International Trade

The International Trade system is an inter-country trade clearing engine that computes trade affinity between every pair of countries each turn. Affinity determines how much trade flows between countries and is modified by free trade agreements, shared organization blocs, tariffs, and ministerial embargoes.

Core concept: trade affinity#

Every country pair has a trade affinity value that represents how much trade flows between them. Affinity starts at a base of 1 and is then multiplied (or reduced) by several modifiers:

1. FTA affinity bonus: if the pair is covered by an active free trade agreement
2. Bloc affinity bonus: if both countries share membership in the same international organization
3. Tariff drag: a reduction based on the effective tariff rate between the pair
4. Ministerial embargo: a hard zero if one country has embargoed the other

The final affinity is the product of all applicable modifiers.

Modifiers#

FTA affinity bonus#

When two countries are covered by an active free trade agreement (passed through an international organization), their trade affinity is multiplied by 1.6×.

affinity *= 1.6  // FTA active between the pair

This is the single largest trade modifier in the system and makes FTAs the most impactful diplomatic tool for boosting bilateral trade.

Bloc affinity bonus#

When two countries share membership in the same international organization, their trade affinity is multiplied by 1.25×.

affinity *= 1.25  // both countries in the same org bloc

This bonus stacks with the FTA bonus. Two countries that are both in the EU and have an active FTA receive a combined 1.6 × 1.25 = 2.0× affinity multiplier.

Tariff drag#

Tariffs reduce trade affinity. The drag formula is:

drag = 1 / (1 + 3 × tariffRate)
affinity *= drag

At common tariff rates:

At a 20% tariff, drag is approximately 0.625, meaning trade affinity is reduced by 37.5%. High tariffs make bilateral trade dramatically less efficient.

Note: Tariff drag is computed from the effective tariff rate, which is the sum of all applicable tariff layers (economy-wide, sector, origin-country, corporation-specific). See Tariffs for how the effective rate is calculated. Active FTAs can override the effective rate to zero for covered partners, eliminating drag entirely.

Ministerial embargo#

A ministerial embargo is a hard block on trade between two countries. When active, trade affinity between the embargoing country and the target is set to zero: no trade flows regardless of other modifiers.

IPF convergence#

The trade clearing engine uses iterative proportional fitting (IPF), a method that repeatedly adjusts trade numbers in small steps until every country's imports and exports line up, to balance trade flows across all country pairs. The engine runs 40 iterations, which converges margins to below 0.5%, meaning the result is effectively exact for gameplay purposes.

IPF iterations: 40
Convergence threshold: < 0.5% margin

This ensures that the affinity values produce a self-consistent trade matrix where every country's imports and exports balance correctly.

Ministerial embargoes#

Embargoes are the most aggressive trade tool available. They are issued by a cabinet minister and have strict limits:

Rules#

• Cost: Each embargo consumes 1 cabinet action to enact.
• Duration: An embargo lasts at most 96 turns (approximately 2 game years), after which it expires automatically.
• Concurrent limit: A single member can have at most 2 active embargoes at any time.
• Cooldown: The 168-turn source-to-target cooldown starts when the embargo is enacted, not when it expires.

Because the maximum embargo lasts 96 turns, a full-duration embargo leaves at least 72 turns before that source can target the same country again.

Affinity calculation summary#

The full affinity calculation for a country pair:

let affinity = 1;                          // base affinity

if (pair covered by active FTA) {
  affinity *= 1.6;                          // FTA bonus
}

if (both countries share an org bloc) {
  affinity *= 1.25;                         // bloc bonus
}

const drag = 1 / (1 + 3 × effectiveTariffRate);
affinity *= drag;                           // tariff drag

if (active embargo between the pair) {
  affinity = 0;                             // embargo zeroes trade
}

Example scenarios#

Note the FTA override: even though a 20% tariff is on the books, the FTA collapses the effective tariff to zero for covered partners, so the drag multiplier becomes 1.0 and the full 1.6× FTA bonus applies.

Strategic notes#

• FTAs are the strongest trade lever. A 1.6× multiplier dwarfs all other modifiers. Prioritize passing FTAs through international organizations with your key trading partners.
• Bloc membership is cheap affinity. Simply being in the same org as a trading partner gives a 25% boost with no legislation required.
• Tariffs and FTAs interact. An FTA makes tariffs irrelevant for covered partners: they pay zero. Use FTAs to shield partners from your own tariff policy.
• Embargoes are blunt and temporary. They zero trade but expire after 96 turns and trigger a 168-turn cooldown. Use them for targeted pressure, not permanent isolation.
• IPF convergence is exact at 40 iterations. You can trust that the trade matrix is self-consistent: there are no "approximate" affinity values in the final result.

Related systems#

• International Organizations: where FTAs and bloc memberships are established
• Tariffs: how tariff rates are set and how they stack
• National Budget: how tariff revenue feeds into government finances
• Corporations: how trade affinity affects corporate sector margins