globalisation

This is the way the world ends
Not with a bang but a whimper.

T S Eliot, “The Hollow Men”, 1925.

Actually when it comes to globalisation, we are used to seeing things end with a bang. That’s what happened, almost literally, in 1914, with the start of the First World War. The onset of war made it impossible for central banks and governments to act as agents of international cooperation, and that suffocated the international flow of trade, finance and investment. And so the era of globalisation that had defined the pre-war world for decades came to a very abrupt end.

But can globalisation end with a whimper? Arguably that’s just what’s happening right now. Read more

By Marcos Troyjo of Columbia University

The concept of “emerging markets” came up years ago as a driver of the future of the world. Demographics, territorial scale, low production costs, easy access to commodities – all were signs of impending change in the geo-economic axis.

Countries such as the Brics (Brazil, Russia, India and China) became the world’s “engines of growth”. Export-driven growth in China; a “transition economy” for Russia’s market; outsourcing and technological innovation in India; and “import substitution 2.0” in Brazil kept these economies booming – and social tensions quelled. Read more

By Eric Lascelles of RBC Global Asset Management

Globalisation was an unstoppable force over the past quarter century, marked by trade flows that grew at almost twice the clip of the global economy and by surging international capital flows, unleashing a torrent of demand and productive capacity. Emerging markets basked in outsized economic growth and rising standards of living. The developed world benefited from low prices, greater selection and cheap borrowing costs.

Since 2011, however, world trade has suddenly found itself on a much dimmer trajectory, merely matching the rate of global growth. Relative to the pre-2011 trajectory, exports have fallen a whopping $1.4tn behind schedule. Read more

Globalisation isn’t as simple – or as flat – as you might think. It’s uneven and has been knocked by the financial crisis. In some ways, the world is becoming less globally connected and more regionally-orientated, in contrast to most assumptions.

That’s the findings of the global connectivity index created by academics from the IESE Business School, which sheds light on the current state of globalisation with interesting results. Read more