"The escalating trade clash between the U.S. and China has investors on edge, fearing it could mark the beginning of the end for global cooperation as we know it. On Friday, President Donald Trump called China's new export controls "extraordinarily aggressive" and "hostile"; he threatened a retaliatory 100% tariff. (He later sought to deescalate the situation, calming U.S. markets.) For Kristalina Georgieva, head of the International Monetary Fund, it's just another day in the office."
""Frankly, this thing that trade is dead is completely overstated," Georgieva told Fortune's Diane Brady. "Trade is like water. You put [up an] obstacle, it goes around it." And while Georgieva recognizes the world is becoming "foggier" and full of uncertainty, one of the biggest challenges comes from getting buy-in that cooperation is better than division: "We are in this one big boat. It is a rough sea. We better row together.""
"Luckily, many countries already subscribe to this philosophy. She pointed out that following the onset of U.S. tariffs earlier this year, 188 out of the IMF's 191 member states did not choose to retaliate. Instead, they've turned to regional partners for trade. Southeast Asia and the Gulf region are two examples she cited. Even China has benefited from diversifying its trade portfolio: overall exports rose 8.3% in September-the highest total this year-thanks to strong trade growth with the European Union."
U.S.-China trade tensions spiked after U.S. criticism of new Chinese export controls and a threatened 100% retaliatory tariff, followed by efforts to calm markets. Global trade resilience persists as obstacles prompt rerouting of flows rather than collapse. Most IMF member states avoided retaliatory tariffs and shifted trade toward regional partners such as Southeast Asia and the Gulf. China recorded an 8.3% rise in overall exports in September, helped by stronger EU demand, while shipments to the U.S. fell 27% that month. The private sector remains agile and can help sustain cooperation amid growing uncertainty.
Read at Fortune
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