THE voyages of the eunuch Admiral Zheng He are often overlooked in the West.

When he was in his early 30s, Zheng set out with a fleet of 317 ships on his first voyage to India. The year was 1405.

Zheng was routinely sailing to Africa nearly a century before Christopher Columbus ever set foot in America.

When Columbus did eventually launch his much more famous expeditions, he did so with a fleet of just three ships: his feted Santa Maria measuring just 19 m.

Zheng, by comparison, had commanded a fleet of more than 350 vessels at its peak, many of which were over 120 m long, held hundreds of men and were laying the foundations of trade routes across Southeast Asia and the Middle East decades earlier.

Yet the technical and economic superiority of China’s 15th century voyages are barely a footnote in most Western historical texts because by 1433, all of China's ‘Treasure Fleet’ ships had been destroyed — burned in their docks, or left to rot by the government.

China had been poised to circumnavigate the globe decades before the Europeans did, but instead the Ming Dynasty retracted into itself.

Foreign trade was seen as being at odds with the values of neo-Confucianist bureaucrats and the Middle Kingdom began to enter a period of inwardness that lasted for almost 400 years.

Some 618 years later, the voyages of Admiral Zheng are increasingly being namechecked by economists as a stark reminder that it is possible to squander massive advantages and find oneself sinking into a pattern of inward-looking stagnation, before being overtaken by much weaker rivals.

So is the West now facing its own 1433 moment?

Four years ago, The Economist used the term “slowbalisation” to describe the fragile state of international trade and commerce; it is a term that has stuck for pretty apparent reasons.

The pace of economic integration stalled in the 2010s as firms grappled with the aftershocks of a financial crisis, a populist revolt against open borders and President Donald Trump’s trade war.

Since then, in strategic sectors that matter, global powers are increasingly talking about economic advances in zero-sum terms and restrictive trade policies are deliberately trying to boost domestic industry at the expense of foreign rivals.

A proliferation of obstacles to international trade and investment have sprung up at a time when both were already stagnating.

So, while the prevailing narrative claiming that the world has entered into a period of deglobalisation appears — for now, at least — to be somewhat wide of the mark, there has been a significant shift in trade patterns that need to be understood to prepare for what comes next.

Global trade will decline in 2023 by about 5% from 2022’s record as high borrowing costs weigh on economies, US-China tensions redirect supply chains and more policies restricting cross-border commerce emerge.

However, maritime trade volumes will continue to grow for the foreseeable future: 2.4% in 2023, and 2.1% over the next five years, according to the latest forecasts from the UN Conference on Trade and Development.

While this represents a slowdown from the average annual rate of maritime trade volume growth of around 3% over the past four decades, it does show the limits of the notion of geoeconomic fragmentation — at least in the short to medium term — and in respect of volume.

The more remarkable trend here is the resilience that supply chains have displayed in the face of successive shocks from Brexit and trade wars to a global pandemic and the invasion of Ukraine.

“In a world rife with cascading crises — geoeconomic fragmentation, retreating development, and climate change — maritime trade serves as a stabilising anchor, holding fast against the turbulent currents of disruption,” wrote Unctad secretary-general Rebecca Grynspan in November.

She makes a valid point.

Maritime trade is changing, but that change can more accurately be described as adaptation rather than retrenchment. For now.

In 2023, both tankers and bulkers have been travelling significantly longer distances, driven by disruptions from the war in Ukraine.

Crude oil and refined products had to go further, as the Russian Federation sought new export markets for its cargo and Europe looked for alternative energy suppliers.

Shipments of grains, meanwhile, travelled longer distances in 2023 than any other year on record.

Although grain shipments from Ukraine resumed in 2022 thanks to the Black Sea Initiative, several grain-importing countries had to rely on alternative grain exporters. They are instead buying from the US, or Brazil, which requires longer hauls. 

Container trade distances had been tumbling since 2020 as intra-Asian trades came to dominate, reflecting global manufacturing patterns, with China continuing to serve as the leader, supported by neighbouring East Asian countries.

The fact that we are ending 2023 with a wholesale re-routing of vessel traffic away from the Red Sea on the basis of the security threat posed by Houthi attacks will inevitably reverse this trend, but shipping will adapt.

In 2023, the prospect of significant disruption to the global supply chain routinely lurks around every news cycle.

The Panama Canal, which has been strained by drought for months and shows no signs of abating, has pivoted from being a catalyst for trade flows to a chokepoint, thanks to the well-trailed impact of climate change, coupled with underinvestment.

Yet the vulnerability of maritime supply chains to blockages is well understood and adapting to the increased complexities of security threats and blockages is business as usual for shipping.

The longer-term shifts and the worrying pull towards protectionist politics are more difficult to manage. And much of this has little to do with the pretext of supply chain resilience under which it is operating.

In a year where US Treasury Secretary Janet Yellen has increasingly been pushing the concept of ‘friendshoring’, we are seeing more and more examples of companies and states attempting to either offshore production across a wider range of locations and a variety of trading partners; or bring manufacturing back home (reshoring); relocating manufacturing to neighbouring countries closer to the home market (nearshoring); or prioritising trade with highly trusted countries that share common values and strategies (Yellen’s friendshoring).

The effectiveness of such approaches remains questionable. Governments trying to boost domestic production in order to reduce their vulnerability to disruptions in foreign supplies are, in many cases, simply swapping one risk for another.

Greater self-sufficiency is likely to leave countries more vulnerable to future shocks, rather than less. Reshoring tends to make production dependent on conditions at home, and more susceptible to a big local shock.

By comparison, diversified supply chains are more resilient, since they depend on the economic performance of a range of different countries.

If Zheng He was setting out in today’s climate on a contemporary version of his trade missions, he would see slowing trade growth, but remarkable resilience and adaptability.

The more worrying omen would be the darkening view of politicians akin to the scholar bureaucrats of his time.

Zheng He would see an increasing tendency towards talk of boosting domestic industry at the expense of foreign rivals and a worrying proliferation of impediments to international trade and investment.

He would know that as the logic of efficiency and comparative advantage gives way to a focus on security and economic nationalism, investments will be duplicated, costs will rise and trade will suffer.

Zheng He would understand — as today’s trade pioneers do — that shipping is endlessly adaptable and can sail around security and physical blockages, but it will struggle to navigate an inward-looking political climate.

This article is part of Lloyd’s List’s ‘Outlook 2024’ special report, which can be viewed in full here