The World Trade Organization predicts global trade will rise 2.6% in 2024 after a 1.2% drop in 2023. This is expected due to lower inflation and interest rates. Despite this, geopolitical tensions, particularly between the US and China, could disrupt trade. The WTO also observed increasing trade fragmentation along political lines, with trade growth between opposing blocks being slower than within them.
Tensions between Europe and China are growing as China's industries produce goods more cheaply, leading to fears that European industries will struggle to compete and could face severe losses. This overproduction in China can result in price wars and ultimately threaten the stability of the European economy. Europe is China's largest regional trading partner, and experts worry that the situation could worsen as China promotes high-end manufacturing to boost its self-sufficiency.
