As the world approaches 2025, macroeconomic trends are emerging that could significantly reshape the global economy. With Donald Trump preparing for a potential second term, increased tariffs and tax hikes are anticipated, which will likely impact global markets. Proposals include 25% tariffs on goods from Mexico and Canada, and a staggering 60% on Chinese imports, with discussions of potential 100% tariffs on BRIC nations [a34fc8bb].
The global GDP growth is projected at 3.3% in 2025, while the UK economy is expected to grow by 2%, driven by reduced inflation. However, Labour's budget plans include an increase in capital gains tax and a rise in employer national insurance contributions to 15%, which could affect business operations [a34fc8bb].
Geopolitical risks remain a significant threat to businesses, with conflicts at their highest since World War II, creating an uncertain environment for trade and investment. This backdrop of geopolitical tension is compounded by the anticipated changes in U.S. economic policy, which could further complicate international trade relations [a34fc8bb].
In the U.S., the economy is navigating through a landscape of strategic planning scenarios, with GDP growth forecasts ranging from 0.8% to 3% as the Trump administration's policies take shape. Inflation rates are also a concern, with projections indicating they could exceed 2.5% [19532716].
Curtis Dubay, chief economist for the U.S. Chamber of Commerce, noted that while the U.S. economy grew nearly 3% last year, the proposed tax and tariff changes could increase long-run GDP by 0.8% but also raise the 10-year budget deficit by an estimated $2.5 trillion to $3.0 trillion [e13ee3c6].
Manufacturers are particularly anxious about their ability to adapt to these changes, with a survey revealing that 78% are concerned about their agility in responding to market shifts. Four potential economic scenarios have been outlined for manufacturers, ranging from a soft landing with stable growth to stagflation, characterized by high inflation and low growth [19532716].
The M&A market is expected to rebound in 2025, with recent UK deals totaling £5.3 billion, and the integration of AI is anticipated to reshape M&A processes, enhancing efficiency and decision-making [a34fc8bb].
Overall, as the U.S. and global economies prepare for 2025, the interplay of trade policies, geopolitical risks, and strategic planning will be crucial in determining economic outcomes. Businesses must remain agile and prepared to navigate this complex landscape [19532716].