Trump's "Tariff Cloud" Looms! IMF Member States: The Global Economy Is at a "Critical Juncture"

The International Monetary Fund (IMF) member countries stated in a latest declaration that the world economy is at a "critical juncture" as trade tensions escalate.

The IMF and World Bank Group (WBG) 2025 Spring Meetings were held from April 21 to April 26 at the headquarters of the two institutions in Washington, D.C., US, with the trade war initiated by US President Trump being a key topic of the meetings.

The "Chair's Statement" of the IMF's highest advisory body, the International Monetary and Financial Committee, also "welcomed the ongoing efforts to end wars and conflicts." Compared to traditional communiqués, the "Chair's Statement" is generally considered a watered-down document, as traditional communiqués require broad consensus on wording, and none have been issued since the Russia-Ukraine conflict in 2022.

The communiqué drafted by the Chair, Saudi Arabia's Finance Minister Mohammed Al-Jadaan, stated: "The world economy is at a critical juncture... After years of trade concerns, trade tensions have suddenly intensified, exacerbating uncertainty, market volatility, and risks to economic growth and financial stability."

The statement reflects a shift in attitude toward trade disputes by its largest member, the US. Just six months ago, the same group's statement focused on a soft landing for the global economy following the shocks of the COVID-19 pandemic and the Russia-Ukraine conflict.

The statement also said that IMF member countries reaffirmed "our commitment to the institution and look forward to further discussions on how to ensure the IMF remains agile and focused."

Al-Jadaan said at a press conference following the release of the statement that the IMF provides a forum for candid discussions among countries. He said: "History tells us that the greater the challenges, the more we need to come together, hold meetings, and engage in candid dialogue. This is exactly what happened this week."

Overall, "tariffs" and "trade" were key words frequently mentioned in multiple flagship events. Representatives from Africa, Latin America, Europe, and other regions generally agreed in exchanges with journalists that under the shadow of tariffs, concerns are spreading globally, and uncertainty will drag down world economic development.

In addition, these concerns also run through several new IMF reports.

For example, the World Economic Outlook report revised down the global economic growth forecast for 2025 to 2.8%, 0.5 percentage points lower than the January forecast. The report noted that a series of US tariff measures and the resulting countermeasures have caused "significant negative shocks" to the global economy, and the resulting uncertainty has also negatively impacted economic activity and prospects.

The Global Financial Stability Report also showed that global financial risks have increased significantly due to tighter financial conditions and heightened trade and geopolitical uncertainty. The Fiscal Monitor report stated that if revenue and economic output decline more than currently projected due to rising tariffs and weak growth prospects, the global public debt situation could worsen further.