In an interview with Firstpost, Luisa Antonia Rodriguez Ortega, Economic Affairs Officer in the Trade Logistics Branch at UN Trade and Development (Unctad), discusses how geopolitical tensions are reshaping maritime corridors, driving up costs and exposing vulnerabilities in global supply chains.
Geopolitical tensions are disrupting maritime trade, with consequences extending to everyday life — from rising oil prices to concerns over the safety of seafarers. From the Red Sea to the Black Sea, instability along crucial shipping routes is creating fresh challenges for the global economy.
In an interview with Firstpost, Luisa Antonia Rodriguez Ortega, Economic Affairs Officer in the Trade Logistics Branch at UN Trade and Development (Unctad), discusses how geopolitical tensions are reshaping maritime corridors, driving up costs and exposing vulnerabilities in global supply chains. She also explains how countries can build resilience and why India is well positioned to benefit from shifts in global trade patterns.
Rodriguez has worked at Unctad for 17 years, including nine years in trade logistics. She contributes to the organisation’s annual Review of Maritime Transport and works on transport networks and corridors, ports, trade facilitation, sustainable transport and maritime transport statistics.
Edited excerpts:
How much more expensive and unpredictable has moving goods around the world become because of geopolitical tensions?
Geopolitical tensions have had a significant impact on prices, particularly freight rates. At certain points during these crises, freight rates have almost tripled. This has a particularly severe impact on developing countries, which tend to be less connected to maritime transport networks.
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As a result, shipping services become more expensive, which ultimately affects the prices consumers pay.
We have modelled these effects over the past three years, during which several crises have unfolded. But the impact is not limited to consumers. There is also a crisis for producers, particularly in middle-income developing countries that manufacture intermediate goods.
These producers face higher costs when importing the inputs they need to manufacture and export their products. This, in turn, reduces their competitiveness in international markets.
Global trade routes are being repeatedly disrupted, from the Red Sea to the Black Sea and the Panama Canal. Are we entering an era in which supply-chain disruption is becoming the norm rather than the exception?
Yes, absolutely. This pattern did not begin only in the past two years. Since the Covid-19 pandemic, we have seen recurring disruptions that require trade flows to be reconfigured.
Our analysis of maritime transport and trade flows shows that almost every year, a new issue emerges and forces changes in how goods move around the world. Energy trade offers a clear example.
Following the conflict between Russia and Ukraine, some trade flows that once moved from Russia to Europe were redirected to Asia. Significant volumes of Russian crude oil have also come to India for refining.
At the global level, these changes have created inefficiencies. Supply chains have become more fragmented, transport distances have increased and networks of suppliers have become more complex. All of this adds to costs.
So, to return to your question, disruption has become the norm. How do we deal with it?
These are global events, and we cannot prevent every crisis. However, there is considerable scope for action when it comes to building resilience and strengthening our capacity to respond.
Countries can cooperate at the regional level, particularly on strategic commodities. They can also rethink and improve processes at borders and ports to reduce delays, shorten transit times and help goods reach markets more quickly despite disruptions.
The Red Sea crisis has forced ships to take much longer routes around Africa. What has this taught us about the vulnerability of global trade to a handful of maritime chokepoints?
The key lesson from the current situation is that trade flows have continued. Maritime trade has proved resilient, which is encouraging.
However, we need to look beyond this observed resilience. Ships may simply take alternative routes, but those routes are more expensive. We need to understand what these additional costs mean for individual countries and identify alternatives that allow trade networks to respond more flexibly to crises.
That is where policy attention needs to be focused, and it is also an important part of the work we are doing with countries.
*From Unctad’s perspective, how important is India’s ability to integrate its ports with efficient rail and road networks in determining whether it can capture a larger share of global supply chains?*
We have seen significant changes in India’s maritime connectivity. Unctad maintains statistics on maritime trade and connectivity, and over the past five years or so, we have seen a remarkable increase in the connectivity of Indian ports.
This reflects the high priority India has given to maritime infrastructure, supported by sustained investment. From that perspective, India can play an important role.
Asia is central to global maritime transport and seaborne trade. With further port development and the creation of corridors connected to these ports, India is well positioned to benefit from the current changes and reforms in global trade.
Could artificial intelligence significantly change customs and logistics — for example, by predicting congestion, identifying risks or optimising cargo movement?
Technology has a very important role to play in creating an agile environment that allows countries and businesses to respond quickly to disruptions.
There are multiple sources of information, including automatic identification system (AIS) data and statistics. By leveraging these sources, it becomes possible to assess how to respond when a disruption occurs and whether an impending disruption can be anticipated.
Technology can therefore play an important role in improving preparedness and enabling faster responses.
*What are the most common reasons why international trade corridors fail to deliver the efficiencies promised when they are first announced?*
We need to take a comprehensive view of trade corridors. Building infrastructure alone is not enough; we must also understand the trade that will move through the corridor.
That means analysing trade flows and ensuring that a corridor meets a genuine need by connecting consumers, producers and centres of processing and value addition. These connections are what generate economic benefits.
The second important factor is the institutional framework and governance needed to develop a corridor successfully.
At one level, there must be a clear vision, with an entity or leadership structure responsible for setting that direction. At another, there must be a system for monitoring progress against defined objectives. If the goal is to increase trade or investment, for example, there must be a way to assess whether those targets are being met.
Third, corridor governance cannot be limited to discussions between governments. Civil society, academia and the private sector must also be involved, as they play important roles in ensuring that corridors serve their intended purpose.
These three levels of governance are critical to a corridor’s success.
How do we navigate these challenges when multinational groups of countries have their own strategic interests and political frameworks? How can they be brought under a common regulatory umbrella?
A high-level coordinating body is important. Take the Trans-Saharan Corridor, for example, which we work on. The participating countries signed a memorandum of understanding that established the political will to move towards a shared goal.
That commitment must then be translated into specific areas of work. Different countries naturally have different regulations, so they need to find ways to work together in developing the corridor.
I would not necessarily describe this as harmonisation. It is more about understanding how countries can move forward together and adopt a common approach.
For that, there needs to be a forum where countries can discuss their differences, reach agreement and coordinate their efforts.