FRAGMENTATION OF THE GLOBAL ECONOMY: CAUSES, CONSEQUENCES AND EXPECTATIONS

Abstract

The shift in priorities in global trade is driven by a number of factors that encourage fragmentation and regionalisation. It has been determined that changes influenced by geopolitical and geo-economic factors have strengthened partnerships within associations and prioritised the protection of participants' national interests. Geopolitical confrontation is the main factor determining the dynamics and prospects of the global economy. The complication of interaction at the global level creates the preconditions for the division of the global economy into competing blocs, reinforcing geo-economic fragmentation. The author's research aims to define the essence and priorities in the development of world trade, justifying the main trends in view of the growing influence of geopolitical factors, identifying dependencies and summarising changes in the configuration of trade models, the transformation of globalisation and world market conditions, directions of adaptation and the intensification of geo-economic fragmentation and regionalisation. It is agreed that contemporary global processes are characterised by politically driven fragmentation, resulting in trade, financial and investment flows being restricted to politically connected partners. Geo-economic fragmentation stimulates changes in supply chains, an increase in foreign direct investment in blocs, and the use of economic instruments such as tariffs for strategic influence, affecting global growth and multilateralism. It is reasonable to assume that the dominant factors of global uncertainty have intensified the processes of fragmentation and regionalisation of the world economy, which is gradually changing the mechanisms and approaches to interaction and partnership between participants, while the world economy is adapting to a landscape that has been altered by new political measures. Expectations are cautious due to the uncertainty of the situation and the reduced role and level of interaction between participants on the basis of strategic partnership. Globalisation processes are transforming, and the format of interaction between participants in the global market is fragmenting.