How Businesses Can Mitigate the Adverse Impact of Deglobalization

Businesses operating in the global market must take proactive steps to minimize the effects of deglobalization and maximize its benefits.

In a world where events in one nation can have far-reaching impact on others, it is tempting to believe that our global community will persist indefinitely. This perception is fueled by digital transformation, cross-border commerce, and favorable geoeconomic policies made possible because of globalization, enabling businesses of all sizes to function on a global scale.

However, escalating geopolitical conflicts, global supply chain disruptions, and the growing adoption of nationalist-protectionist policies are posing significant challenges to globalization, fueling a shift towards deglobalization. According to the World Economic Forum’s, 69% of chief economists predict an acceleration in geo-economic fragmentation, while 86% expect a rise in the localization of economic activities. January 2024 Chief Economists Outlook

As international trade and cooperation wane, businesses grapple with challenges in sustaining their economic viability, profitability, and growth, further straining the already fragile supply chain.

Factors Responsible for Deglobalization