The WTO’s Global Trade Outlook for April 2025, published on Wednesday, 16 April, presents a grim view of international trade, one marred by reciprocal tariffs and fears of a worldwide trade war.

In its first report since Trump’s broad-ranging tariffs came into effect, the WTO revised its estimates of global trade volumes, forecasting they would fall by 0.2% in 2025 and pick up slightly in 2026, rising by 2.5%. In the October report, trade volumes were predicted to rise by 3% in 2025 after a strong 2.7% growth in 2024.

A forecasted 1.7% reduction in North American trade is largely responsible for the shift, while merchandise trade is expected to keep rising, albeit less than previous estimates, in the rest of the world. The most marked decrease is expected to be in Asian trade, now forecasted to only grow by 0.6% compared to the impressive 7.4% growth projected in the October report. 

This comes as tariffs imposed by the Trump administration come into effect all over the world; while many of the headline-making country-specific tariffs have been halted for 90 days, the 10% baseline tariff remains for all exports to the US. Nevertheless, the trade uncertainty caused by the tariff announcements and fears of further tariffs on specific industries, like pharmaceuticals or metals, is responsible for the “significant reversal” in estimates, said the WTO. 

US tariffs on China, the only ones not subject to the 90-day delay, currently stand at 145%, with a 125% reciprocal tariff levied by China on US goods. This is expected to lead to a sharp fall in US imports from China, creating opportunities for suppliers from emerging economies to fill the gap. Similarly, Chinese exports to all regions except North America are expected to rise by as much as 9% as goods are redirected outside the US.

If the currently suspended tariffs were to come into effect, they would lead to a further reduction of 0.6% in global trade, with emerging economies bearing the brunt of the effect. A rise in trade policy uncertainty, for example if more countries enacted reciprocal tariffs against the US, could lead to a further 0.8% decline, for a total of -1.5% trade growth in 2025.

The report marks the first time the WTO measures trade in services, a growing but oft-overlooked sector in global trade. Services trade is expected to grow significantly in 2025, but tariff-related uncertainty and a decrease in global trade will see it rise by just 4%, more than a percentage point below pre-tariff estimates. 

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The web-based solution, called Global Trade Konnect (GTK), was conceived as a combination of Komgo’s most successful products over the past six years and will function as a full-stack solution for corporates looking to take control of their trade finance operations. 

As international tensions rise and fears of a global recession come closer and closer to reality, companies are rushing to strengthen their risk strategies. Trade finance can play a crucial role in increasing resilience and optimisation – but challenges like information misalignment, inefficiency, and fragmentation can make processes much slower and more complicated than they need to be.

This means having the correct tools to handle internal processes and overcome these challenges is becoming more and more important. Through GTK, Komgo proposes a scalable, smart, and connected solution to simplify daily trade finance operations through digital management. 

GTK is intended as a combination of a series of Komgo products covering all aspects of the trade finance pipeline and its instruments, from standby letters of credit to corporate guarantees and contracts. Capabilities from @Globaltrade, the platform Komgo acquired with GTC, will be combined with the secure communication channel and longtime Komgo staple Konsole APIs, digital document layer Trakk, and AWS’s advanced cloud capabilities.

Through streamlined and secure communication channels, companies will be able to replace emails, paper documents, and wet-ink signatures with a single digital workflow. This will enable them to manage the entire life cycle of thousands of trade instruments all in one place, which will be integrated with a range of communication channels to enable connectivity with all financial institutions. 

Advanced AI integration will drastically increase efficiency, accelerating manual processes by at least 50%. Automatic letter of credit drafting and checking, fee calculation, and bank guarantee issuance will streamline processes, while accurate and timely notifications will make it possible for even non-automated steps to be completed more quickly.

GTK’s reporting capabilities will make it easier to generate operational reports and analytics, and the data it generates will give companies the power to make accurate forecasts and improve their decision-making. 

Through GTK, Komgo has harnessed the power of the most exciting technological advancements – document digitisation, interconnectivity, and AI – to produce a copilot for corporates looking for a way to manage their trade finance activities. In today’s highly fragmented, fast-moving world, companies must be flexible and resilient. GTK promises to bring the best of Komgo to help them navigate this.

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Corporate lending and trade finance are undergoing a transformation – that much, everyone can agree on. Digitisation, AI, and a market that is in constant motion make the industry one of the most exciting sides of finance, ripe with opportunities as much as challenges. 

However, how to overcome these challenges – especially in a complicated geopolitical landscape – and evolve with the opportunities remains a hot topic.

Finastra, a global provider of financial software applications, hosted its annual Europe Corporate Banking Day along with sponsors Microsoft and Tech Mahindra to discuss just that.  In London, senior executives from across the banking, technology and sustainability sectors came together to discuss the key market and technological trends in the industry: here are 5 of their main insights.

​​1. The market is shifting

Institutional investors and private credit are increasingly dominating the market, with growing appetite for direct lending as borrowers seek the best financing options. However, the lending industry still faces many challenges related to transparency, interconnectivity, inefficiencies and balancing regulation with innovation. 

Global political and economic fluctuations are also creating new trade corridors, requiring institutions to be agile and flexible and driving a shift from payables to receivables finance. 

2. Corporates expect seamless services, but digitisation remains a challenge

Corporates demand banking services that are personalised, digital, instant, and both local and global. However, an audience poll identified digitisation as the biggest challenge and opportunity, cited by 44% of institutions. Across the industry, data remains largely in paper form, creating significant barriers. 

Banks must invest in customer-centricity by implementing truly digital customer journeys, straight-through processing and automation and reduce loan approval time. Technologies such as cloud, microservices, APIs, digital ecosystems, and agentic AI will play an important role in banking’s evolution.

3. Industry expertise is declining 

As the next generation enters the workforce, institutions must capture knowledge from experienced workers before they retire, storing it in a structured database. More admin-focused roles must be migrated, upskilled, and digitized to attract younger talent. An audience poll revealed that talent attraction and retention were the biggest challenge and opportunity for almost a quarter of respondents.

4. AI is here to stay

When implemented correctly, AI can augment human capabilities, deliver automation and increase efficiency and speed in ways that would have been unthinkable just a few years ago. Large language models serve as a valuable resource for information, bridging knowledge gaps and facilitating faster decision-making. With AI, institutions can, for example, issue more letters of credit and digital trade agreements and better track, report, and fulfill sustainability commitments. 

AI can speed up document processing, compliance checking, and contract approval times. In the future, we may see autonomous supply chains and transaction processing as well as augmented smart contracts with instant settlement, all thanks to AI’s constant evolution.

5. Tokenisation experiments in trade finance 

Although it has been discussed for many years, banks today are increasingly experimenting with tokenisation. Innovations such as smart contracts and stable and risk coins can drive greater efficiencies in trade settlement and post-trade processing, improve risk management, and provide more effective access to capital. With routers, multiple use cases can be created.

However, despite the opportunities, the lack of industry standards remains a challenge. On the other hand, some argue that standards can stifle innovation and therefore should only be established once market connectivity is achieved.  

The event speakers included leaders from Finastra’s Lending business unit, such as Andrew Bateman, Lekshmi Nair, Robert Downs, Anastasia McAlpine, Sandrine Markham, Elena Sankova and Julian Lee. Other speakers represented institutions such as Microsoft, Tech Mahindra, ING, Loan Market Association, ITFA, Crédit Agricole CIB, Norddeutsche Landesbank Girozentrale and CredAble.

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With more details being released by the US and some countries already releasing significant retaliatory tariffs, a clearer picture is emerging – one of a global economy which will be, at least for a short while, deeply affected by the sweeping tariff regime. Changes and adjustments resulting from this are expected to have far-reaching effects on the global trade industry, diverting trade flows and transforming supply chains. 

When Asian markets opened this morning, it was clear their adjustment to Trump’s tariffs was far from over. Japan’s Nikkei lost 7.8% and China’s main index, the Shanghai composite, lost 7.3%, the biggest fall since the 2020 pandemic. Hong Kong’s Hang Sei index had the biggest one-day drop in 28 years, closing at -13.2%. On the other hand, Asian currencies may see a resurgence as investors move away from the dollar and towards “safe havens” like the Japanese yen, Swiss franc, and Euro, all of which have risen in the past few days. 

Many Asian countries have been among the hardest-hit by Trump’s tariffs, with China subject to a staggering total 54% tariff. The US is by far China’s biggest trading partner, and the recently announced 34% retaliatory tariff is expected to hit US exporters hard when it goes into effect on 10 April. 

The two most important Indian stock indexes fell by around 5% on opening, likely in response to the 26% tariffs imposed by the US. This was in part driven by Tata motors, one of the largest Indian auto companies, which fell by over 10%. Jaguar Land Rover, one of its subsidiaries, was the first major company to announce it would halt shipments of its UK-made cars to the US due to the tariffs levied on the global auto industry. 

Amid fears of a US recession – which analysts like Goldman Sachs are now forecasting with near-certainty if all the tariffs go into effect as announced – oil prices have also dropped to a 4-year low. Brent crude, the benchmail oil marker, has continued its fall started on Friday, now costing $63.49 a barrel compared to last year’s average of about $80. 

European markets, which opened just a few hours ago, are experiencing similar shockwaves. While the UK has been widely seen as avoiding the worst of the tariffs, only being subject to the baseline 10% tariff levied against all countries (even uninhabited Antarctic islands), London’s FTSE 100 lost 4.9%. The German stock exchange fell by 10% when markets opened but has now recovered to just -5.9%, while the French Cac 40 fell by 5.7%.

This is as EU members grapple with high tariffs of 20% as well as a 25% tariff on foreign cars set to go into effect soon, which is expected to affect the already struggling German auto industry. Companies with complex supply chains, like car manufacturers, could see an exponential effect of tariffs, especially if an intermediate step of the manufacturing process happens in the US. 

The agricultural industry, too, could experience significant turbulency, as some of the countries most affected by the tariffs, such as Vietnam and Taiwan, are also among the world’s biggest coffee, cocoa, and crop exporters. This could have a ripple effect both in consumer purchasing power and in global supply chains – for example, strengthening trade between the US and Brazil, another big coffee producer that has been hit less by the tariffs. 

As companies look into diverting their supply chains, smaller players might unexpectedly come at the forefront of global trade. San Marino, a small city-state on the Adriatic coast of Italy, has been eyed as a way for some EU countries to evade US tariffs, which are 20% on the EU but only 10% on San Marino. 

It’s still hard to tell just how much the tariffs will impact the global economy, and how – as seen by the volatile response of markets to the changes. Retaliatory tariffs on the one hand could exacerbate the situation and lead to an all-out global trade war, while negotiation attempts could de-escalate current tensions and lead to a much softer impact on the global economy.

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After months of starts and stops, threats and retreats, Liberation Day is upon us. The Trump administration’s promised wide-ranging regime of tariffs, a cornerstone of his winning presidential campaign, was set for 2 April. Some countries scrambled to negotiate last-minute deals while others are searching for ways to restructure their supply chains – often by moving closer to the US’ s rivals – all in the wake of what is anticipated to be the biggest unilateral tariff escalation since the 1950s Cuban embargo. 

Amidst the confusion and ever-changing policies, the TFG team has compiled a summary of the story thus far and the tariffs as they stand now – updated live every day.

How did we get here?

Throughout the US presidential campaign last year, trade and tariffs have been at the forefront of Republican messaging, forming a core part of Trump’s plan to revive the US economy. While blanket tariffs – of as much as 60% on US rivals like China – were memorably floated during rallies and speeches, more recent declarations by the Trump administration have focused around so-called “reciprocal” tariffs. 

These unilateral import taxes are meant to “make up for” trade barriers that (the President believes) are being unfairly levied against the US, in the form of taxes, subsidies, regulation, and red tape. This seems to suggest that tariffs will vary wildly between countries and even from one industry to the next depending on their importance to US trade and the level of trade barriers. That the tariffs are, at least, in part, targeted towards ending “unfair practices that have been ripping off [the US] for decades” suggests that negotiation is possible, and proposed tariffs may be reduced or lifted if receiving countries make concessions on US exports. 

Tariff timeline

1 February – Trump announces tariffs on Canada and Mexico

In a series of executive orders, Trump imposed a 25% tariff on nearly all goods from Canada and Mexico, scheduled to come into effect on 4 February. Canadian oil and energy imports would have been exempt from this, instead only being taxed at 10%. In the same set of orders, Chinese imports are set to be subject to a 10% tariff on top of currently existing taxes. 

3 February – Trump delays tariffs after retaliation threats

The day before the 25% tariff was set to begin, the Trump administration reached a deal with Canada and Mexico’s leaders to delay them by a month after the two countries threatened strong retaliatory taxes on American exports. 

4 March – Canada and Mexico tariffs really do come into effect

A month after the tariffs were meant to begin, US tariffs against Canada and Mexico came into effect, as did Canada’s retaliatory levies. The White House also announces a doubling of blanket tariffs on Chinese goods, from 10% to 20%, set to start the following day. 

6 March – Trump delays (some) tariffs, again

Just two days after the US–Canada–Mexico tariffs come into effect, the US once again delays tariffs on about half of goods – those covered by the USMCA free trade treaty – by another few weeks. The full set of tariffs are now scheduled to go into effect on 2 April. 

2 April – Liberation Day

Most tariffs on all industries and all areas of the world are expected to be announced, and some even to go into effect, today. This is likely to affect even countries that have already been affected by some tariffs and those who have long-standing trade agreements with the US. It is also the day that the USMCA exemption, which lifted tariffs on many Canadian and Mexican goods, will run out, leaving the US’s two main trading partners facing steep tariffs that may not be delayed again. 

3 April – Auto tariffs

Proposed tariffs specifically targeting passenger cars and trucks from any country, speculated to be as high as 25%, are set to go into effect on 3 April. 

3 May – Deadline for tariffs on auto parts

According to the same executive order that imposed tariffs on cars, a 25% tariff on auto parts will go into effect before 3 May. 

TFG Tariff Tracker

As information about the new tariffs is released throughout the day, the TFG team will keep updating the timeline and publish summaries of which industries and areas are being most affected. 

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This comes in anticipation of a flurry of tariffs expected to be released by the US on 2 April. As both companies and countries scramble to plan a response to the tariffs, China may be looking for a way to increase its own resilience and take up some of the US’s declining dominance in global trade. 

The French and Chinese foreign ministers met in Beijing yesterday to discuss deepening cooperation between the two countries, with Chinese foreign minister Wang Yi vowing to “uphold multilateralism [and] oppose unilateralism” in clear opposition to Trump. The officials agreed to strengthen economic relations between France and China by encouraging Chinese investment in France and working together on a range of industries, from agriculture to artificial intelligence. 

This move is especially significant as the EU and China have been involved in a trade spat since October, when the bloc imposed high tariffs on China’s auto industry and China retaliated by taxing European brandy imports, hitting the French cognac industry hard. That the two countries are vowing to increase cooperation and find a solution to the reciprocal tariffs is a significant step, which may in part be in an effort to present a united front to upcoming US-imposed sanctions.  

On the industry side, Xi met with over 40 CEOs and executives from companies around the world including FedEx, AstraZeneca, and Standard Chartered to discuss supply chain resilience and stability. The meeting is ostensibly just a second iteration of an event held at the same time last year with US executives and occurred just a few days after the China Development Forum, China’s most important business summit. However, the backdrop of US sanctions clearly influenced the discussions, which reportedly centred around increasing resilience and cooperation. 

While some governments are scrambling to hold last-minute negotiations to decrease the impact of tariffs, many others are looking for alternative trade partners to diversify their export markets and increase resilience. At the same time, companies – especially those with complex supply chains which may experience an exponential effect from tariffs – will be searching for ways to protect their supply chains and be less reliant on US markets. 

China, which has been grappling with slowing growth and weakening domestic demand, could be hard-hit by the sanctions too – especially with its $800 billion car and EV industry facing high tariffs. China may be looking to place itself as a viable alternative to the US when it comes to restructuring supply chains, courting Western and emerging economies alike.

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The biannual report described decreased expectations of global GDP growth and rising volatility; policy uncertainty, geopolitical risk, trade barriers, and fragmentation unsurprisingly emerged as the main threats to trade in 2025 and beyond. 

Perhaps the most consequential finding of the report is a revision of past predictions of global GDP growth, which would have seen it slightly rise to 3.3% from 2024’s 3.2% and hold steady in 2026. Due to increased uncertainty and rising trade barriers, growth is instead now projected to slow to 3.1% in 2025 and 3% in the following year. 

This is driven by a significant slowing in US growth, projected to decrease by a full percentage point from its current level in 2026, and similar slowing growth in G20 countries. Developing countries will be the ones driving growth, with India, Indonesia, and Türkiye all rapidly increasing the size of their economies. Slowing growth may help decrease inflation globally, which remains above the targets set by central banks in many countries.

While uncertainty has been increasing worldwide, with consumer confidence hitting 2-year lows in much of the Americas, trade policy uncertainty has increased exponentially in recent months, the report found. This is likely related to President Trump’s tariff plans, which threaten to impose heavy duties on the US’s main trading partners in an effort to boost domestic producers and make trade fairer. 

After a series of false starts, in which tariffs against Mexico and Canada were quickly levied and just as quickly lifted, the Trump administration has promised a sweeping tariff regime to go into effect on 2 April, nicknamed “liberation day”. Mexico and Canada were most affected by the rise in uncertainty; these two countries, as well as the US and Brazil, experienced slowing growth in the past months, mainly driven by the services sector shrinking.

Increased tariffs aren’t just affecting uncertainty. The OECD predicts that tariffs were they to go ahead, will be “a drag on global activity” and “add to trade costs, raising the price of covered imported final goods for consumers and intermediate inputs for businesses”. This effect will be amplified in regions with highly international, integrated supply chains, as the North American market is, potentially multiplying the effect of tariffs and driving unprecedented supply chain transformation. 

On the flip side, the OECD report sees potential for sustained growth if tariffs were removed and technology harnessed to boost productivity. An optimistic prediction of high AI adoption with robotics integration is projected to add over 1.4% to annual labour productivity over 10 years, while a more modest prediction of high integration with adjustment frictions is still expected to add over 0.6%. The report also highlights the importance of encouraging competitiveness in domestic economies, a measure which has consistently gotten better over the past 6 years; the UK has maintained its position as the most competition-friendly of the countries surveyed. 

While the risk of tariffs and a retaliatory regime that might give way to an all-out trade war could be destructive, international cooperation could open the door to rising growth. Diversification, and strengthening supply chains will be a useful stopgap for firms affected by the tariffs and should be encouraged by national policies. However, a sustained effort to reduce fragmentation and multilaterally lower tariffs is the only thing that will bring the global economy back to sustained growth. Geopolitical risk, driven by conflicts in Europe and the Middle East and their effect on trade routes and energy prices, contributes to an undercurrent of volatility and uncertainty; developments in those conflicts or other simmering global conflicts could further contribute to rising or lowering consumer confidence and uncertainty.

The report paints a sobering but potentially optimistic picture for the months ahead. While fragmentation and tariffs are driving uncertainty and slowing growth, technology and cooperation can have a mitigating effect and contribute to higher productivity. 

The first takeaway from the report, then, is that once again, trade and tariffs dominate global economic developments; trade barriers and geopolitical risk can have destructive effects worldwide, but will also be the key to promoting growth. Unlike the global disruption brought on by the pandemic, which seemed like a sweeping, uncontrollable force, or last year’s geopolitical volatility that was hard to contain or predict, 2025’s global challenges are entirely within the international community’s control – as is fixing them. 

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• While largely effective, economic sanctions bring problems in terms of compliance and supervision.
• This is a remit where technology, in particular AI solutions, can help.
• There is space for sanctions authorities to innovate more, particularly considering how frequently sanctions are used.

In 432 BC, a messenger sent by Athens to Megara, a nearby rival city, was unceremoniously killed after delivering his message. To retaliate, Pericles, the Athenian leader, issued a decree banning any Megarian traders from Athenian ports and marketplaces: thus, the first sanction was born. Sanctions, tariffs, and embargoes have developed since Ancient Greece, most recently becoming a hot topic in global trade when most Western countries imposed sanctions on Russia after its illegal invasion of Ukraine in 2022. 

Modern sanctions are becoming more sophisticated, and more complex, than ever; on top of straightforward tariffs and embargoes, specific financial tools can be used to cripple a country’s economy and connection to the outside world, such as when the EU and US blocked Russia’s access to the SWIFT financial messaging system in 2022.

For companies operating across multiple countries, some of which may be the object of sanctions, negotiating these barriers while staying within the law in both jurisdictions is crucial. At the Economic Sanctions Summit in London on 20 March, a panel of lawyers and compliance officers discussed how to navigate the most difficult aspects of sanctions and how technology tools like AI can help. 

The strain of sanctions

Whenever a government announces sanctions against another country, it – often correctly – sees financial institutions as the first line of defence, making sure no money goes where it shouldn’t. However, this puts a strain on those institutions in the form of additional supervision, audit, and compliance to adhere to the sanctions – which can often imply a higher workload for compliance and a strain on resources. 

While AI solutions have been hailed by almost every sector for their revolutionary automation capabilities, compliance and audit are where AI’s potential can truly be life-changing. AI tools – which can range from simple rule-based automation to generative AI tools that mimic what a person would do in a situation – can massively simplify and speed up financial institutions’ sanctions screening process. 

To be approved by regulators, however, AI solutions can’t be completely autonomous: a human component, whether as an oversight or double checking the AI’s work, is important to maintain transparency and explainability. “Solutions that run on AI models should be designed in a way that the user of the solution can explain why the solution is making certain decisions […] to internal audit, external audit, regulators, [and] clients,” said a panelist at the event.

Effectiveness vs efficiency: The data problem

The way to train AI, especially generative models, is data – which makes having enough accurate, up-to-date information on past transactions more important than ever. Using narrow data points and applying AI solutions gradually to individual aspects of compliance can help make the first line of defence faster, cheaper, and more efficient. 

A crucial step for companies adapting to shifting sanction regimes is training their staff – both in using and working with AI models, and on the evolving compliance requirements imposed by sanctions. Sometimes, AI-powered tools can do more harm than good, especially if they produce so many false positives that their alerts swamp the teams in charge of reviewing them. Having the correct data can go a long way to increasing the efficiency of those tools without compromising on accuracy.

Compliance teams have other tools to screen clients which have been used for years before AI came into the scene and are for the most part still useful – tools like due diligence procedures, understanding a client and their business, and investigating clients’ ownership structures. However, many in the industry feel that technology hasn’t been used to its full potential, leading to outdated processes that are not keeping up with the development of sanctions. “In the last 10 years, we’ve seen significant evolution in the way the sanctions are used and […] the innovation that’s been tried by sanctions authorities […] hasn’t really moved with that evolution,” said a panelist. 

From compliance to litigation

Another important but oft-overlooked aspect of adapting to sanctions is managing the litigation brought by parties from the affected country against financial institutions enforcing sanctions. Russian firms have been known to sue banks that do not honour their obligations to comply with EU sanctions, leading to a lengthy and costly litigation process. 

The possibility of legal proceedings makes it even more crucial to have a clear view of how decisions about sanctions compliance are made and document every aspect of the process to protect firms against accusations of unfairly flagging transactions. On the flip side, having well-documented procedures can also shield a company that has done everything it could to comply with sanction regulations from legal liability if those efforts ultimately failed. A recent Court of Appeal decision reinforced the importance of this, confirming that if the relevant person of a firm is able to show that they reasonably believe their actions comply with UK sanctions regulations, then that is a defence to civil liability.

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In today’s precarious global geopolitical situation, sanctions are unlikely to go anywhere anytime soon: while they can sometimes be more a precursor than an alternative to more overt warfare – the Athenian sanctions in 432 BC were shortly followed by the Peloponnesian War – they are a crucial diplomatic tool for rival countries. Financial institutions are often at the centre of sanction enforcement, acting as one of the first and last lines of defence. This makes it crucial for their audit and compliance teams to stay on top of developments in regulations and make the most of tools, like AI-powered solutions, to make applying sanctions easier and more accurate. 

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This comes amidst reports that the Chinese government would be investigating CK Hutchinson’s sale of the two key Panama ports to US investment giant BlackRock, in a deal likely partially motivated by President Trump’s plans to place the crucial waterway back under American control. 

On Tuesday, 18 March, Bloomberg reported that senior Chinese government officials have instructed state agencies, including the State Administration of Market Regulation, China’s main antitrust agency, to study the sale for potential breaches of security or antitrust issues. The deal, announced on 4 March, involves CK Hutchinson, a Hong Kong-based conglomerate, selling controlling stakes in a total of 45 ports in 23 countries, including the Balboa and Cristobal ports, to a group of investors backed by BlackRock. This would make BlackRock the world’s third-largest port operator, giving it control over 10.4% of global container traffic. 

The deal was speculated to have been at least partially due to Trump’s insistence that the Panama Canal go back under US control, which he reiterated during the State of the Union address. While the proposed sale would not give the canal itself back to the US, instead handing over management of two ports at either end of it to an American company, the Trump administration has claimed it as a win.

However, pushback from China and Hong Kong, as well as Panama, whose government needs to approve the sale before it goes ahead, is threatening to jeopardise the deal. A spokesperson for the Chinese foreign ministry commenting on the deal said that “China has always firmly opposed the use of economic coercion, hegemonism and bullying to infringe upon the legitimate rights and interests of other countries,” while John Lee, Hong Kong’s Chief Executive, said on Tuesday that the country opposed “the abusive use of coercion or bullying tactics in international, economic, and trade relations.”

While neither the Chinese nor the Hong Kong governments have explicitly spoken out about the sale and lack an obvious route to stopping it as the buyer and port are outside Chinese territory, oblique statements and the rumoured additional scrutiny on the deal are likely to further delay the sale. 

The Chinese government could intervene with the sale by using antitrust laws that restrict extraterritorial sales with an effect on domestic competition or by designating the sale as having national security implications. While direct action to completely halt the sale is unlikely, recent comments and the reports of an investigation into the deal point to increased government scrutiny and potential pushback. China isn’t alone in disapproving of the deal, with Panama’s president, José Raúl Mulino, saying on 5 March in response to Trump’s comments that the canal “is Panamanian and will continue to be Panamanian.”

China, Hong Kong, and Panama’s pushback against the deal risk disrupting the sale placing a shadow of uncertainty on one of the few global shipping channels that have been until now unaffected by geopolitical tensions and delaying BlackRock’s proposed investments in the ports. In the wider context, this could represent a further trend of resistance to the US’s recent efforts to regain the hegemony of the last century. 

The Trump administration’s attempts to place itself back at the centre of the global political and economic stage through increased tariffs, involvement in major conflicts, and attempts to exert more control on emerging economies have all been met with international pushback. Global trade is one of the industries most affected by this, thanks both to its inherent vulnerability to geopolitical uncertainty and to Trump’s aggressive tariff strategies; that international attention is shifting to crucial shipping channels could put the industry even more on edge, potentially affecting supply chains all over the world. 

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Investment giant BlackRock’s plans to buy the Panama Canal, likely motivated by US President Donald Trump’s insistence on restoring the crucial trade route to US control, look set to encounter pushback from the Panamanian government. 

Panama’s President José Raúl Mulino said on Wednesday 5 March that Trump was “lying” about the US reclaiming the canal, which Mulino said “is Panamanian and will continue to be Panamanian.” On Friday, Panama announced its Maritime Authority, which is responsible for oversight of Panama’s port infrastructure, would request all legal and financial documents involved in the sale of two key ports on either end of the Canal to a group of investors backed by the US asset management firm. 

In the first months of his presidency, Trump has made aggressive foreign policy a centrepiece, with bids to increase US involvement in Gaza, buy Greenland, and a much-rebuffed plan to take over Canada. Trump has also been increasingly vocal about taking back the Panama Canal, which the US built but ceded to the Panamanian government in 1999. 

The waterway is now run by the Panama Canal Authority (AMP), an independent entity whose board is appointed by the government. In his State of the Union speech, Trump said the US was “taking back” the canal, accusing the Panamanian government of having “essentially given it, ceded it, to China”. While the canal itself is under AMP control, the key ports of Cristobal and Balboa, at either end of the waterway, are operated by Hong Kong firm CK Hutchinson under a 25-year concession. The two ports regulate access to the canal from the Atlantic and Pacific oceans, respectively, acting as crucial logistics points for goods between the US, Latin America, and the rest of the world. 

The sale, which has not been finalised yet, would see CK Hutchinson hand over an 80% stake in the two ports, as well as 41 other ports across 23 countries, to US investment giant BlackRock for £17.8 billion. Frank Sixt, co-Managing Director of CK Hutchinson, said in a statement that “the transaction is purely commercial in nature and wholly unrelated to recent political news reports concerning the Panama Ports”. However, Bloomberg reported that Larry Fink, CEO of BlackRock, pitched his plans to Trump on the phone before finalising the deal. 

The canal is one of the world’s busiest shipping routes, handling 5% of global maritime trade and 40% of all US container traffic. The waterway looks set to become even more crucial as trade routes shift: proposed sanctions to Mexico and Canada could see an increase in maritime trade to the US, increasing traffic in a canal that already sees over 14,000 ships pass through it a year. 

Government opposition, however, could slow or even halt BlackRock’s acquisition: the transaction must be approved by the government, which has been publicly critical of plans to cede control to the US.

This may in part be motivated by Trump’s stated intentions to force authorities to stop charging US companies for transit. Panama’s economy rests heavily on the canal, which accounts for almost a quarter of the country’s GDP, and 70% of ships passing through the waterway are bound for the US. 

On the other hand, a new administration under US control could drive investment to the ports, increasing efficiency and reducing delays. While less vulnerable to recent shocks than other global shipping hubs, the Panama Canal has seen disruptions due to cyclone-driven droughts and geopolitical risk, leading Maersk to temporarily reroute some of its goods to rail freight last year. A more modern and resilient canal could bode well for global trade, but disruptions caused by US-Panama tensions place a key trade route at more risk than usual.

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