Aggressive reshoring of supply chains risks significant GDP loss, warns OECD

The OECD warns that advanced economies could face significant GDP losses if they rapidly localize supply chains due to rising geopolitical tensions, particularly between the US and China. Their model suggests an 18% decrease in global trade and GDP losses of up to 12% for some countries if they abandon globalization. The report emphasizes that over-dependence on a single trade partner, like China, could lead to vulnerabilities, urging nations to maintain openness and geographical diversification for greater resilience against economic shocks.