Supply chain disruptions. Geopolitical conflicts. Labor concerns. According to Thomson Reuters Institute’s 2024 Global Trade Report, those are the top three issues keeping global trade professionals up at night.
“Concerns about geopolitical issues — such as conflicts, geopolitically charged export control laws, and retaliatory tariffs — remain as high as ever,” a summary of the report explains. “Also, the growth of trade regulations continues to complicate trade management and compliance. …”
Here, we’ll look at the Thomson Reuters report, evolving global trade dynamics, and how supply chain leaders plan to deal with them.
At the heart of global trade
Noting that supply chains “lie at the heart of global trade businesses,” Thomson Reuters says it’s no surprise that as organizations identify their top challenges and strategic priorities, the supply chain is typically involved.
And to deal with these challenges, they’re increasingly counting on technology to “reduce costs, improve efficiency and risk management, and drive decision-making.”
Key findings of the report include:
- Economic uncertainty: “remains a major concern for international trade professionals. Almost three-quarters (74%) of survey respondents said their businesses were impacted by supply chain due diligence, and more than half (52%) said they were impacted by geopolitically charged export control laws.”
- Labor issues” “ — including labor costs, shortages of skilled labor, and labor laws — was cited as one of the top strategic priorities”
- Top technology investments: include “improving supply chain visibility, security, and data protection”
- ESG focus: “81% of respondents said that environmental, social & governance (ESG) issues are a major consideration in selecting suppliers; and key drivers of decisions to collect supplier ESG data include regulatory requirements, requirements from significant customers, investor pressure, and concerns over reputational risk”
Prioritizing “due diligence”
According to respondents, “supply chain due diligence” is the most pressing “regulatory and customs systems change with the most widespread impact globally.” To deal with it, the companies polled are aiming to improve supply chain visibility and management, and tackle disruption challenges more effectively.
Companies are also prioritizing trade regulations, which “continue to grow in both scale and complexity” — though Thomson Reuters underscored the “significant” regional differences in this context.
“The report found that global trade professionals are employing a number of strategies to address their top concerns, including supply chain diversification and greater use of technology,” the firm said.
For an in-depth discussion about the report — as well as more recent factors influencing global trade — please see a February 23 article on the Thomson Reuters website. It provides a summary of a recent SupplyChainBrain webcast during which Andrew Moxon, Senior Product Marketing Manager at Thomson Reuters, and Marianne Rowden, CEO and Director at E-Merchants Trade Council (EMTC), discussed the report results, evolving global trade dynamics, and strategies companies can take to address them.
Technology to the rescue
In its recently released study, Descartes Systems Group also uncovered a growing reliance on technology as key to fueling growth in the midst of “rising global trade complexities.”
For the study, Descartes and SAPIO Research surveyed 978 supply chain intelligence leaders in “key trading nations” across Europe, North and South America, and Asia-Pacific to:
- Understand the “strategies, tactics and technologies used by companies involved in international trade to help gain a competitive advantage and ensure continued business growth”
- Identify if these “varied by factors such as country, industry, company size and business growth”
Released January 21, the report, What Companies are Doing to Tackle Escalating Global Supply Chain Challenges, revealed that 74% of the supply chain and logistics leaders surveyed view technology as “fundamental or highly important to their organization’s growth strategy in the face of rising global trade challenges, such as tariffs and trade barriers, supply chain disruptions and geopolitical instability.” For companies expecting greater than 15% growth over the next two years, Descartes says this number jumped to 88%. Additionally, 59% “consider technology as extremely or very important to provide a competitive advantage in international trade.”
As far as the specific technology capabilities companies are counting on to boost growth and provide a competitive edge, three topped the list:
- Global trade intelligence — which was cited by 36% of respondents as “the top capability required to deliver the greatest value in the next two years”
- Global trade analytics (27%)
- Supply chain mapping (26%)
Descartes underscores the important role of global trade intelligence, noting that across industries, respondents agreed it was the “top technology capability expected to deliver the greatest value over the next two years,” which was true for the following industry respondents:
- Manufacturing (40%)
- Wholesale and distribution (44%)
- Finance and insurance (38%)
- Retail (30%)
“For companies in diverse industries, global trade has become much more complex, with many new challenges to traditional business operations,” said Jackson Wood, Director, Industry Strategy at Descartes. “As businesses contend with tariffs and trade barriers, geopolitical instability, supply chain disruptions and compliance requirements, technology tools can help them build greater agility and resilience into their supply chains to compete more effectively.”
2025 promises “complex” global trade environment
In a February 28 SupplyChainBrain article, Jackson Wood, director of industry strategy, global trade intelligence for Descartes commented on the report findings — underscoring a “complex environment for cross-border trade in 2025.”
“Under the banner of safeguarding national security interests, protecting strategic local businesses, and advancing foreign policy objectives, tariffs and trade barriers have been on the rise since 2020, especially for high-tech, dual-use, and artificial intelligence technology and the materials and equipment needed to produce them (such as semiconductors),” Wood writes. “As trade tensions intensify, tariffs are poised to surge even higher.”
Wood says supply chain leaders in the study identified “rising tariffs and trade barriers” as their “top challenges” — a concern common among organizations of all sizes, but especially for “fast-growing” companies.
In anticipation of a growing list of tariffs applied to a “wide variety of goods and countries of origin,” Wood says importers in the U.S. are “bracing themselves for the impact” by readying for a potential “significant re-engineering of sourcing strategies” to avoid the financial hit.
Underscoring the urgency to do so, Wood notes that China has already issued new trade controls over several major U.S. companies, has a growing export control list, and indicates a willingness to “retaliate against the U.S. with its own sanctions.”
Plus, since it has a track record of doing so, Wood says that in the “impending trade war” China will likely use non-tariff barriers — like “administrative hurdles, inspections and quotas” — to create supply chain disruptions.
“Non-tariff barriers were responsible for 50% of the overall reduction in China’s imports from the U.S. during the height of the U.S.-China trade conflict in 2018 and 2019,” he writes.
Wood also notes that business leaders still haunted by the supply chain chaos of the pandemic are worried about potentially new disruptions resulting from “geopolitical conflict, natural disasters and more complex compliance regulations.”
After providing further details about those challenges, he says many companies are turning to technology to help tackle them.
“Companies are drawing on trade and intelligence tools and strategies to support sustainable growth and mitigate the shockwaves from supply chain disruptions,” Wood writes. “As a result, they’re able to keep pace with tariff updates, stay apprised of trade and other compliance regulations, quickly identify trouble spots in their supply chains, and formulate timely risk-mitigation plans.”
