Against today’s geopolitical backdrop, global trade flows are shifting. In just the past three years, adjustments in trade corridors have reshaped industries, note senior partner Cindy Levy and colleagues. In particular, trade routes to the United States from China and from Mexico experienced notable changes from 2021 to 2023. Business leaders will need to assess what growth looks like for them—and may find opportunities from new tariffs or trade agreements to attract more market share—as geopolitical conditions continue to change.
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Ten pairs of bar graphs show the shifts in the value of trade in different global trade corridors between 2021 and 2023 in billions of dollars. The shifts shown are as follows:
- China to US: Trade fell from ~$580 billion to ~$510 billion, a CAGR of –6.3%.
- Mexico to US: Trade rose from ~$400 billion to ~$490 billion, a CAGR of +10.8%.
- Canada to US: Trade rose from ~$380 billion to ~$440 billion, a CAGR of +7.7%.
- US to Canada: Trade rose from ~$310 billion to ~$350 billion, a CAGR of +6.7%.
- US to Mexico: Trade rose from ~$275 billion to ~$325 billion, a CAGR of +8.0%.
- China to Hong Kong (Special Administrative Region): Trade fell from ~$350 billion to ~$280 billion, a CAGR of –11.0%.
- Germany to US: Trade rose from ~$145 billion to ~$170 billion, a CAGR of +8.6%.
- China to Japan: Trade fell from ~$165 billion to ~$160 billion, a CAGR of –2.4%.
- China to South Korea: Trade remained consistent at ~$150 billion, a CAGR of 0.0%.
- US to China: Trade fell from ~$150 billion to ~$148 billion, a CAGR of –1.0%.
Source: McKinsey analysis, using International Monetary Fund Direction of Trade Statistics data.
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To read the article, see “A proactive approach to navigating geopolitics is essential to thrive,” November 12, 2024.