A new report from the World Economic Forum (WEF) has unveiled significant economic risks stemming from increasing geoeconomic fragmentation. The report, titled Navigating Global Financial System Fragmentation, warns that statecraft policies leading to fragmentation could reduce global GDP by up to $5.7 trillion.
This potential loss surpasses the economic shocks witnessed during the 2008 financial crisis and the COVID-19 pandemic, highlighting the gravity of the situation. The report emphasizes that unilateral policies and fragmented financial systems threaten global economic stability and growth.
In an interview with CGTN, Matthew Blake, Head of Financial and Monetary Systems at the WEF, shared his insights on these findings. Blake stressed the importance of global collaboration and strategic foresight to mitigate the risks posed by fragmentation. He noted that without concerted efforts, the far-reaching impacts could hinder economic progress and exacerbate global inequalities.
\"The interconnectedness of our global economy means that fragmentation doesn't just affect individual nations—it has a ripple effect worldwide,\" Blake said. \"We must prioritize cooperation and open dialogue to navigate these challenges effectively.\"
The report calls on policymakers, business leaders, and international organizations to work together to address the root causes of fragmentation. By fostering inclusive and collaborative economic policies, the global community can safeguard against significant GDP losses and ensure sustainable economic growth for all.
Reference(s):
WEF: Geoeconomic fragmentation may cut global GDP by $5.7 trillion.
cgtn.com
