Everyone has been talking about tariffs, but the larger issue is how trade flows will change over the next decade. Follow the trade flows and you will be following the geopolitics of nations. We are not living in a mercantilist world, yet the dynamics of trade will influence the relationships of nations. BCG has done a good job of describing this issue with their white paper "Great Powers, Geopolitics, and the Future of Trade".
The BCG report does a good job of describing and putting numbers to the key trade drivers that will drive geopolitical issues over the next ten years. We will see the forming of stronghold North America which will isolate itself from the rest of the world through tariffs. Second, we will see a continuation of the great China pivot away from the US. This will be matched by the rise of the global south, the ASEAN growth transition and the ascent of India trade. Finally, there will a new focus on EU competitiveness to offset the losses from trade with Russia and China.
These changes will have an impact on commodity flows as well as finished goods. We should also see these changes impact capital and equity flows.
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