What goes around, comes around

June 18, 2021. – World trade is 500 years old. In the early days, luxury products like spices, furs and tea were exciting and in demand. Trading was good business and merchants got wealthy. Soon someone invented customs duties as a good way to collect money for the state. A bit later the nation states noticed that trading on a larger area increased economic activity. The trade zones started to evolve.

The industrial revolution in the 19th century kicked-off bulk shipping. Raw materials begin to travel from country to country. The Suez Canal was opened in 1869. Railways connected mining areas and cities. World market united and international competition arose. Custom duties were a protection tool to get national industries on their feet.

When looking back, the balancing between free and restricted trade has existed from the beginning. Free trade zones expand and shrink together with some countries joining, some leaving. Trade relationships get warm before they get colder again. Trade barriers are removed, and they are brought back. Balancing continues.

Trade barriers are complex issues. National decisions can impact businesses on every continent. In most cases, private companies have no other choice than to adapt to the situation. As world trade is a tight-knit system, it is worth following what is happening around us.