If ever there has been a time for a global “reset” button, now would be the time. However, as anyone involved in shipping knows, there is no such thing. Not even a “pause” button, sadly. We can offer you the next best thing, which is an ongoing high level navigation guide to the ever changing circumstances affecting global trade, with a focus on importing and exporting.
At a 30,000 foot view, we see the ongoing crisis in Ukraine causing gas prices to skyrocket and inflation rates to creep upwards as uncertainty continues. Russia’s chokehold on surrounding nations with natural gas and oil is causing ripple effects on the global economy, most certainly affecting prices for shipping anything across any borders. For reference, Russia produces about 11% of the world’s oil. Our BorderBuddy agents are closely monitoring headlines and industry chatter, and are as always, committed to finding you the best routes and methodologies for your importing and exporting, no matter the size of your business.
According to the BBC, oil prices are expected to stay elevated into 2024, which will lead to widespread inflation. Disruptions from the war are expected to have a lasting negative effect, with sanctions on foreign companies and reduced technology creating snarls across the world.
China: lockdowns and uncertainty
Simultaneously, China is in partial lockdown courtesy of its aggressive COVID-Zero policy, which is shaking the already fragile global supply chain. According to economics and trade policy professor, Eswar Prasad of Cornell University and former head of the IMF’s China Division, “The already extensive disruptions to global supply chains are being exacerbated by the lockdowns in China, adding to inflationary pressures and difficulties in procuring a broad range of consumer goods.” The restrictions put into place as part of COVID-Zero amplify ongoing supply disruptions by affecting the country’s industrial production and export activity. Simply put by a top Hauwei executive, China’s COVID-zero policy might trigger “massive losses” and directly impact the global supply chain.
Via Reuters, China’s imports unexpectedly fell in March due to the COVID-19 restrictions across large parts of the country. The lockdowns delayed the arrival of freight shipments while domestic demand shrunk, and overall export growth slowed down. Analysts anticipate a worsening in trade in the second fiscal quarter.
What does this mean to me?
On a macro level, the world is in a state of much upheaval and uncertainty. It’s easy to feel overwhelmed, and we get it. Our BorderBuddy agents are people just like you, witnessing the same disruptions. The difference between our BorderBuddy team and you is that it is our job to consider the impact and implications of all of these factors as we go about ensuring you have the best importing and exporting experiences possible. We are always monitoring borders and are agile in our approaches to finding you the best solutions.
If it means changing how you usually import or export, our agents are there alongside you, discussing and helping determine what makes the most sense for your bottom line. There’s only so much that you can control, and working with BorderBuddy is one of the surest ways to keep your business running smoothly and your communication and insight into your shipments transparent, managed, and streamlined.
Feel like a chat? Give us a ring, we’re a short call away.