Globalization is dead?In Davos, it’s a big dealBusiness and the economy

Globalization is dead?

That was one of the big questions pondering at the World Economic Forum in Davos, Switzerland.

The explosion of global connectivity and trade that has been taken for granted for decades is certainly under pressure.

A confluence of factors, from the COVID-19 pandemic to US-China rivalry, Brexit and the war in Ukraine, is challenging long-held assumptions that business and investment should be able to flow freely across borders.

Where once the cost of doing business dictated investment decisions, businesses must now consider the geopolitical and national security factors that increasingly drive government decisions.

Dai Tinglong, a globalization expert at Johns Hopkins Carey Business School, believes that although globalization has not died, it is at least struggling to survive.

“In the next few years, we may see the emergence of an ‘iron curtain of supply chains’, with Western countries maintaining high levels of free trade, investment and people movement among themselves, but censoring links with countries such as China and Russia, Dai told Al Jazeera.

“This means that free trade in sensitive and strategic categories of goods and services will be severely restricted – such as semiconductor chips, car batteries and public health products – and even ordinary supply chains will come under increasing regulation and public pressure .”

The relative lackluster attendance at this year’s World Economic Forum, one of the most-watched annual gatherings of leading political and business leaders, seems like a sign of a shift in wind.

German Chancellor Olaf Schulz was the only G7 leader in attendance. In 2018, six of seven advanced-economy leaders, including then-U.S. President Donald Trump, attended.

Also notable were key leaders from the southern hemisphere, who attended in 2017 and 2018, Chinese President Xi Jinping and Indian Prime Minister Narendra Modi (both addressed the conference via video link).

European Commission President Ursula von der Leyen did attend the meeting, which he used to announce plans for green industry legislation to counter the U.S. Lower Inflation Act, which has riled European governments by subsidizing North American-made electric cars.

Even so, a key message from Davos was that globalization must continue, and perhaps its demise has been overstated.

While China itself has turned inward, toward greater nationalism and protectionism, Xi described globalization in his virtual address to the conference as “the trend of the times” as unstoppable as a river flowing into the sea.

Chinese Vice Premier Liu He appeared in person, emphasizing that foreign investment is still “welcome” and that “China’s door will only open wider.”

Historian Neil Ferguson has even described the idea of ​​a major deglobalization trend as a “mirage,” noting that Chinese apps such as TikTok and Korean pop culture continue to enjoy worldwide popularity even as chips and hardware are increasingly protected doctrine control.

Even though globalization may have peaked, it is far from being completely regressed.

While Apple is looking to move its production out of China, it is focusing specifically on Vietnam and India rather than bringing most of its manufacturing back to the United States.

In this context, it is more accurate to say that globalization is evolving, not retreating — a view echoed by James Mittelman, an expert on globalization and development at the American University in Washington.

“The evidence is overwhelming that the combined effects of the coronavirus pandemic, Brexit, supply chain disruption and the war in Ukraine have created barriers and inefficiencies in cross-border flows, but have not led to a mass exit from globalization,” Mitter said Mann told Al Jazeera.

“There are indications that the tide of globalization will continue to swim against the current. For the future, the puzzling question is not globalization or deglobalization, but what kind of globalization? And how to achieve morally just and politically sensible globalization order?”

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