23008_Nearshoring Report

Commentators suggest that we are now “post-peak globalisation”. That is not to suggest that global trade will stop, but that we are unlikely to see global trade continue to grow as it has done in the past. Also, the nature of trade is changing: there has been significant growth in intraregional trade in recent years, particularly within the Asia Pacific region where trade has grown by over 400% in the past 20 years as consumers in Asia are consuming more of the product made within Asia.

WORLD TRADE IN MERCHANDISE AS % OF GDP

60%

PEAK OF GLOBAL TRADE

50%

40%

30%

20%

10%

0%

1960 1965 1970 1975 1980

1985 1990 1995 2000 2005 2010 2015 2020

SOURCE: World Bank

The Covid-19 pandemic and the huge disruption to supply chains across the world brought globalisation and the importance of well-functioning supply chains into sharper – and wider – focus. No longer was this an issue for just businesses to contend with as an operational or financial challenge, but something that we as consumers felt acutely. Governments also became far more aware of the economic, financial and social impact that disruption to supply chains can make – not least in the sourcing of medical devices, vaccines and PPE.

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