A top UN trade official warned that the United States’ decision to delay ending its tariff suspension is adding significant uncertainty to the global trade environment.
Pamela Coke-Hamilton, Executive Director of the International Trade Centre (ITC), said prolonging the suspension until August 1 could undermine long-term investments. It could also destabilise commercial contracts worldwide.
NEW TARIFFS HIT DEVELOPING COUNTRIES HARDEST
The initial 90-day pause on higher tariffs offered temporary relief. But, the US still imposed a 10 per cent baseline tariff on imports. This was layered over existing duties.
Many developing countries face higher costs when exporting goods to the US. This situation strains economies already grappling with rising trade barriers and limited fiscal space.
SURGING GOLD FLOWS HIGHLIGHT VOLATILE MARKETS
Ms. Coke-Hamilton explained that the uncertainty has real-world consequences, including dramatic shifts in commodity flows.
After the US exempted gold and precious metals from the new tariffs, trade volumes surged. Gold imports into Switzerland rose by 800 per cent year-on-year in May.
LEAST DEVELOPED COUNTRIES BEAR THE BRUNT
The ITC has tracked over 150 new restrictive trade measures globally since the start of 2025.
The rising tariffs add another layer to disruptions caused by the war in Ukraine. They disproportionately impact least developed countries (LDCs). These countries often face the steepest barriers. They also have the narrowest options to respond. Lesotho, for example, now faces a 50 per cent tariff on apparel exports to the US, threatening its largest industry and thousands of jobs.
Viet Nam, despite negotiating a lower tariff, must still contend with a 20 per cent levy—double the previous baseline rate—affecting its $937 million auto trade with the US.
AID CUTS COMPOUND THE CRISIS
Adding to the pressure, Ms. Coke-Hamilton highlighted that G7 nations are set to cut development aid spending by 28 per cent next year. This reduction marks the largest drop in aid budgets in fifty years, shrinking critical support just as trade becomes more unpredictable.
“A perfect storm is brewing,” she said. She emphasised that trade restrictions could create lasting damage. Aid cuts could also harm fragile economies.
STRATEGIES FOR RESILIENCE AND STABILITY
In response, the ITC urged developing countries to take proactive steps to reduce vulnerability to external shocks. Ms. Coke-Hamilton recommended three strategic priorities: strengthening regional value chains, investing in local value addition, and supporting small business resilience to shocks.
“Stability can come from the ground up,” she said. “Although uncertainties lie ahead, developing countries can still play an active role in creating a more stable economic future.”
