ifo Institute: Trump’s Tariff Policy Would Harm the US Economy and Global Trade

A recent analysis by the ifo Institute warns that the tariff policies proposed by US President Donald Trump could have significant negative effects on the US economy and global trade. According to the study, Trump’s plan to impose a 10% tariff on all imports and a 60% tariff on goods from China would lead to higher consumer prices, reduced exports, and a decline in economic growth in the United States.

The ifo Institute estimates that these tariffs could cost the US economy up to $100 billion annually, with the burden falling mainly on American consumers and businesses. The report also highlights the risk of retaliatory measures from trading partners, which could further disrupt international supply chains.

For the toy industry, these developments are particularly relevant. Many toys sold in the US are manufactured in China and other Asian countries. Higher tariffs would likely lead to increased costs for toy manufacturers and importers, potentially resulting in higher retail prices and reduced product variety for consumers. The global toy supply chain could face additional challenges, including delays and increased complexity in sourcing and logistics.

Industry experts urge companies to closely monitor trade policy developments and consider diversifying their supply chains to mitigate potential risks. The ifo Institute’s findings underscore the importance of stable and predictable trade relations for the continued growth and innovation of the toy sector.

Source: ifo Institute https://www.ifo.de/en/press-release/2025-06-02/trumps-tariff-policy-damaging-us-economy