Global problems and new globalization: Is COVID-19 distracting us?

(Spanish version)

The world Economic Forum published an article about the most important threats that the world economy will face, not only right now, but in the next years.

The matter related to the spread of diseases is the number two of the ranking, as it was expected, displacing other problems that in the past were very important like nuclear proliferation, refugee migration, poverty, cyber security, biodiversity loss and, of course, climate change.

Is the pandemic driving us away from these big challenges? I think so. However, in the future, we will have more pandemics, I am sure about that, so it is important to learn as much as we can from this one.

The new globalization.

 The globalization is being substantially transformed. According to “Elcano Institute”, it exists a “huge growth of the information flow component. Globalization, then, continues to advance, but the traditional flows of trade, capital and people have been replaced in their dynamism by the globalization of ideas, data and knowledge”.

Cheap labor  is not as important anymore, or at least not like it was years ago. Automatization and A.I are making that companies substitute workers with technology and, therefore, aspire to guide their production with new goals.

Nowadays, it is important to be near the final consumer, in order to adapt the production better to the changes in the demand. So, we are watching trends like reshoring and nearshoring. The first one means coming back to the original country. On the other hand, nearshoring seek to approach the consumer, but it does not have to involved being in the same country. For instance, some American companies are based in Mexico. In Europe, the trend would be to find a place in the north of Africa.

Not only are companies coming back to their countries of origin thanks to lower costs due to  technology; countries like China are increasing their salaries and making it less attractive to be there. However, the Asian giant is boosting its domestic market to the detriment of exports. It is still a market of more than a billion people.

What does this new Globalization mean? What kind of challenges are we facing?