Explore Your Possibilities: Shipping Costs Start to Crimp Globalization

Mendeleev was one of the founders, in 1869, of the Russian Chemical Society. He worked on the theory and practice of protectionist trade and on agriculture.
...the collapse of world trade talks in Geneva last week also signal that ...
India and China a on opposite position with USA, talking about their own food products market.
"the Canadian investment bank CIBC World Markets, calculates that the recent surge in shipping costs is on average the equivalent of a 9 percent tariff on trade. “The cost of moving goods, not the cost of tariffs, is the largest barrier to global trade today,” the report concluded, and as a result “has effectively offset all the trade liberalization efforts of the last three decades.”"
Last week, efforts to complete what is known as the Doha round of trade talks collapsed in acrimony, dealing a serious blow to tariff reduction. The negotiations, begun in 2001, failed after China and India battled the United States over agricultural tariffs, with the two developing countries insisting on broad rights to protect themselves against surges of food imports that could hurt their farmers.
...the sharp increase in transportation costs has implications for the “just-in-time” system pioneered in Japan and later adopted the world over.
“Despite everything, the American economy is still the biggest Rottweiler on the block,” said Jagdish N. Bhagwati, the author of “In Defense of Globalization” and a professor of economics at Columbia. “But if it’s expensive to get products from there to here, it’s also expensive to get them from here to there.”
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School of Chemical Engineering and the Energy Center, School of Materials Engineering and the Birck Nanotechnology Center, Purdue University, West Lafayette Indiana 47906, and Institute of Energy Conversion, University of Delaware, Newark, Delaware 19716

Received July 10, 2008

Revised July 17, 2008