If inflation is the fuel for recession, the tariffs imposed by U.S. President Donald Trump are the matches that will ignite it, Croatian economic analyst Petar Vuskovic said in an interview with the local N1 Television on Tuesday.

"It is not a question of whether the economic Armageddon will hit us because it has already hit us. We can see it from the collapse of the stock markets. Investors are scared; it is not known what will happen next. This is a situation that definitely marks a new period, which is the period of recession," Vuskovic was quoted as saying.

On Monday, European stocks sank for a fourth straight session, and the S&P 500 extended its losses for a third day, fuelled by concerns over U.S. tariffs.

Companies are already laying off workers, and the situation is "practically worse" than during the COVID-19 pandemic. "All stakeholders are at risk, from state budget revenues, investors, company owners, employees, he said. "Simply put, the economic situation is bad."

As to Croatia, Vuskovic said the value of Croatian exports to the United States is 587 million euros ($642 million) a year, less than 10 percent of Europe's total exports to the U.S. market. However, for Croatian citizens, tariffs will bring further price increases for imported goods such as computer components.

"Production costs will increase through the growth of raw material imports, and exports will be more expensive, and the biggest losers will be companies that export wines, oils, medicines, sardines, pharmaceutical products, machinery, wood products," he said, adding that, "For the Croatian economy, customs duties could also mean a drop in budget revenues, especially if the exporter segment is severely affected."

Amid widespread opposition, Trump signed an executive order last week on the so-called reciprocal tariffs, imposing a 10-percent "minimum baseline tariff" on all imports and higher rates on certain trading partners.

"I do not think that this protectionist economic policy is good. Trump will protect the richest with tariffs, and will make his citizens poorer," Vuskovic noted.