, very lasting and very profound, because basically, he has shown he’s completely unreliable,” he told The Independent.