Shifting Forces of Trade – What Does Geopolitical Reordering Mean for Finland?

Maria Wang

No 167, ETLA Brief from The Research Institute of the Finnish Economy

Abstract: Abstract The gravity model is one of the most widely used tools in international economics, explaining trade between countries through their mutual “attraction”, determined by economic size and geographical distance. In an era defined by geopolitical tensions, the pandemic, and disruptions to supply chains, the gravity model helps reveal how global trade is fragmenting and reorienting toward regional blocs. From Finland’s perspective, the model provides a valuable means of evaluating trade vulnerability and adaptive capacity: roughly one quarter of Finland’s intermediate goods imports depend on countries whose supply reliability is geopolitically uncertain. This perspective is crucial for understanding how Finland can strengthen its trade resilience and strategic autonomy in a rapidly changing global economy.

Keywords: Geoeconomics; Industrial policy; Trade policy; National security (search for similar items in EconPapers)
JEL-codes: F13 F52 O25 (search for similar items in EconPapers)
Pages: 10 pages
Date: 2025-11-12
New Economics Papers: this item is included in nep-mac
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