With the ongoing trade war between China and the U.S., worldwide supply chain disruptions and increasing threats from authoritarian states, a general narrative is emerging that international trade and cooperation are on the decline. However, one could argue that the hypothesis of “de-globalization” is an exaggeration, as global trade is slowing down but not reversing and in line with general GDP growth. Furthermore, the WTO recently reached its first trade agreements in almost a decade, showing willingness to pursue cooperation on certain dossiers. Furthermore, re-globalization, an increased focus on “self-sufficiency” or reshoring do not create the resilience which is so badly needed in the face of systemic risks such as pandemics or rising poverty. Similarly, increased international cooperation is required to fight the most pressing problems of our times, such as migration or climate change, but rising protectionism is stifling information sharing and thus innovation, and further increasing inflation. But with rising economic uncertainty and geopolitical risk, it might be plausible that the global economy will be organized along regional blocks that are defined by geography, values and governance. The question then becomes which blocks have a sufficiently strong internal market to create resilient and strong economies. And besides, other forms of globalization (e.g. cultural, informational) could still move on next to this “friend-shoring”.
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