LONDON, Oct. 17 — A new analysis by S&P Global warns that the latest wave of global tariffs, spearheaded by U.S. trade measures, will impose costs exceeding $1.2 trillion on businesses worldwide in 2025. The report highlights that while companies will absorb part of the impact, two-thirds of the financial burden is expected to be passed on to consumers through higher prices on goods ranging from cars to household essentials CNBC miamidaily.life.
Tariffs as “Taxes on Supply Chains”
Economists describe tariffs as “taxes on supply chains”, diverting cash to governments while compounding freight costs, logistics delays, and raw material price volatility miamidaily.life vtmarketsmy.com. The S&P Global report warns that the measures represent a systemic transfer of wealth, with ripple effects across global markets.
Political Justifications vs. Economic Reality
The White House has defended the policy, arguing that foreign exporters will ultimately bear the brunt of the tariffs and that the measures are necessary to rebalance trade and encourage domestic production CNBC. However, analysts caution that the immediate effect is a sharp rise in costs for businesses and households, with inflationary pressures likely to intensify.
Global Impact
The tariffs are expected to reshape trade flows, particularly in Asia, Africa, and Latin America, as companies seek to reroute supply chains and mitigate costs CNBC. Industries most exposed include automotive, steel, electronics, and consumer goods, where reliance on cross-border supply chains is highest.
Mounting Concerns
Critics argue that the policy risks undermining global growth at a fragile moment for the world economy. With businesses already grappling with high borrowing costs and slowing demand, the additional tariff burden could erode competitiveness and squeeze profit margins.
S&P Global concludes that while governments may benefit from short-term tariff revenues, the long-term costs to businesses and consumers far outweigh any gains.
Sources: S&P Global analysis via CNBC, Axios, MSN CNBCmiamidaily.lifevtmarketsmy.comAxiosMSN.
