There is no doubt that global supply chains, sourcing locations, investment directions and control over transport routes have become key elements of the geopolitical landscape. In this new reality, logistics itself has become an instrument of strategy, with the focus shifting to adaptation, resilience and competitive advantage.
Trade relations and geopolitical blocs
According to the latest update of the McKinsey Global Institute (MGI), trade links are increasingly concentrated among economies with shared geopolitical interests, while ties between rivals are weakening. The most visible factors driving this trend are the strained relations between the US and China and Russia’s invasion of Ukraine.
Between 2017 and 2024, the “average geopolitical distance” in global trade fell by 7%, reflecting a decline in commerce between countries on opposite sides of the geopolitical spectrum. McKinsey’s index is based on UN General Assembly voting patterns, combined with trade intensity, distance and import concentration.
The study also highlights the United States’ gradual decoupling from China. Between 2017 and 2024, China’s share of US trade fell by six percentage points, while imports from Mexico and ASEAN nations rose — enough for Mexico to overtake China as America’s top supplier.
European companies reassess China
In 2024, China and the EU together accounted for 29.6% of global trade and 34.4% of global GDP. Despite this scale, bilateral trade in goods fell by 1.6% year on year to €732.2 billion, while the EU’s trade deficit with China rose to €305.8 billion.
European companies are showing growing caution towards the Chinese market. A 2025 survey by the EU Chamber of Commerce in China and Roland Berger found that 73% of respondents consider the business environment to be worsening — up five percentage points on the previous year.
Only 38% of companies plan to expand operations in China this year, and more than half are cutting costs. Nearly one in five firms no longer lists China among its top ten investment destinations. Many are redirecting funds to Europe, ASEAN or North America, with around 24% choosing to reinvest within Europe itself.
Central and Eastern Europe’s growing logistics role
While large-scale reshoring from Asia remains limited, Central and Eastern Europe has seen strong investment in production and distribution hubs serving European markets. These centres often handle pan-European logistics for fashion, e-commerce and automotive sectors, benefitting local road haulage operators.
Global reconfiguration of supply chains
Data compiled by Transport Intelligence’s Logistics Index for Emerging Markets confirms the ongoing reconfiguration. Among 550 logistics professionals surveyed, more than half said they plan to move part of their production or sourcing outside China by 2030.
Key reasons include trade tensions with the US, rising labour costs, domestic regulations and the need to diversify supply chains. However, China remains strategically important for 68% of respondents, even in the five- to ten-year horizon.
Two main trends are shaping this shift. First, companies are diversifying production sources to reduce risk: 62% have already changed suppliers in the past five years, with nearly half relocating to their home markets or closer to key customers. Second, investment in e-commerce logistics continues to rise, particularly in Asia.
The limits of reshoring
The OECD warns that resilience cannot be achieved through reshoring alone. Supply chains must be designed for uncertainty — agile, scalable and adaptable to changing conditions. Full reshoring could shrink global trade by 18% and real GDP by 5%, without necessarily improving resilience.
Although most trade flows are already diversified, import concentration is still increasing: China’s share of global import concentration rose from 5% to 30% over the past 25 years, while that of the US, Germany and Japan combined fell from 30% to 15%.
Support services such as transport, logistics, postal, distribution and telecommunications play a vital role in resilience. OECD data shows that many European countries perform above average in these areas.
Reshoring challenges in the United States
The US experience illustrates the gap between rhetoric and reality. Research by Kernay shows that America’s Manufacturing Import Ratio rose 9% last year, returning to pre-pandemic levels. As a result, the Reshoring Index plunged from +196 to –115, indicating renewed offshoring.
Nevertheless, optimism is returning: 36% of US CEOs plan to bring some production home within three years, up 15 points from 2024. The main drivers are cost control and geopolitical risk, cited by 65% and 49% of respondents respectively.
