Trade Reckoning

June 3, 2025--Stalled trade integration and rising tariffs are testing global economic resilience
For decades, world trade expanded rapidly as countries lowered tariffs and embraced globalization. Tariff rates fell dramatically worldwide, converging toward the low levels of the United States.

But progress has stalled. Since the 2008 financial crisis, trade openness has stopped rising and global imports have leveled off at about a third of GDP. Trade tensions have escalated this year, and some major economies are reversing course, with US tariffs in April reaching the highest level in over a century. Other countries have responded.

This new trade landscape has serious consequences for the global economy. Many smaller, trade-reliant countries are more exposed to these shifts in trade patterns. Trade policy uncertainty is off the charts, making it harder for businesses everywhere to plan ahead.

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