The Gulf and the Global Reset: Trade Wars, Economic Realignment, and a Region Thinking Several Moves Ahead
The term "trade war" is misleading. What began under President Trump with tariffs on Chinese steel and tech imports was never about trade alone. It marked the re-emergence of industrial policy, strategic competition, and economic fragmentation
a shift that continues to accelerate under new labels and different administrations.
Globalisation, once treated as an inevitable arc of progress, has given way to a world defined by selective cooperation, economic pressure tools, and national interest taking priority over global integration. In this environment, supply chains are being restructured, investment flows are being redirected, and influence is being redefined not through soft power speeches but through ports, resources, and capital.
This is the context in which the Gulf is operating. And this is why the Gulf matters.
Strategic Geography, Re-understood
The Gulf's location has always carried weight, but that weight grows as traditional trade flows are interrupted. The Bab al-Mandab, the Strait of Hormuz, and the surrounding maritime infrastructure now sit between increasingly competitive blocs. As the US and China recalibrate access to markets and energy and Europe looks for new supply routes, the Gulf’s role becomes far more than that of a regional logistics player.
Rather than being a passage, it is becoming a platform for manufacturing, re-export, and value-added processing. Initiatives like the Saudi Global Supply Chain Resilience Initiative and the UAE’s continued investment in global port networks signal a deeper understanding of this role.
Tariffs, Fragmentation, and the Return of Industrial Policy
The tariff wave that started in 2018 was a declaration: Economic engagement would now be shaped by leverage, not liberal theory. Tariffs on steel, semiconductors, solar panels, and rare earths were the opening moves. What followed was a surge in industrial subsidies, reshoring incentives, and investment screening, especially in tech and energy-related sectors.
These pressures push multinational firms to rethink where they operate, how they hedge political risk, and where they anchor their supply chains. The Gulf enters this picture not as a workaround but as a jurisdiction capable of hosting strategic sectors — with modern infrastructure, government agility, and access to both developed and emerging markets.
Energy as Leverage, Not Reliance
In a fragmented world, energy security becomes more important, not less. The Gulf’s approach reflects this shift. Instead of chasing headlines with green pledges, countries in the region are strengthening their positions in the global energy matrix: investing in advanced refining, building stakes in critical minerals, and securing bilateral energy deals that tie economic interests to political ones.
The Gulf’s energy strategy is focused on extending reach across the entire spectrum, from LNG and hydrogen to renewables and advanced refining.
Energy today is more than a commodity; it is a channel of alignment, access, and influence. Countries that manage their flow set terms, shape partnerships, and open doors to deeper strategic relationships.
Capital with Direction, Not Distraction
Sovereign wealth funds in the Gulf are directing capital toward sectors that shape the future balance of power, artificial intelligence, defence technology, agri-tech, logistics automation, and biotech. These investments build long-term advantages by strengthening control over supply chains, advancing domestic capability, and increasing strategic relevance in global markets.
Gulf strategies are centred on alignment with rising power blocs and on securing leadership positions across industries that matter most in the decades ahead. This approach supports resilience, influence, and flexibility in a rapidly evolving global economy.
The Gulf’s Next Chapter Is Being Written Quietly
The Gulf is steadily expanding its infrastructure, deepening partnerships, and strengthening its global position through clear, long-term planning. Every move is grounded in economic discipline, regional ambition, and an accurate reading of global dynamics.
For investors, multinational companies, and policymakers, the region offers a clear path to strategic engagement, not as an alternative, but as a key component of the global economic landscape.
The question now is: Can anyone afford to overlook it?
