Newfound Love of Globalization
The corona pandemic is not over — neither is the economic crisis it has caused around the world. The recession is hefty, and no one can say how long it will last. The spirited intervention of governments in countries that could afford it will not prevent many companies from eventually becoming insolvent due to over-indebtedness or business models that have become obsolete, nor will it prevent accelerated, deep structural change and the loosening of global economic interdependence. To the extent that economic risks will take on previously unseen dimensions, the costs of a wrong policy might also increase.
Already all too apparent before the crisis, it would be detrimental to give in even more to the tendency to “make it alone”, to selfishness and isolationism, to compartmentalization and protectionism. The only way to make up for lost ground fairly quickly in economic terms is to get the international division of labour moving again, to turn around production profits and to ensure that economic growth around the world leaves the negative figures behind. “De-growth” and “de-globalization” are recipes for disaster. On the contrary, we must now rediscover and recapture what the coronavirus threatened to take away from us: the love of globalization, of international cooperation, of wealth-creating exchange, of the free movement not only of capital, goods and online-tradable services, but also of people. All this requires a healthy perspective, a fresh eye.
This justifies, among other things, higher demands on the strategic reserves of the various countries, hygiene, corporate warehousing and the flexibility of value chains. But this is precisely why there is also a need for a strong political will to remove obstacles to cooperation, i.e. customs duties and non-tariff trade barriers as well as the scandalous blockade of the dispute settlement mechanism of the WTO, the most important institution of world trade. It is high time to put an end to economic wars large and small.
Karen Horn teaches Economic History of Ideas at the University of Erfurt. She lives in Zurich.