COVID-19 and Deglobalization

Globalization is not new as some would contend, since it has been a reality for millennia. For thousands of years, civilizations have interacted across continents, oceans and seas. However, what sets globalization in recent decades apart from earlier forms is the time factor.

The sociologist, Anthony Giddens regards globalization as a decoupling or “distanciation” between space and time. This points to the speed with which people, goods and capital are able to move from one part of the world to the next. This speed is such that time and space became of little consequence to human interaction.

For the past 30 years or more, we have generally grown accustomed to a more open world. Such has been this openness that many have argued that the world has become hyper-globalized, meaning that globalization itself has undergone a massive change in size, velocity and scope.

In many ways, globalization has been a force for good. Openness has been accompanied by technological progress, enormous capital flows and the availability of goods and services with an ease that previous civilizations would not have even contemplated.

However, globalization has also had its discontents. Nobel laureate Joseph Stiglitz opined in his seminal work titled “Globalization and its Discontents” that trade liberalization, the liberalization of capital markets and the insistence on the privatization of state assets have had less than desirable impacts on many countries.

While the global north comprising of the wealthiest economies has become and continues to get richer, the global south of poor countries has generally been left behind. For instance, many parts of sub-Saharan Africa and the Middle East have yet to reap the benefits of globalization. In the Caribbean, as markets opened, many domestic industries also disappeared.

The irony is that the global north has been at the forefront of trying to rein in certain aspects of globalization, such as open borders and even open markets. The United States (US), once a champion of free market capitalism, including free trade, is increasingly championing protectionism. In Europe, Amnesty International has gone as far as to chide European countries for constructing a progressively impenetrable fortress to keep irregular migrants out as European leaders spend billions of dollars to defend their borders.

Some refer to this apparent backlash against globalization as deglobalization, a movement towards a less connected world, local solutions, and border controls rather than global institutions and free movement.

Deglobalization trends precede the current novel coronavirus (COVID-19) pandemic. However, the pandemic may very well bring about major transformations or a reversal of globalization, even if temporarily.

COVID-19 has paved the way for almost all countries to tighten their borders, something that populist groups, even in liberal countries, are likely to take advantage of. In these countries, there is likely to be sustained opposition to “outsiders” coming in, whether legally or illegally.

Furthermore, the pandemic has also disrupted global supply chains, including loss of manufacturing and shipping capacity in many parts of the world, especially Asia, which is perhaps the single most important region of the world as far as global manufacturing is concerned. This is playing into the hands of countries which are pursuing the onshoring or near-shoring of production, which if it happens en masse, will be difficult to reverse. Such a development would run counter to the world of open markets that we know.

Why does any of this matter? These things matter because many of us harbour ambitions of studying, living and working in other countries. We also want to trade with other countries, invest abroad and attract investments from abroad. Post-COVID-19, the possibility exists that we will face a more hostile world which makes it more difficult to fulfill many of our ambitions.