GCC must adapt to a world pulled apart

The US and China may have reached a tariff truce, but the global trading system is not returning to business as usual. A deeper shift is underway with governments and firms rethinking supply chains in light of geopolitical tensions, industrial policy, and lessons from recent disruptions. The world is moving from decades of broadly expanding trade liberalisation towards a more fragmented and competitive environment.

- BY J. BRADFORD JENSEN

So, what does this mean for countries in the Gulf Cooperation Council (GCC)? On the risk side, greater fragmentation could dampen global growth and energy demand. If major economies prioritise producing more at home or trading within regional blocs, the result could be slower flows of goods and services worldwide. This would weigh on GCC energy exports, with lower revenues affecting budgets and investment plans. Service sectors such as logistics, aviation, and tourism, which rely on high volumes of international movement, could also feel the impact.