At the IMF and World Bank Spring Meetings in April 2025, LSEG and Eurasia Group convened a closed-door roundtable to examine the reshaping of global trade relationships.
LSEG recently outlined the six key themes to come from the roundtable. The discussion, held under the Chatham House Rule, explored the rising convergence of security and economic policy, the end of traditional globalisation models, and the increasing value of institutional credibility in a world of fragmented alliances and eroding trust.
Participants agreed: the disruption to global trade isn’t a short-term shock, but a lasting transformation requiring a fundamental shift in how governments and companies navigate risk, LSEG explained.
A central theme was the ongoing shift in US trade policy. The current administration is pushing to reinvigorate domestic manufacturing and reduce dependence on foreign suppliers, particularly in sensitive sectors like semiconductors and pharmaceuticals. While some questioned whether this import-substitution approach would succeed—given its chequered history—others argued that the unique scale and appeal of the US market could produce different results this time.
However, policy unpredictability is beginning to take a toll. As trade rules and industrial policies remain in flux, many businesses are adopting a wait-and-see approach to long-term investment. In contrast, private equity firms and other opportunistic investors are actively seizing the moment, seeing undervalued assets and shifting dynamics as a path to growth.
In this climate, companies are relying less on forecasting and more on scenario-based decision-making. The days of treating geopolitical risk as a background issue are over; businesses are embedding political risk analytics directly into core strategy development, particularly as developed economies face pressures that resemble those of emerging markets, it said.
The discussion also addressed the diminishing trust in the US as a global partner. Despite longstanding alliances, countries such as Canada, the EU, and Australia are facing unexpected tariffs, leading to scepticism about the durability of US commitments. Some global players are beginning to question the long-term viability of the US dollar as the world’s reserve currency, even though no clear alternative has emerged.
The ripple effects of US trade policy are being felt globally. German automakers, for example, are vulnerable to redirected Chinese exports, while countries across Asia are recalibrating their positions. Japan and South Korea are aligning closely with the US, whereas ASEAN nations are maintaining a delicate balancing act between Washington and Beijing. Canada is actively working to diversify its trade flows beyond the US, building infrastructure and expanding LNG exports to Europe and Asia. Meanwhile, India is leveraging its non-aligned stance to draw supply chains and investment, presenting itself as a neutral yet strategic partner in a multipolar world.
At the macro level, governments are increasingly intervening in markets, promoting domestic champions and resilience as strategic priorities. Future trade agreements are expected to integrate economic security, marking a departure from purely market-based trade frameworks.
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