Since early 2022, geopolitical blocks have done significantly less business together.
Statista's Katharina B. Buchholz has the latest.
A release from the World Trade Organization shows both
Trade between and within blocs
Trade has been hampered by sanctions and blockades imposed in the wake of the Russian invasion.
Take January 2022 for a starting point in the calculation of an index.
World Trade Report 2023
Global trade between geopolitical blocks, for instance, reveals this.
Between the beginning and the end last year, the distance between Western bloc countries, such as Americas, Europe, and China, Russia, and Saudi Arabia and Eastern bloc nations, like China, Russia, and Saudi Arabia has decreased by over 10 percent.
Around the time of the invasion, in late February 2022, the trade within the blocs was at almost 109 points and then dropped to 100 points by December.
More infographics can be found at
The West bloc countries' refusal to buy Russian oil after the Ukraine war has contributed to this effect.
India and China increased purchases as the price of the commodity increased, while Russia was eager for its sanctions-related excess stockpiles to be sold, changing global trade patterns. The report states that
U.S.-China Trade Tensions
Even earlier, the United States had begun to alter these patterns when it sought to increase its trade with other countries.
Near-shoring is a good way to diversify. In this context, it's better to call it friend-shoring. This means sourcing and trading from countries that are thought to be part of the same geopolitical unit.
WTO authors claim that despite the advantages of economies of scale - lower prices - a concentrated global production, outside certain geopolitical blocks, poses inherent risks during crisis situations.
Diversification of sourcing is a positive thing, given the current global turmoil. It has helped to fill in trade gaps. However, a bloc-minded mindset will hurt global trade and economic progress over time.
Another WTO report
Early this year, we warned of the dangers.
Costs associated with leaving multilateral trade. This cost is estimated at 8,7 percent of global real income and up to 11,3 percent in the least developed countries.