Amid supply chain issues and inflated shipping costs, global trade continued to grow last year, reaching around $28 trillion in 2021. 23% increase over the previous year.
Which countries are the central nodes of the global trade network? Although China is currently the world’s largest trading partner, this has not always been the case.
This series of graphs of Anders Sundell depicts the history of the world’s largest shopping malls, showing how the landscape has evolved since 1960. Using netgraphs, each visual connects countries to their main trading partner, using data that includes both imports and exports.
1960: A period of American commercial dominance
International trade has existed for millennia and was previously done through famous trade routes like the Silk Road, which carried luxury goods from China to Europe from the first century Before our era.
However, our story begins in the 1960s, just before containerization spread from the United States around the world, forever transforming global trade.
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In the 1960s, the United States was experiencing its post-war economic boom. Consumer spending was driving rapid economic growth, and a burgeoning middle class was driving increased demand for luxuries like televisions and cars. In response to this growing demand, American factories that had been essential to the war effort quickly moved in, and domestic production began to flourish.
Around the same time, legislation encouraging international trade was passed by Congress. In 1962, President John F. Kennedy signed the Trade Expansion Act into law, allowing the U.S. government to negotiate massive tariff reductions with other countries. This eventually led to the Kennedy Round two years later, which was a series of trade negotiations that resulted in lower tariffs and lower export barriers for developing countries.
Across the pond, Europe was going through its own set of changes in the 1960s. While Britain was the most important trading player in Europe at the time, the country also had to struggling to recover from the financial burden of the two world wars.
Simultaneously, European countries were also banding together in an attempt to balance power and eliminate hegemony within Europe. In 1960, the European Free Trade Association (EFTA) was created, creating free trade agreements between Austria, Denmark, Norway, Portugal, Sweden, Switzerland and the United Kingdom.
1990: The rise of China
In 1990, the global international trade landscape was about to change dramatically.
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To begin with, Britain’s global commercial dominance had diminished further, and a new Germany got up to take over. The German automobile industry began to develop rapidly at this time. In 1990, Germany exported 2.6 million cars worldwide, less than Japan shipped that year, but still enough to make Germany one of the most important commercial hubs in the world. ‘era.
1990 was also around the same time as China was beginning to emerge as a world leader. The country’s economy had grown in strength over the previous decade, thanks to a series of reforms introduced by the then leader, Deng Xiaoping, which were created to encourage foreign investment and boost trade. international trade.
This new focus on economic growth in China has spurred the rapid expansion of free trade zones in the country, which have granted certain regions special freedoms on importing and exporting goods.
Throughout the 1990s, China’s economic prosperity continued and its role in international trade became increasingly important. Finally, at the end of the decade, China became a member of the world trade organizationgiving the country an unprecedented opportunity to further establish itself as a major global trading partner.
2020: a new world order
By 2020, China had overtaken the United States as the world’s largest trading partner. But as the country’s influence grew, so did tensions between the United States and China.
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In 2018, the Trump administration set tariffs on more than $360 billion in goods, with the aim of encouraging Americans to buy domestic products. In response, China set its own tariffs on more than $110 billion value of US assets.
The conflict is still ongoing, and so far there is no clear winner in sight. Tariffs and trade barriers have hurt both countries, and with bilateral trade sluggish, many are wondering if the peak of globalization is behind us.