2023-11-16 05:30:07
Lhe globalization regularly gives rise to concept words in the language of commerce, English, which are as illuminating on its state as on that of its observers. For some time now, many have been talking about « de-risking »which could be translated as “risk mitigation”.
While alerts linked to geopolitics and climate are increasing on all sides, companies and States are working now to secure sources of supply of raw materials and production chains. The time is no longer really for great decoupling with China, but for « de-risking ». Namely the bypassing of regions potentially sources of insecurity. Which does not necessarily mean leaving, but rather establishing a “plan B”.
This is how companies deploy « China plus one strategy », another concept meaning that they are diversifying or doubling their production chains to reduce their dependence on the Middle Kingdom, which remains the factory of the world. Others focus on the « nearshoring »the repatriation of part of their factories to closer regions, even on the « friendshoring », their installation in a country considered friendly. According to a recent study by the European Central Bank, 42% of multinationals present in Europe are tempted to do so in the medium term.
At the same time, Russia’s invasion of Ukraine and Western sanctions against Moscow have also reshuffled the trade cards on the Old Continent. Since March 2022, direct exports from the European Union to Russia have fallen dramatically. But, in the process, those from Europe to Central Asia have increased, as have trade flows from Central Asia and the Caucasus to Russia, which have more than doubled since 2021, according to the European Bank for reconstruction and development. Re-exports of goods undoubtedly intended to circumvent sanctions.
“New stage”
The latter, like the freezing of assets of the Central Bank of Russia, “mark a new stage in the way politics constrains economic relations”, observes economist Sébastien Jean, associate director of the Geoeconomics and Geofinance initiative of the French Institute of International Relations (IFRI). In a note on the subject, written with Thomas Gomart, the director of IFRI, he explains that States now defend their interests through « weaponization »a word they translate as « arsenalisation »interdependencies, that is to say by exploiting intangible flows, such as financial or information exchanges.
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