{"id":32780,"date":"2025-06-29T04:21:20","date_gmt":"2025-06-29T04:21:20","guid":{"rendered":"https:\/\/financialrush.com\/?p=32780"},"modified":"2025-06-29T04:21:20","modified_gmt":"2025-06-29T04:21:20","slug":"trumps-tariff-war-and-aid-cuts-threaten-poorest-nations-recovery","status":"publish","type":"post","link":"https:\/\/financialrush.com\/?p=32780","title":{"rendered":"Trump\u2019s tariff war and aid cuts threaten poorest nations\u2019 recovery"},"content":{"rendered":"<p> \n<\/p>\n<div>\n<p>Unlock the White House Watch newsletter for free<\/p>\n<p class=\"article__content-sign-up-topic-description o3-type-body-base\">Your guide to what Trump\u2019s second term means for Washington, business and the world<\/p>\n<p><iframe class=\"article__content-sign-up-iframe close\" scrolling=\"no\" id=\"signUpIframe\" data-prev-url=\"\/register\/in-article-sign-up?ft-content-uuid=2ce2c21a-8289-4408-aeba-1dcfd54e6ef5&amp;newsletter-id=65b8fec772badb00166eafc6\"><\/iframe><\/div>\n<div id=\"article-body\">\n<p>The world\u2019s poorest countries are being hit by a \u201cdouble whammy\u201d of Donald Trump\u2019s tariffs and deep cuts to international aid budgets, undermining global efforts to eradicate poverty and tackle climate change, senior trade experts have warned.\u00a0<\/p>\n<p>The toxic combination of \u201ca trade war and an aid war\u201d is squeezing smaller developing countries that are still recovering from the Covid-19 pandemic and the rising costs of servicing international debt.<\/p>\n<p>\u201cThis is a perfect storm because when aid has been cut in the past, trade has generally been sustainable and predictable, there has not been this double whammy,\u201d said Pamela Coke-Hamilton, executive director of the International Trade Centre in Geneva, a joint agency of the World Trade Organization and the UN.<\/p>\n<p>Trump\u2019s threat of 40 to 50 per cent tariffs on countries such as Lesotho, Madagascar and Mauritius risked severely damaging those economies, she said.<\/p>\n<p>Coke-Hamilton, a former Jamaican diplomat, was speaking to the Financial Times ahead of a UN conference opening in Seville, Spain on Monday designed to renew global support for the 2030 Sustainable Development Goals. <\/p>\n<p>It is the first such conference in a decade but the US formally withdrew from the summit earlier this month. The Trump administration stated in March that it \u201crejects and denounces\u201d the goals, which were agreed in 2015 and aim to eradicate poverty and promote sustainable development by the end of the decade.<\/p>\n<p>The Trump administration has also announced massive cuts to its aid budgets, with USAID expected to fall from $60bn in 2024 to less than $30bn in 2026, <a href=\"https:\/\/www.cgdev.org\/blog\/charting-fallout-aid-cuts\" data-trackable=\"link\">according to<\/a> calculations by the Center for Global Development, a Washington-based think-tank. <\/p>\n<p>Other countries, including France, Germany and the UK, are also cutting aid spending.<\/p>\n<div class=\"n-content-layout\" data-component=\"flourish\" data-component-id=\"23952534\" data-component-type=\"flourish-in-article\">\n<figure class=\"n-content-picture n-content-layout__container\"><a href=\"#23952534\"><picture data-asset-type=\"flourish\" data-flourish-id=\"23952534\" data-flourish-type=\"visualisation\">\n<div id=\"23952534\" class=\"cp-message o-message o-message--inform o-message--notice\" data-o-component=\"o-message\">\n<div class=\"o-message__container\">\n<div class=\"o-message__content\">\n<p class=\"o-message__content-main\">Some content could not load. Check your internet connection or browser settings.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<p><\/picture><\/a><\/figure>\n<\/div>\n<p>Charles Kenny, senior fellow at CGD, said the combination of tumbling aid contributions and uncertainty about the world economy would make it harder to attract international investment into developing countries.\u00a0<\/p>\n<p>\u201cIf this is not the actual death of the sustainable development goals, it is definitely taking us further away from them,\u201d he added.<\/p>\n<p>Aid industry analysts warned that the <a href=\"https:\/\/financing.desa.un.org\/finaldraftreleased\" data-trackable=\"link\">communiqu\u00e9<\/a> to be agreed at the Seville conference had suffered several last minute dilutions in key areas, including commitments to phase out fossil fuels and a UN process to create an inter-governmental mechanism for managing developing country debt.<\/p>\n<p>Bodo Ellmers, director of sustainability at Global Policy Forum Europe, a German think-tank, said the summit risked turning into a missed opportunity to steer the global development agenda.<\/p>\n<p>\u201cIn developing countries the share of public revenues going to debt service has increased massively in recent years, often with expensive loans from private developers. The UK or Germany borrows at 3 to 4 per cent, developing countries at 6 to 8 per cent,\u201d he said.<\/p>\n<p>Joseph Stiglitz, professor at Columbia University and co-chair of the <a href=\"https:\/\/ipdcolumbia.org\/wp-content\/uploads\/2025\/06\/Jubilee-report_veryfinal.pdf\" data-trackable=\"link\">Jubilee Report<\/a> commissioned by the late Pope Francis, said the interest rates private sector lenders were charging developing countries were \u201chigher than can be justified by the risk\u201d.<\/p>\n<p>Many countries were unable to properly fund essential public services because of their high debt burdens, he said. The Jubilee Report calculates that 750mn Africans, or roughly 57 per cent of the continent\u2019s population, live in countries that were spending more on external debt service than on either health or education. <\/p>\n<p>The International Chamber of Commerce, which is present in 170 countries around the world, will propose reforms at Monday\u2019s conference aimed at addressing the higher barriers for lending to projects in developing countries.<\/p>\n<p>When issuing credit for projects in lower-income countries, lending institutions typically need to hold between four and seven times the amount in collateral under the Basel III financial stability requirements.<\/p>\n<p>The ICC will argue at the conference that \u201ctargeted clarifications\u201d to the Basel framework could unlock significant volumes of private investment for developing countries that represent 25 per cent of global GDP.<\/p>\n<p>\u201cThe development assistance-led model is diminished, if not broken. The question now is what will replace it? Surely it should be a private sector model that can create an environment for local pools of capital to emerge,\u201d said John Denton, secretary-general at the International Chamber of Commerce.<\/p>\n<p><em>Additional reporting by David Pilling in London. Data visualisation by Amy Borrett<\/em><\/p>\n<\/div>\n\n<br \/><a href=\"https:\/\/www.ft.com\/content\/2ce2c21a-8289-4408-aeba-1dcfd54e6ef5\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"Unlock the White House Watch newsletter for free Your guide to what Trump\u2019s second term means for Washington,&hellip;\n","protected":false},"author":6,"featured_media":32781,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[23],"tags":[],"class_list":["post-32780","post","type-post","status-publish","format-standard","has-post-thumbnail","category-us","cs-entry","cs-video-wrap"],"_links":{"self":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/32780","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=32780"}],"version-history":[{"count":0,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/posts\/32780\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=\/wp\/v2\/media\/32781"}],"wp:attachment":[{"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=32780"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=32780"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/financialrush.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=32780"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}