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:

FTA affinity bonus — if the pair is covered by an active free trade agreement
Bloc affinity bonus — if both countries share membership in the same international organization
Tariff drag — a reduction based on the effective tariff rate between the pair
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:

Tariff Rate	Drag Multiplier	Affinity Change
0%	1.000	0% (no drag)
5%	0.870	-13.0%
10%	0.769	-23.1%
20%	0.625	-37.5%
50%	0.400	-60.0%
100%	0.250	-75.0%

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) 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:

Parameter	Value
Cost	1 cabinet action
Max duration	96 turns (~2 game years)
Max active per member	2
Cooldown per source→target pair	168 turns

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: After an embargo between a specific source and target pair expires, the same pair cannot be embargoed again for 168 turns (~3.5 game years).

This cooldown prevents a country from permanently blockading another — the target gets a recovery window.

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

Scenario	FTA	Bloc	Tariff	Embargo	Final Affinity
Neutral, no tariff	No	No	0%	No	1.00
Same bloc, no tariff	No	Yes	0%	No	1.25
FTA, same bloc	Yes	Yes	0%	No	2.00
20% tariff, no FTA	No	No	20%	No	0.625
FTA + 20% tariff on books	Yes	No	20% (overridden to 0%)	No	1.60
Embargo active	—	—	—	Yes	0.00

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.

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