Disruptions in the Strait of Hormuz have emerged as a major threat to global trade, putting international supply chains and economic stability under increasing pressure.
Despite geopolitical tensions, global trade in goods has recorded stronger-than-expected growth of 4.6% this year. Around 72% of global commerce continues to operate under World Trade Organization rules.
The annual growth forecast for global goods trade stands at 1.9%, while first-quarter growth reached 3.2%, exceeding earlier expectations.
A significant share of the recent momentum has been linked to rapidly expanding trade in artificial intelligence technologies. Low- and zero-tariff arrangements covering around $3 trillion in semiconductor and chip shipments have also supported this growth.
However, the sustainability of the trend remains uncertain, with the economic gains from expanding technology trade concentrated largely in North America and East Asia.
National reserves have so far helped shield markets from the initial impact of disruptions in the Strait of Hormuz. A prolonged disruption in the strategic waterway could, however, increase agricultural and other commodity costs.
Previous estimates indicate that crude oil prices reaching $90 per barrel could reduce global trade growth by around 0.5 percentage points. Oil prices have since moved above that level.
Shipping companies have maintained trade flows by rerouting vessels through alternative maritime routes, but longer journeys have increased transportation costs and added pressure to global supply chains.
Governments are also preparing contingency plans to protect their economies from potential disruptions at major global trade chokepoints.
The combination of supply chain instability and rapid technological changes has intensified discussions over modernising international trade rules. Institutional reforms are being considered to improve the global trading framework and expand economic opportunities for developing countries.
Concerns have also been raised that a breakdown in multilateral cooperation and failure to update trade regulations could significantly reduce potential global economic growth by 2050.
