About the seminar

Russia's invasion of Ukraine in 2022 has had significant repercussions on global commodity markets. In the wake of this event, countries have implemented various trade restrictions in the commodities sector, resulting in a more than twofold increase in new policy measures compared to 2021.

Commodities, including critical minerals for the green transition and highly traded agricultural goods, are at particular risk in the face of further geoeconomic fragmentation. The latest IMF’s World Economic Outlook features a dedicated chapter that delves into this issue, providing valuable insights into the potential consequences.

With that in mind, on 20^th October 2023, SITE and the Department of Economics is organizing a seminar on this particular topic at the Stockholm School of Economics (SSE). We are delighted to announce that Jorge Alvarez, representing the World Economic Studies Division of the International Monetary Fund's (IMF) Research Department, will be our esteemed guest speaker for this seminar as he will present a chapter from the latest IMF’s World Economic Outlook. The seminar will be chaired by Maria Perrotta Berlin, Assistant Professor at SITE.

Chapter 3: Fragmentation and commodity markets: Vulnerabilities and risks

(from the IMF World Economic Outlook, October 2023: Analytical Chapters)

Authors: Jorge Alvarez, Mehdi Benatiya Andaloussi, Martin Stuermer

Abstract

Russia’s invasion of Ukraine caused major commodity markets to fragment, and geopolitical tensions could make matters worse. Chapter 3 examines how further disruptions in commodity trade could affect commodity prices, economic activity, and the energy transition. The chapter reaches four conclusions. First, commodities are particularly vulnerable to fragmentation due to concentrated production, hard-to-substitute consumption, and their critical role for technologies. Second, further fragmentation would cause large swings in commodity prices and more volatility. Third, commodity trade disruptions would have highly uneven impacts across countries, though global losses appear moderate given offsetting effects across countries. Low-income countries would bear a disproportionate share of the economic cost, due to their high reliance on agricultural imports. Fourth, fragmented minerals markets would make the energy transition more costly, reducing investment in renewables and electric vehicles by one-third by 2030 in an illustrative scenario. A green corridor agreement could guarantee the international flow of critical minerals. Similar agreements for essential food commodities could stabilize agricultural markets. Such agreements would safeguard the global goals of averting climate change and food insecurity. 

Participate in the seminar

We cordially invite you to join us in Stockholm on 20^th of October to contribute to this thought-provoking topic and engage with fellow students, faculties, researchers, academics, and experts in the field.

The event will take place in room A320, at SSE, Bertil Ohlins gata 5, 113 50 Stockholm. The event will NOT be streamed online.

NOTE: A light lunch will be provided on a first-come, first-served basis.

Please contact site@hhs.se if you have any questions regarding the event.

Photo: Bits And Splits, Shutterstock