After decades of almost uninterrupted growth of trade, tourism and international cooperation, globalization has encountered several obstacles in recent years. After the stagnation of world trade in the wake of the financial crisis of 2007-2008 and, subsequently, under the first Trump administration (2017-2021), when commercial tensions between the United States and China began to emerge, the Covid-19 pandemic caused a strong decrease in international trade, which, measured as a percentage of the world GDP, reached in 2020 its lowest level since 2003.
Although the pandemic served as a reminder of the vulnerabilities of world supply chains, international trade quickly rebounded, and the world trade/GDP ratio reached a maximum of 62.8% in 2022 before falling back to 58.5% in 2023, according to the latest available data of the World Bank.
With the resurgence of geopolitical tensions and the rise of nationalism and protectionism throughout the world in recent years, some of the advances achieved in the past have been left behind. While Trade War 2.0 of the new Presidency of Trump, which has entered a new phase in recent weeks with the two largest economies in the world in direct confrontation (more than 100% of tariffs between the two countries at this time), threatens to put the global economy up, it is very possible that we have assisted the apogee of globalization.
The new tariffs (some temporarily suspended) and, above all, the uncertainty about the future American commercial policy could lead companies to rethink their supply chains to make them less vulnerable to international disturbances. But it is still difficult to predict what lasting impact will have Trump’s current policy on long -term world trade.