SEOGWIPO, South Korea — The Asia-Pacific Economic Cooperation (APEC) forum sounded the alarm on Thursday (May 15), projecting near-zero export growth for the region this year amid escalating U.S. tariffs. The grim forecast came as top U.S. and Chinese trade officials held closed-door discussions during the gathering.

In its newly released regional trends analysis report, the 21-member economic bloc slashed its 2026 export growth projection to a mere 0.4% - a dramatic plunge from last year's 5.7% expansion. The figures were unveiled during APEC's Trade Ministers' meeting on South Korea's picturesque Jeju Island.

The organization simultaneously downgraded its regional GDP growth outlook from 3.3% to 2.6%, citing weakening global demand and mounting trade uncertainties.

"Trade growth is set to decline sharply across APEC due to lower external demand, particularly in manufacturing and consumer goods," warned an official statement that highlighted how rising protectionist measures are now impacting service sectors as well.

The Tariff Transformation

The report underscores how dramatically trade dynamics have shifted since APEC's founding in 1989, when average regional tariffs stood at 17%. Through decades of economic integration, rates had fallen to just 5.3% by 2021 - fueling a nine-fold explosion in merchandise trade that now faces reversal under new U.S.-led tariff regimes affecting over half of APEC members.

Diplomatic Maneuvers Behind Closed Doors

Amidst the concerning forecasts emerged signs of potential diplomatic progress: