The big re-shoring puzzle

The big re-shoring puzzle

Since 2020, governments across the US, Europe and the UK have promoted re-shoring, near-shoring and friend-shoring as ways to strengthen supply chains, create jobs and reduce strategic dependence on China.   But how much of this shift is genuinely bringing industry home, and how much is simply reorganising global trade?   In this episode of Trade Links, Tim Phillips is joined by Aastha Gupta and Scott Livingstone to separate the headlines from the underlying data.   In this episode:   Is re-shoring really happening?   Aastha explains how industrial policies such as the US CHIPS Act and Inflation Reduction Act have channelled hundreds of billions of dollars into semiconductors, electric vehicles and clean technology.   However, the evidence suggests that the re-shoring story is more complicated than political messaging implies:   * Many supply chains remain heavily dependent on imported components. * Production is often being rerouted through intermediary countries such as Vietnam and Mexico rather than returning home. * New investment frequently represents additional capacity rather than relocation of existing manufacturing. * Foreign firms are increasingly establishing local operations in Europe and North America.   The result is less a wholesale return of manufacturing and more a gradual reconfiguration of global supply chains.   The jobs question   Large investment announcements often promise tens of thousands of jobs, but the panel highlights an important distinction between construction employment and long-term operational jobs.   Capital-intensive sectors such as semiconductor fabrication, battery production and clean technology require enormous upfront investment but relatively modest permanent workforces.   The discussion asks whether today’s industrial policy is delivering broad-based reindustrialisation or simply targeted support for strategically important sectors.   Friend-shoring: Trading with trusted partners   Scott explores the rise of friend-shoring, where countries prioritise reliability, integrity and political dependability over lowest-cost suppliers.   Examples include:   * US–Vietnam trade ties * Europe’s engagement with Saudi Arabia * UK partnerships focused on critical minerals   The conversation examines how governments increasingly define “friends” through commercial resilience and strategic interests rather than shared political systems.   The costs of resilience   Re-shoring and friend-shoring may strengthen supply security, but they also come with trade-offs.   Economic costs include:   * Higher production costs * Significant public subsidies * Potential inflationary pressures * Reduced efficiency from fragmented supply chains   Political challenges include:   * Greater fragmentation of the global trading system * Managing increasingly transactional international relationships * Questions over credibility when values-based foreign policy collides with commercial interests   US–China relations: Spin versus substance   The panel also revisits recent US–China engagement following President Trump’s visit to Beijing and ahead of a planned follow-up meeting in September.   Key questions include:   * Was the visit a diplomatic success for both sides? * Did any meaningful structural agreements emerge? * Could September bring progress on tariffs, rare earths or technology controls?   The panel concludes that recent engagement has largely focused on stabilising tensions rather than resolving fundamental disputes.   What to watch   Aastha’s radar: The growing use of “shadow fleets” transporting sanctioned oil from Russia and Iran is creating an increasingly opaque parallel trading system, raising questions about sanctions effectiveness and transparency in global commerce.   Scott’s radar: Military exercises around Taiwan and in the Baltic Sea this summer warrant close attention. Demonstrations of capability by Taiwan, China, NATO and Russia all carry the risk of misinterpretation and unintended escalation.   Speakers   Host: Tim Phillips Guests: Aastha Gupta (European Economist) Scott Livingstone (International Advisor)   Subscribe, leave a review, and join us for future episodes as we continue to unpack the world’s evolving trade landscape.   All details correct at time of recording.   For any terms used please refer to this glossary https://www.natwest.com/corporates/insights/markets/glossary.html Please view our full disclaimer here: https://www.natwest.com/corporates/disclaimer.html   Subtitles automatically generated.   Please check out and subscribe to our channels on Apple and Spotify.   This episode was recorded on 17 June 2026. All details correct at time of recording. For any terms used please refer to this glossary https://www.natwest.com/corporates/insights/markets/glossary.html Please view our full disclaimer here: https://www.natwest.com/corporates/disclaimer.html

Brexit: 10 years on, what next for the UK-EU relationship?

In this episode of Trade Links, host Tim Phillips is joined by Aastha Gupta and Scott Livingstone to revisit two major trade stories shaping the global economy: 10 years on from Brexit, and one year after the US “Liberation Day” tariff announcements. The discussion explores how trade relationships have evolved, where economic frictions remain, and why geopolitics is increasingly influencing global commerce.  BREXIT – TEN YEARS ON 1. UK–EU trade has stabilised, but at a lower level * UK goods trade with the EU remains around 10–15% below its pre-Brexit trajectory in volume terms, even though trade values have recovered due to inflation and higher prices. * Manufacturing sectors including automotive and chemicals continue to struggle, while food and agriculture recovered after an early shock but remain more volatile. * UK services exports have stayed resilient overall, largely thanks to growth in non-EU markets such as the US, masking weaker EU performance. 2. Non-tariff barriers remain the biggest drag on trade * Although Brexit avoided tariffs, businesses continue to face customs paperwork, rules-of-origin requirements, and border checks. * These non-tariff barriers are estimated to create costs equivalent to 7–10% tariffs on goods trade. * Smaller exporters have been disproportionately affected, with some firms deciding exporting to the EU is no longer commercially worthwhile. 3. Political and economic pressures are encouraging closer alignment * The UK and EU are increasingly pursuing pragmatic cooperation in areas such as energy, customs data sharing, food standards, and youth mobility. * Sectors including agri-food, pharmaceuticals, chemicals, and electric vehicles could benefit significantly from regulatory alignment. * Broader geopolitical pressures — including Russia’s aggression and uncertainty around US policy toward Europe — are creating incentives for deeper UK–EU cooperation without full reintegration. ONE YEAR AFTER US “LIBERATION DAY” TARIFFS 1. The tariffs were dramatic politically, but economically less effective * US headline tariff rates jumped from roughly 2.5% to over 20%, levels not seen for more than a century. * In practice, exemptions, carve-outs, and negotiations reduced the effective tariff burden closer to around 10%. * Despite the scale of the announcements, the US goods trade deficit widened rather than narrowed over the following year. 2. Tariffs changed behaviour more than outcomes * Companies accelerated imports ahead of tariff implementation before reducing volumes once measures took effect. * Firms adapted supply chains through rerouting, exemptions, and alternative sourcing strategies. * Businesses increasingly shifted from “just-in-time” supply chains to “just-in-case” inventory models, embedding higher costs into global trade. 3. Trade has become a geopolitical weapon * Countries responded with bilateral negotiations, retaliatory tariffs, supply-chain diversification, and efforts to avoid provoking Washington. * China’s restrictions on rare earth exports highlighted the strategic importance of trade choke points and critical supply chains. * The panel argues that the world is entering a more fragmented era of globalisation, where resilience and geopolitical alignment increasingly matter more than pure economic efficiency. All details correct at time of recording. For any terms used please refer to this glossary https://www.natwest.com/corporates/insights/markets/glossary.html Please view our full disclaimer here: https://www.natwest.com/corporates/disclaimer.html

The Iran war: what will peace look like?

In this episode of Trade Links, Tim Phillips is joined again by Aastha Gupta and Scott Livingstone to explore an unprecedented scenario in global trade: what happens when both the Strait of Hormuz and the Red Sea are compromised at the same time? With escalating tensions in the Middle East and warnings from the Houthi movement, the team considers the far-reaching consequences for energy, food security and global supply chains.   They also talk about Donald Trump’s delayed China trip, and how energy security and supply chain resilience will likely overshadow traditional trade topics like tariffs and soybeans. Lastly, they ask the dreaded question: What’s on the Trade Links radar? Clue: fertiliser shortages impacting Brazil and India, potential pressure on Cuba from the US, and rising tensions between Pakistan and Afghanistan.   All details correct at time of recording.   For any terms used please refer to this glossary https://www.natwest.com/corporates/insights/markets/glossary.html Please view our full disclaimer here: https://www.natwest.com/corporates/disclaimer.html   This episode was recorded on 19 March 2026.   All details correct at time of recording. For any terms used please refer to this glossary https://www.natwest.com/corporates/insights/markets/glossary.html Please view our full disclaimer here: https://www.natwest.com/corporates/disclaimer.html

India's trade deal blitz and the future of the WTO

In this episode of Trade Links, Tim Phillips is joined by Aastha Gupta and Scott Livingstone to unpack the political and economic forces shaping global trade deals and the evolving role of the World Trade Organization (WTO). Key Topics: * India’s Trade Deal Blitz: Comparing India’s agreements with the EU, UK, and US – from comprehensive free trade deals to targeted strategic partnerships. * Politics vs. Economics: How deals are increasingly shaped by geopolitics, including the impact of US tariffs and India’s Russian oil imports. * WTO at a Crossroads: Assessing the organisation’s diminished influence, its historical contribution to global trade, and what a “minimum viable” WTO could look like in a fragmented trade landscape. * The Rise of Trade Clubs: Emergence of mini-lateral agreements and managed trade arrangements replacing the old multi-lateral structure. * What’s Next: Integration opportunities for India, supply chain diversification for Western economies, and the potential shift in defence and geopolitical alignments. All details correct at time of recording. For any terms used please refer to this glossary https://www.natwest.com/corporates/insights/markets/glossary.html Please view our full disclaimer here: https://www.natwest.com/corporates/disclaimer.html

Coercion, control and the Trade Links curse

As Trade Links returns in 2026, host Tim Phillips is joined by our regular panel of experts, Aastha Gupta (European Economist, Economics and Market Strategy) and Scott Livingstone (International Advisor) to talk trade and the international backdrop.  It’s been a dramatic start to the year, so naturally the discussion focuses on US intervention in Venezuela and that most perennial of trade topics… oil. What are the impacts on the region immediately, and longer term? The discussion then turns towards sanctions, and their efficacy in a highly interconnected world – looking at Russia, Iran and South Africa as examples. Can supply chains become sanction proof? Lastly, the panel shares developments that the world may have overlooked, at the time of recording. Since then, of course, everything might have changed.   Please check out and subscribe to our channels on Apple [https://podcasts.apple.com/id/podcast/natwest-trade-links/id1819914204] and Spotify [https://open.spotify.com/show/22tvckJbiWWRbqcCnyFsIC]. This episode was recorded on 22 January 2026. President Trump quoted from press conference: https://www.youtube.com/watch?v=GPpd8AJwGlY All details correct at time of recording. For any terms used please refer to this glossary https://www.natwest.com/corporates/insights/markets/glossary.html Please view our full disclaimer here: https://www.natwest.com/corporates/disclaimer.html