The World Economic Forum pessimistic on Globalisation
Some of the leading people in the business and political world met recently in Davos-Klosters, Switzerland at the Annual World Economic Forum.
Many topics were raised and discussed the the Annual Forum and one of which was regarding global trade and it’s apparent deceleration. Many political and business leaders of the world have put this down to the rise of extreme politics and rise in protectionist policies in 2018 which has caused globalisation to slow down.
Livewire discusses this in further detail (article can be found here) and they predict that globalisation is unlikely going to return to its post world war 2 glory any time in the near future, due to two main reasons:
- “Firstly, growth in China and other emerging markets that are strongly exposed to trade may be slower for longer. The tariff negotiations may take longer than expected, and the net result is likely to be a higher cost for goods delivered to the US.
- Secondly, globalisation has been successful in raising millions out of poverty in developing nations. The clearest example of that is China as global production moved there in search of lower costs. However, the globalisation of supply chains may have at least temporarily stalled as wage costs have risen faster in some emerging markets to which production had been outsourced. For example, wages in China have risen to the extent certain manufacturing, such as textiles, has moved to Vietnam where wages are lower.”
On a more positive note, it was great to see gender diversity in action at the 48th Annual Summit with all seven co-chairs being woman, from a cross-section of business, politics, academia and civil society.