From Europe to Asia to the United States, there are changes in the air that have resulted in political forces around the world leaning away from long-standing trends of economic globalization, such as Donald Trump’s recent tariff stance against China.
Recent evidence indicates that now, for the first time in over a century, there is a general slowdown in overall economic activity across the globe and a shift towards a new pattern. World trade as we know it is evolving. This pattern is becoming known as ‘slowbalization’ and in this episode of LokadTV, we learn more about this concept and its impact on the world of supply chains.
Over the last few decades, globalization has resulted in the rapid growth of worldwide trade. We look back and question what were the technical factors that led to such an explosion of trade. We try to understand what has since changed in recent times: for example, the considerable gains in productivity due to automation and the ensuing massive lowering of both production and transportation costs - which are paradoxically contributing to this slowbalization phenomena.
We also investigate the macroeconomic indicators that show that slowbalization really is happening. In addition to this, we discuss why there is an overall slowdown in trade activity and a reduction in long-term border investment.
Finally, a number of industries are switching to what could be considered as ‘local supply chains’. We try and explore these local supply chains in more depth and review why many companies would choose to do this. We take into consideration how they are becoming more efficient, the pros and cons, and whether a heightened awareness of environmental questions has had an impact on this shift.