President Donald Trump’s sweeping new tariff plan could propel the U.S. average tariff rate from 2.5% to a staggering 22%, marking the highest level in more than a century, according to a dire warning from global credit rating agency Fitch Ratings.
In a statement released on Wednesday, April 2, 2025, Olu Sonola, Head of U.S. Economic Research at Fitch, described the policy shift as a “game changer” with the potential to send multiple countries into recession and destabilize global trade.
The projected 22% tariff rate would surpass the levels imposed by the 1930 Smoot-Hawley Tariff Act, a protectionist measure widely blamed for deepening the Great Depression through retaliatory trade wars.
“This is not just a seismic shift for the U.S. economy, it’s a threat to global economic stability,” Sonola warned, citing the likelihood of widespread economic contraction if major trading partners retaliate.
Trump’s aggressive tariff strategy—announced under the banner of revitalizing American manufacturing—has sparked intense debate among economists, investors, and foreign governments. Critics argue it could lead to inflation, disrupted supply chains, and increased geopolitical tensions, while supporters believe it may reduce trade deficits and revive domestic industries.
With the global economy still recovering from pandemic-era shocks and inflationary pressures, Fitch’s forecast adds urgency to concerns about a potential global downturn triggered by trade protectionism.
“You can throw most forecasts out the door if this tariff rate stays on for an extended period of time,” the Fitch economist said.
Earlier on Wednesday, April 2, 2025, Trump announced that exports from Nigeria to the US will attract a 14% tariff compared to the 27% that the US government claims it receives from Nigeria.
This is even as the US President slammed a baseline 10% tariff on all U.S. imports, alongside sharper, country-specific reciprocal tariffs aimed at nations that impose steeper duties on American goods.