LSE IDEAS think tank debates likelihood of de-globalisation post-COVID-19
11 May 2020
LSE IDEAS (London School of Economics’ foreign policy think tank, & #1 ranked university-affiliated think tank in the world) has discussed the impact of COVID-19 on globalisation in a virtual debate, hosted on Facebook Live & YouTube.
Hosted by LSE IDEAS as part of LSE’s new online public event series ‘COVID-19: The Policy Response’, LSE IDEAS Director Professor Michael Cox, Visiting Professor Linda Yueh and Visiting Senior Fellow Peter Watkins discussed whether COVID-19 and its impact on the global economy, with nations protecting their borders and even limiting some trade, poses an existential threat to globalisation.
Within the debate, Professor Michael Cox, Director at LSE IDEAS said: “The 2008 Financial Crisis certainly did a massive amount of damage to globalisation, putting it under immense stress with the rise of populism and the challenge to globalism particularly in the US. It raised a whole host of questions around the relationship between national economies and societies, their integration into the wider global economy. So, in a way, the challenge to globalisation we’re witnessing isn’t a new problem.
“However, at this moment in time, the challenge has intensified to a huge degree. People are now asking the question of whether COVID-19 has undermined globalisation all together, due to the fragmentation of the world economy.”
Linda Yueh, Visiting Professor at LSE IDEAS said: “COVID-19 has, in some ways, accelerated a trend towards de-globalisation that was already occurring for economic and geo-economic reasons. There was already a trend towards rebalancing supply chains, due to factors such as environmental concerns, along with advancements in technology, for example, 3-D printing. Alongside this, with geo-political tensions caused by Brexit and the US-China trade war, we’ve already been seeing companies putting contingency plans in place in case of shocks to cross-border supply chains.
“However, during this pandemic, we have seen the top ten manufacturing nations simultaneously go into lockdown, closing their borders. What we are seeing now is a lot of nations, who rely heavily on manufacturing nations such as China, and other East Asian countries, reassessing their supply chains and looking more locally.”
Peter Watkins, Visiting Senior Fellow at LSE IDEAS said: “While I don’t think COVID-19 will ‘put the nail in the coffin’ of globalisation, there undoubtedly will be a loss of innocence about it.
“What were previously seen as almost purely economic or technical decisions about the sourcing of components will become more political – especially, as we are likely to see a broader definition of national security, with a renewed focus on societal resilience.”
Link to debate: https://www.youtube.com/watch?v=N93HHJ7xQSg
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