Globalisation isn’t just ‘American’ anymore!

First, it was the financial crisis. Then Brexit and the election of former US President Donald Trump. Next came a trade war and a pandemic. The war in Ukraine is only the latest event to trigger a wave of claims that globalisation is dead.
Since the Russian invasion began, everyone from newspaper columnists to Wall Street luminaries such as BlackRock Inc Chairman Laurence Fink and Oaktree Capital Group co-founder Howard Marks have decided that the era of expanding global trade and financial ties has ended. Yet such claims don’t match the empirical reality many of us see, especially in Asia.
On the contrary, it seems that our world is only becoming more interconnected. Last year, global trade hit a record $28.5 trillion, up 25% year-on-year and 13% higher than in 2019, before the pandemic struck. For all the talk of decoupling, US-China trade swelled more than 20% last year, to $687.2 billion. Even with war in Ukraine, global trade is forecast to grow in 2022, albeit at a slower pace.
Cross-border investment also surpassed pre-pandemic levels last year, swelling to $1.65 trillion. China, in particular, is more integrated into the global economy than ever. In 2021, its foreign direct investment inflows rose by a third to an all-time high of $334 billion. In the first quarter of this year, they grew by more than 25% year-on-year.
Travel has been slower to recover and international trade as a proportion of global GDP has fallen since its peak in 2008. At the same time, globalisation is evolving and surging in other, non-physical dimensions as well.
Monthly global data traffic soared during the pandemic and is forecast to reach 780 exabytes by 2026, up more than three-fold compared to 2020. Half a million new people connect to the Internet each day.
We are more immersed in a global sphere of images and ideas than ever. Billions are watching what the New Yorker has dubbed “the first TikTok war” unfold via satellite images and livestreams from civilians and soldiers. Ukrainian President Volodymyr Zelenskiy has harnessed the technologies of digital globalisation, captivating the world with selfie videos and addressing multiple national parliaments by Zoom, something that would have been difficult to imagine before the pandemic.
Why then do so many pundits still think globalisation is dying? In part, they appear to be fixated on a particular set of US-centric neoliberal ideas about globalisation that prevailed after the Cold War.
One central belief is what New York Times columnist David Brooks calls “convergence globalisation” — the idea that as countries became more globalised and developed, they would become “more like us in the West.”
In reality, as scholars Heather Berry, Mauro F Guillén, and Arun S Hendi report in a study cited by Brooks, “Over the last half century, nation-states in the global system have not evolved significantly closer (or more similar) to one another along a number of dimensions.” Globalisation has not led to Americanisation.
To the contrary, globalisation is becoming less American and more, well, global.
While the US was at the helm of global trade before 2000, today two-thirds of countries trade more with China. Since Trump turned his back on the Trans-Pacific Partnership free-trade pact and the World Trade Organization, the locus of multilateral trade liberalisation has shifted to Asia.

—Bloomberg