The global economy's Achilles' heels
Summary
Global trade relies on concentrated supply chains and key shipping routes, leaving some goods exposed to disruptions from geopolitical tensions and other shocks. The share of global imports facing at least two major supply-chain vulnerabilities rose from 15% in 2000 to 23% in 2024, as companies and governments look for ways to reduce those risks.Key Facts
- McKinsey researchers identified several dozen global maritime chokepoints through which 80% of maritime trade passes.
- The share of global imports facing at least two of three major vulnerabilities increased to 23% in 2024, from 15% in 2000.
- The vulnerabilities include reliance on critical inputs, concentrated suppliers and geopolitical strain.
- Goods with overlapping vulnerabilities include iron ore, lithium-ion batteries, smartphones and memory chips.
- Moving final assembly to a different country may not remove exposure if upstream suppliers remain vulnerable.
- Global integration and specialization have increased supplier concentration in some parts of the economy.
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