US Unilateral Tariffs Undermine Global Trading System, Damage Developing Countries

The United States' imposition of "reciprocal tariffs" has severely damaged the global trading system and disproportionately affected developing countries, according to Carlos M. Correa, executive director of the South Centre. The tariffs are discriminatory and exclusionary, forcing members of the World Trade Organization (WTO) to engage in unfair trade practices. Developing countries are losing export incomes, products can no longer compete, and jobs are being lost due to the high tariffs, which are creating uncertainty and damaging their economies.

Key Takeaways:

• The US has disregarded WTO rules by imposing tariffs that exceed bound levels on countries including China, Switzerland, and Indonesia.
• Developing countries are the hardest-hit by the US approach, losing export incomes, facing decreased foreign investment, and weakened local currencies.
• High tariffs reduce export competitiveness, decrease foreign investment, and weaken local currencies, making it difficult for developing countries to thrive.
• The uncertainty created by US policy is severely damaging the economies of developing countries, which urgently need a stable and predictable environment.
• The consequences of these tariffs are disrupted global supply chains and a slowing global economy, affecting living conditions worldwide.
• The real causes of the US trade deficit do not lie in other countries' unfair trade practices, but in structural issues such as declining manufacturing competitiveness and corporate tax avoidance.
• Up to 30% of the US trade deficit may be explained by companies' tax avoidance.

Statistics:

• 30% of the US trade deficit may be explained by companies' tax avoidance (Source: Carlos M. Correa, Executive Director, South Centre).
• Developing countries are losing export incomes due to high tariffs.
• Foreign investment in developing countries has decreased due to the US approach.
• Local currencies in developing countries have weakened due to the uncertainty created by US policy.

Sources:

• Xinhua (2025, October). "US unilateral tariffs undermine global trading system, damage developing countries." Xia, Xinhua News Agency.
• South Centre.