Countries do not, in fact, trade

The Guardian reports on a report:

Taiwan has become the world’s biggest importer of Russian naphtha, a petroleum derivative used to make chemicals needed for the semiconductor industry, despite the fact that it has joined other sanctions against Russia and considers itself an ally of Ukraine.

In the first half of 2025, Taiwan imported $1.3bn worth of Russian naphtha, and average monthly imports reached a level nearly six times higher than the 2022 average, according to a report published on Wednesday. Compared to the first half of 2024, Taiwan’s naphtha imports this year increased by 44%.

This is not, in fact, true. From the actual report:

State-owned electricity company Taipower, and Taiwan Cement Corporation (TCC), the largest private buyer of Russian coal in 2023, successfully eliminated Russian coal purchases in the latter half of 2024. Similarly, state-owned Chinese Petroleum Corporation (CPC) has not received a shipment of Russian naphtha since June 2024.

Yet other private companies have moved in the opposite direction: Formosa Petrochemical corporation (FPCC) massively increased its Russian naphtha reliance from 9% before the full-scale invasion to 90% in the first half of 2025, single-handedly making Taiwan the world’s largest buyer of Russian naphtha. Furthermore, since the start of Russia’s full-scale invasion of Ukraine until the end of June 2025, FPCC has been the single largest known buyer of Russian naphtha in the world.

We can - if we really want to - suggest that a state-owned company doing the whatever it is is the state doing that thing. But it’s clearly not true to suggest that a private sector company is that country doing that same thing.

Now, as to sanctions on Russia, or even the price of naptha (the EU doesn’t in fact ban it, rather states that no one should pay more than $45 a barrel as against a market price of $55 to $60. Thereby reducing Russian exports or, the cash received for Russian exports) that’s not our point here.

Rather, that much more basic point. It is not “countries” which trade. It might well be individuals within a certain geographic area, or those associations of people we call companies. But it’s not the place, the geography nor the country “doing the trade”.

At which point those complaints about trade deficits, foreigners stealin’ our jobs an’ all the rest go away. Because it’s not government doing the thing it’s that laddie next door who thinks that someone in Omsk is offering a better deal than you are. Which means that the correct answer to losing the deal is to do better not whine to government about trade.

Trade is done by people not countries. Therefore the solution to any trade problem you might identify lies with people, not government.

Tim Worstall