The Gulf's blueprint for resilient trade in a volatile world

Trade diversification aside, CEPAs have opened new export growth avenues

- AREEJ AFTAB SIDDIQUI, DR EESA AL BASTAKI, AND ARIJ LAHMAR

Trade protectionism, once perceived as a short-term pivot in US foreign policy, has increasingly become a structural feature of global economic dynamics.

Catalysed by the Trump administration's introduction of sweeping tariffs in 2018 and reignited by the recent 2025 tariff escalation between the United States and China, the trend has left a lasting imprint on global trade architecture. For Gulf Cooperation Council (GCC) countries, Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the UAE, the effects of this shift, while indirect, are deeply consequential.

The initial phase of US tariffs under President Donald Trump included Section 232 duties on steel and aluminium, followed by Section 301 tariffs targeting Chinese imports. These actions triggered a domino effect across global markets, leading to retaliatory tariffs, disruptions in supply chains, and a re-evaluation of trade flows. Though GCC states were not direct targets, their role as export-oriented economies and vital logistics hubs placed them squarely within the impact zone. The newly announced 145 per cent US tariff on Chinese goods, and China's reciprocal 125 per cent tariff, have only intensified the need for strategic policy responses across the Gulf.

Diversifying client bases