An Israeli-owned ship crammed with 17,000 cattle and sheep from Australia upset animal-rights campaigners when in January it refused to offload the livestock at Perth. The MV Bahijah still hoped to reach Israel after Houthi militants bombarding ships in the Red Sea forced it to return to Australian waters.

The vessel never ventured back to the Red Sea because the Houthi say the attacks that began in November will only end when Israeli forces withdraw from Gaza. Like many other ships, it can only travel around Africa rather than risk attack en route to the Suez Canal that usually handles about 30 per cent of global container traffic. The extra three weeks of travel has disrupted production and added to costs.

So disappears the given that the oceans are safe for commercial ships of all nations. And it’s not just the Red Sea where ships are vulnerable. Russia is blocking Ukraine exports through the Black Sea. China is assuming control of international waters in the South China Sea and could close the Taiwan Strait. Iran threatens to seal the Strait of Hormuz through which passes about 30 per cent of traded oil. Pirates harass ships around the Horn of Africa and the Strait of Malacca.

The long-held ability of ships to safely cross any waters encourages the global commerce that lifts world living standards. The inability of exporters to deliver goods via the most economical sea routes is one of three new threats to the international trade that promotes global prosperity by allowing countries to specialise in their strengths.

The second emerging threat to trade is going green. This has three strands. One is how EU attempts to curb emissions from agriculture have infuriated European farmers. Protests that began in the Netherlands in 2019 against plans to halve livestock numbers have spread to Belgium, the Czech Republic, France, Germany, Greece, Ireland, Italy, Poland, Slovakia, Spain and the UK.

The danger for trade is the farmer revolt around fertiliser use, fallow land and whatnot has become an attack on cheap imports. To placate farmers, European leaders are rejecting trade agreements. As French farmers mounted a tractor siege in January, Prime Minister Gabriel Attal declared Paris would block any EU trade agreement with the South American Mercosur trade bloc countries. Politicians are looking at the agricultural aspects of other EU trade deals. At the very least, they will protect the EU farm subsidies that wreck global trade talks.

A second green blow to trade stems from net-zero industry policies, especially those of China and the US. President Joe Biden is lavishing potentially US$1 trillion worth of tax credits and incentives to power local and foreign-backed green production in the US. That’s sparking retaliation. The EU in 2023 boosted state aid to help Europe compete as a hub for clean products. Such tit-for-tat moves could widen into a ‘trade war’.

Beijing’s support for green goods, especially electric vehicles, elicits similar blowback. The EU this month opened investigations into whether Chinese bidders benefit from subsidies when tendering for a solar power plant in Romania. Last year, the EU launched an investigation into whether tariffs are needed to protect European electric carmakers from cheaper Chinese competition. Expect protectionist recommendations. Biden is thinking of likewise cosseting US automakers from Chinese rivals and countering how internet-connected Chinese vehicles ‘pose risks to our national security’. Countries including Turkey have already boosted such protectionism.

The third environmental trade disruption is the likely proliferation of ‘green tariffs’. In 2023, the EU became the first major economy to levy these import taxes that have two purposes. One is to penalise trading partners that don’t impose carbon taxes on their industries. The other is to stop emissions-intensive local production shifting to countries where no carbon prices are installed.

Green tariffs are problematic because they sit outside agreed rules on trade. Poorer countries resent that richer ones want them to forgo wealth to pay for the West’s past pollution. Countries that export targeted commodities allege discrimination – as Australia did in 2021.

Practical difficulties include that it’s hard to measure emissions on products, especially those compiled across countries. It can be difficult too to gauge what carbon prices have applied elsewhere. Just as national security is often a pretext, green tariffs will likely prove a vehicle for protectionism that has little to do with the environment.

Numerous conflicts and the consequences of going green are challenges underway against free trade. The other threat is only a possibility but would be the most damaging. Donald Trump says that if re-elected US president he will impose a ten-per-cent tariff on imports to the US (compared with an average two-per-cent now). On top, Trump promises 60-per-cent tariffs on Chinese imports. If Trump enacted what would be the most widespread US protectionism since the 1930’s tariffs that deepened the Great Depression, he would boost inflation, destroy China-US trade and upend the US-dominated international trading system that has helped the world economy flourish since the second world war.

These blows to trade follow others. The pandemic sparked a quest for self-sufficiency in essentials. Tensions between China- and the US-led blocs have led to ‘reshoring’, ‘friendshoring’ and the weaponisation of technology and minerals. India raised tariffs on Chinese goods after border clashes. The World Bank forecasts that global trade growth in 2024 will be only half the average recorded during the decades before the pandemic. Expect a commensurate slowing in the rise in living standards. If the challenges to trade fulfil the most pessimistic predictions, expect a decline in GDP per capita. The world will rue messing with the free trade that embodies capitalism.

Note that for all the recent impediments, world trade climbed to a record 74 per cent of global output in 2022 and that ratio could increase. But that rise is due to how Western sanctions boost trade among the West’s enemies and how US tariffs on Chinese imports mean these goods sneak into the US via other countries. The economic cost of this is that the world is using resources less efficiently.

The big danger is that simultaneous blows to free trade could magnify the damage of each. While animal-rights activists might welcome the disruption to livestock trade, everyone will be upset when living standards sink as, in March over on the Red Sea, did the Houthi-struck UK-registered cargo ship Rubymar.