We have taken the view that COVID-19 will accelerate the many trends – good and bad – that have already been visible for some time.
It’s also an opportunity to re-think the current, flawed model of globalisation.
In this issue of Globalisation Outlook we examine how these trends may be accelerated. We take as our guide JM Keynes’s views of globalisation from the 1930s
“Ideas, knowledge, science, hospitality, travel – these are the things that should of their nature be international. But let goods be homespun whenever it is reasonably and conveniently possible. And, above all, let finance be primarily national”JM Keynes, 1933
International scientific collaboration and exchange of knowledge has been one of the bright spots of the current pandemic – in spite of the increasing doubts about the reliability of information coming out of China
Though the slump in international travel and tourism will likely be deep and prolonged, international travel will most likely resume its upward trend at some stage. Exposure to any resurgence of the current infection will therefore likely also be transnational and any new future infection will also likely spread globally
We will likely see an expansion of what countries will start to define as ‘strategic industries’ for which local production capability will form an essential component. And industrial strategy is back in fashion. How far all that will go remains to be seen.
We are well past the time of ‘above all let finance be primarily national’ and it is highly unlikely that genie can be put back in the bottle. The consequences, in terms of huge outflows of ‘hot money’ from developing countries can already be seen in this pandemic.