Page 9 - Policy Economic Report - April 2025

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

Figure 4: Global Trade Outlook (% of GDP)

Source- IMF

Even though world trade-to-GDP ratios remain relatively stable, significant shifts in trade patterns are
taking place, especially since the start of the war in Ukraine in February 2022. The growth in trade flows
between geopolitical blocs has declined significantly since then compared with growth of trade within
blocks. This reallocation of trade flows is occurring in the context of rising cross-border trade restrictions,
with about 3,200 new restrictions on trade in 2022 and about 3,000 in 2023, up from about 1,100 in 2019,
according to Global Trade Alert data, and increased concerns about supply-chain resilience and national
security.

2. ADB forecasts growth declining for Asia and the Pacific

Economies in developing Asia and the Pacific are projected to grow 4.9% this year, down from 5.0% last
year, according to the latest forecast by the Asian Development Bank (ADB).

Solid domestic demand and strong global appetite for semiconductors driven by the artificial intelligence
boom are supporting growth, but tariffs and trade uncertainty will act as a headwind. Regional growth is
expected to decline further to 4.7% next year, according to Asian Development Outlook (ADO) April 2025.
Inflation is projected to moderate to 2.3% this year and 2.2% next year as global food and energy prices
continue to decline.

The growth forecasts were finalized prior to the 2nd April 2025 announcement of new tariffs by the US
administration, so the baseline projections only reflect tariffs that were in place previously. This will get
further revised down in its report in July, 2025.

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