{"text":[[{"start":8.6,"text":"The world economy is at risk from the “tit-for-tat” economic warfare breaking out between nations, the IMF’s outgoing chief economist has warned. "}],[{"start":17.049999999999997,"text":"Pierre-Olivier Gourinchas said that, with globalisation in retreat, countries were increasingly imposing trade barriers or exploiting “chokepoints”, such as Iran’s closure of the Strait of Hormuz, for political gains."}],[{"start":30.549999999999997,"text":"“You’re trying to exploit the fact that you control critical minerals or rare earths. Well the rest of the world is going to try to build supply chains that go around that,” Gourinchas said. “You’re trying to control the Strait of Hormuz — well, maybe you succeed for a little while, but other countries are going to build pipelines.”"}],[{"start":49.3,"text":"Tehran’s closure of the strait, through which a fifth of the world’s energy resources flowed, in retaliation for US and Israeli attacks in late February sparked a surge in global energy prices — and renewed talk of oil-rich countries in the region expanding their pipeline capacity to bypass the waterway."}],[{"start":67.05,"text":"He added: “The risk is that we get in a world of tit-for-tat — with countries continually trying to exploit the small advantages they have in a way that is ultimately self-defeating.”"}],[{"start":78.2,"text":"Gourinchas spoke to the FT on Friday just before US President Donald Trump threatened European countries with a 100 per cent tariff on their exports to America should they follow through with threats to impose digital services taxes that Washington believes would punish the US tech industry."}],[{"start":96.7,"text":"Tariffs have been at the foundation of the Trump administration’s economic strategy. While many of the most aggressive trade tariffs the US president has tried to impose were ruled illegal by the Supreme Court earlier this year, the administration continues to use trade as a tool for diplomatic gains."}],[{"start":113.55000000000001,"text":"Gourinchas acknowledged that the administration’s tariff agenda was yet to escalate into a full-blown trade war. He pinned the lack of retaliation so far on the “very asymmetric” relationship between other countries and the world’s largest economy. "}],[{"start":126.80000000000001,"text":"“Once they develop alternatives, there might be much less of a desire not to retaliate,” he said. “Maybe it leads to less disruption in the first place. But . . . it can lead to escalation. And that’s the worry.” "}],[{"start":139.8,"text":"Gourinchas, who joined the IMF in 2022 from the University of California, Berkeley, said the “main thread” of his time in Washington had been the rise of geopolitical tensions and geoeconomic fragmentation. "}],[{"start":153.35000000000002,"text":"“We are seeing deep challenges to the way the rules of the game are being played,” he said. “When you get disengagement on that scale from one of the main architects, it raises questions about where we go from there.”"}],[{"start":164.20000000000002,"text":"He will return to Berkeley soon after leaving the IMF next week. "}],[{"start":168.25000000000003,"text":"While Gourinchas warned against the risks of fragmentation on global growth, the proliferation of bilateral trade deals that had been inked during Trump’s second term — such as the EU’s deal with several of South America’s largest economies, as well as with India — provided cause for hope."}],[{"start":187.10000000000002,"text":"“As countries integrate more among themselves . . . you start having groups of countries that create their own gravity,” he said. “It’s like forming a new planet — you start attracting others to you and you’re not isolated in the big void.”"}],[{"start":200.55,"text":"The IMF was created just over 80 years ago to help foster — and oversee — globalisation. Gourinchas said that while that era was now in retreat, a drastic slowdown in growth had so far been avoided."}],[{"start":214.5,"text":"While the IMF downgraded its forecasts following the unveiling of Trump’s so-called liberation day tariffs in April 2025, it was far less pessimistic than other forecasters on the impact of the trade policies on growth — notably in the US."}],[{"start":231.35,"text":"The fund’s relative optimism proved well founded. The US economy expanded by a solid 2.1 per cent in 2025 — a slower rate than the 2.8 per cent recorded for 2024, but a far better outcome than many economists had feared."}],[{"start":246.54999999999998,"text":"Gourinchas said one reason his economics team had resisted sharper downgrades was that it was tough to see such a sharp slowdown emerge without a serious financial crisis. "}],[{"start":257.2,"text":"The dollar’s continued status as the world’s pre-eminent currency had been a “source of stability” to markets. Whether that would last would depend on whether the US weaponised its currency."}],[{"start":267.34999999999997,"text":"“The weaponisation is what creates the dynamics to move away from it — to develop your own payment system, your own payment rails, your own infrastructure,” he said. “It’s hard to imagine that we can be a fragmented world on the trade side without [eventually] being fragmented on the financial side.”"}],[{"start":293.1499999999999,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1782541993_6249.mp3"}