Trends in Global Trade Amid Rising Economic Fragmentation

June 2024

The briefing explores trends in the global structure amid rising economic and geopolitical uncertainty. As global economy evolves, countries and companies will need to find ways to diversify the supply of critical components. This will require establishing new trade routes and striking the right balance between operational security and cost efficiency.

USD 1,475
Request More Information


This report comes in PPT.

Key Findings

Global trade declines amid higher global uncertainty

Global trade value has declined in 2023, with exports and imports down 2% and 3%, respectively. Slower global economic growth and higher uncertainty, as well as persistent geopolitical pressures contributed to the stalling trade.

Market supply of most critical components remains tight

Market supply of the most critical B2B components and manufactured goods, such as electronic components, mobile phones and transport equipment, remains concentrated. Production and exports are in large part dominated by China and other Asian countries, especially in the electronics sector.

Countries accelerate production and trade diversification

Following supply chain disruptions back in 2020 and persistent geopolitical tensions, the largest economies are accelerating efforts to diversify production and trade structure of the most critical components. New emerging hubs, such as India, Vietnam and Mexico, are supporting the efforts.

India has strong exports potential, but remains reliant on China

India has strong potential to develop as global manufacturing and exports hub. However, the country remains heavily reliant on component imports from China, in turn hindering global diversification efforts. Development of supporting industries will be required to unlock India’s potential.

China will continue to play a critical role in global supply chains

New manufacturing and trade hubs can help to diversify global trade structure; however, China will continue to play a critical role in global supply chains due to large manufacturing capacity and ability to supply critical components. China’s dominance remains especially evident in the hi-tech goods sector.

Why read this report?
Key findings
Global trade declined in 2023 amid slower economic growth and rising geopolitical tensions
China-US trade value declines as economic diversification efforts intensity
Rising geopolitical tensions is the largest risk to the global trade over the medium term
Market supply of the most critical electronic components remains dominated by China
Electronic components: China dominates global trade, but diversification efforts accelerate
Batteries: China continues to strengthen its position in the global market
Mobile phones: China remains the key supplier, but other countries are catching up
Computers: China maintains the lead, but trade is becoming more diversified
Automotive: Trade remains diversified, future competition from China anticipated
Aerospace: Market supply remains dominated by developed economies
High reliance on China sparks production and supply diversification efforts
USA: Enhanced trade with Mexico and ASEAN to reduce economic reliance on China
China: Diversified trade structure and strengthened position in ASEAN countries
Japan: Diversification sets to accelerate as dependence on China grows
Germany: The risk of a growing trade imbalance with China
India: Potential to emerge as a trade hub, but currently highly reliant on Chinese supply
Trade diversification is under way, but more homework needs to be done
New trade hubs in Asia and Europe emerge as supply chains become more diversified
Case study: Apple expands production in Vietnam amid diversification efforts
New trade hubs boost exports to the USA, EU, but remain reliant on China for components
More investments in new manufacturing hubs are needed to fully replace China
Case study: Hutchison Ports to boost trade capacity in Mexico
Case study: Ionway investment strengthens Poland’s role in Europe’s battery supply chain
Global trade diversification: Opportunities for growth
Evolution of global trade flows
Questions we are asking
What this briefing covers


If you purchase a report that is updated in the next 60 days, we will send you the new edition and data extraction Free!