Geoeconomics

Geoeconomics

Under this moniker we have grouped the issues associated with the at times uneasy interplay between national economic interests and wider geopolitical considerations. The EU’s unhealthy dependence on Russian energy is a case in point, as well as the highly controversial Nord Stream 2 pipeline, which took a war to get cancelled. By examining economic tools and resources, such as trade, investment, sanctions, and technological developments, Geoeconomics sheds light on how states leverage their economic strength to shape global dynamics and achieve geopolitical objectives—and how this can clash with the common EU interests.

Related articles

Strategic Raw Materials in Ukraine: Opportunities for Strengthening EU Supply Chains?

Isabella Gourevich

This Policy Brief identifies raw materials which Ukraine has reserves for and examines Ukraine’s current role in raw material production and trade. It evaluates current global supply chains as well as EU and German sourcing patterns. A special focus will be on raw materials which are classified as strategic raw materials by the EU and which Ukraine has put an emphasis on in its activities on attracting investors.

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US “Reciprocal” Tariffs and the Erosion of Global Trade Rules: Implications for Germany

Lisandra Flach and Lisa Scheckenhofer

With his so-called “Liberation Day” on April 2, 2025, US President Donald Trump proposed implementing “reciprocal tariffs”, under which the US would raise import tariffs to match those imposed by its trading partners, further undermining the multilateral rules-based system. This policy brief examines the status quo of tariff differentials between the US and the EU and explores the implications of this policy for the German economy should it be implemented.

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The Effect of Trump Tariffs on Mexico and Canada

Andreas Baur and Lisandra Flach

US President Donald Trump’s 25% tariffs on imports from Canada and Mexico would trigger a sharp decline in exports across all three economies. If retaliatory tariffs are imposed, Canada’s exports could shrink by 28%, Mexico’s by over 35%, and the U.S.’s by 22%, reflecting the deep integration of the countries’ trade flows. Mexico’s and Canada’s manufacturing sectors would suffer the most, with value-added losses of 13% and 14%, respectively. In the U.S., the agricultural sector would take the biggest hit, facing a 2.4% drop in value added. 

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Complexities and Dependencies in the Global Semiconductor Value Chain

Dorothee Hillrichs und Anita Wölfl

This EconPol Report sheds light on the global supply of semiconductors. The analysis of value-added data for the US underscores the importance of semiconductors for advanced economies. Using global trade data and an extensive list of semiconductor-related goods, the authors provide a detailed description of the global semiconductor economy. While final chip exports have been dominated by Taiwan, China, and Korea at an aggregate level since the early 2010s, export leadership varies substantially across chip types. Moreover, the authors identify nine core countries in North America, Europe, and Asia that dominate semiconductor-related trade including material inputs and equipment. The nine countries exhibit substantial mutual trade dependencies due to the fragmentation of semiconductor production

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Ukraine Refugees: From Temporary Protection to Encouraging Return to Support the Ukrainian Economy

ECONOMIC POLICY AND ITS IMPACT

Yuriy Gorodnichenko and Daniel Gros

With the war now one of attrition, the Ukrainian economy needs to be strengthened. To this end, a package of measures is needed to incentivize the return of Ukrainian refugees and help businesses invest in Ukraine to create the jobs needed by returning refugees.

 

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