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1、In partnership withAn in-depth analysis of the state of globalizationSTEVEN A.ALTMAN AND CAROLINE R.BASTIANDHL GLOBAL CONNECTEDNESS REPORT 2024Steven A.Altman is a Senior Research Scholar at the New York University Stern School of Business and an Adjunct Assistant Professor in NYU Sterns Department

2、of Management and Organizations.Professor Altman is also Director of the DHL Initiative on Globalization at NYU Sterns Center for the Future of Management.His research focuses on globalization and its implications for business strategy and public policy.He holds a PhD from the University of Reading,

3、an MBA from the Harvard Business School,an MPA from Harvards John F.Kennedy School of Government,and a BS in Economics from the Wharton School of Business at the University of Pennsylvania.Caroline R.Bastian is a Research Scholar at the New York University Stern School of Business.Ms.Bastian is base

4、d in the schools DHL Initiative on Globalization at its Center for the Future of Management.She coordinates the initiatives work on data science,statistics,quantitative methods,and data visualization.Ms.Bastian holds an MS in Applied Statistics for Social Science Research from NewYork University,a M

5、aster of International Affairs from Columbia University,and a BA from Pacific University.DHL GLOBAL CONNECTEDNESS REPORT 2024Steven A.Altman Caroline R.Bastian NYU Stern School of BusinessCenter for the Future of ManagementDHL Initiative on GlobalizationCONTENTS1.INTRODUCTION Contents 2Preface Tobia

6、s Meyer 4Preface Steven A.Altman 510 Key Takeaways 6Executive Summary 8Country Ranking Highlights 10Notes Section 1 922.GLOBALIZATION SNAPSHOT AND COUNTRY RANKINGS 12Globalization Has Not Gone Into Reverse 13Recent Trends in Historical Perspective 18The Globalization Debate in 2023 19The Worlds Most

7、 Globally Connected Countries 20Increases and Decreases in Countries Global Connectedness 23Globalization and Major World Regions 27Notes Section 2 933.ARE GLOBAL FLOWS STILL GROWING?32Trade 33The Rise of Cross-Border E-Commerce 37Capital 38Information 41International Information Flows via News Medi

8、a 43People 44We Do Not Live in a Hyperglobalized World 48Notes Section 3 9421.Introduction 4.IS GEOPOLITICAL RIVALRY FRACTURING THE GLOBAL ECONOMY?49Superpower Shifts Do Not Equal Global Fragmentation 50U.S.China Ties Diminished,Not Decoupled 52Russias Reorientation 59No Broader Split of the World E

9、conomy 61Country Blocs and Geopolitical Distance 63Notes Section 4 975.IS GLOBALIZATION GIVING WAY TO REGIONALIZATION?65 No General Pattern Of Rising Regionalization 66Trade Regionalization in 2023 69Is a Major Increase in Regionalization on the Horizon?72How Far Do Global Flows Reach Today?75Notes

10、Section 5 99 6.CONCLUSION 76Notes Section 6 1007.METHODOLOGY AND DATA SOURCES 81Notes Section 7 101SELECTED BIBLIOGRAPHY 91COUNTRY PROFILES 102APPENDIX 289Appendix A Detailed Data Sources and Definitions 289Appendix B Pillar Breadth Trends 295Appendix C Country Rankings 3001.Introduction3DEAR READER

11、,In these turbulent times,marked by severe conflicts,this new edition of the DHL Global Connectedness Report presents a remarkable finding:Globalization reached a record high in 2022 and remained close to that level in 2023.Given the widespread speculation about the“end”of globalization,this result

12、might be unexpected for many.But its what the data reveal.The report is based on the meticulous analysis of data from 181 countries,providing a unique picture of how goods&services,people,capital,and information are actually moving around the world.How are such strong globalization numbers possible

13、despite the very real rise of geopolitical tensions,wars,and protectionism?Why do countless headlines claim that globalization itself is in crisis-mode when actual interactions between countries continue to grow?How can these contradictions be explained?I see several reasons for this.First,we might

14、be focusing too much on the largest countries and economies.Many see the U.S.and China interacting less,Europe and Russia decoupling,and the UK leaving the EU as signs of“the end”of globalization.The rate of growth in global trade and connectedness might have slowed,but it stays on a high level.The

15、DHL Global Connectedness Report 2024 shows quite impressively that assuming globalization has ended is misguided.The second reason is novelty bias.We naturally pay more attention to the latest news and apparent change than to stability or status quo.So after decades of focus on globalization,talk of

16、“deglobalization”attracts more attention than evidence of continuing global flows.Then there is negativity bias.Bad news draws more attention than good news.Dramatic events like attacks on ships in the Red Sea,the Panama Canals low water levels,or a giant container ship stuck in the Suez Canal gener

17、ate loud headlines about“deglobalization.”Meanwhile,there is little media coverage of all of the goods being delivered every day without a problem.In addition to shedding light on the true state of globalization,this report offers several other valuable insights.For example,even with the U.S.and Chi

18、na reducing their ties,and Europe and Russia decoupling,the world economy is not breaking apart into rival geopolitical blocs.Many major economies strive for independent and flexible positions,resisting the separation of rival blocs.The report also shows that,contrary to many forecasts,globalization

19、 has not given way to regionalization.We also see a continued advance in corporate globalization.I invite you to dive into the detailsits an insightful read.Last,but not least:Congratulations to Singapore for achieving the number one spot in our ranking of the worlds most globalized countries!Tobias

20、 MeyerCEO,DHL Group41.Introduction DEAR READER,Since we released the last edition of this report a year ago,some of the strains on globalization have eased while others have intensified.The disruptions caused by the Covid-19 pandemic are now clearly in the past,and its economic aftereffects are rece

21、ding.But the United Nations now reports the largest number of violent conflicts since the Second World War,and geopolitical rivalry over key technologies continues to escalate.In this dynamic environment,reliable measures of the state and trajectory of globalization are essential for business and pu

22、blic policy decision-making.This edition of the DHL Global Connectedness Report draws on nearly 9 million data points to provide the most comprehensive available portrait of international flows of trade,capital,information,and people.The data show that there has been no retreat from international to

23、 domestic business activity,and that a fracturing of the world economy along geopolitical or geographic lines is still only a risk rather than a current reality.Even as the public policy context has become less conducive to globalizationand conflicts are dominating the headlinesglobal connectedness

24、reached a record high in 2022 and roughly maintained this level in 2023.The resilience of global flows in the face of such formidable threats sends a strong message about the value of a connected world.This should motivate leaders to redouble their efforts to expand the benefits of globalization,whi

25、le better managing its challenges.I am grateful to Caroline Bastian,who has co-authored this report as well as each edition of the DHL Global Connectedness Index since 2018.Her insights and analytical contributions have substantially strengthened this body of work.We also continue to build on DHL Gl

26、obal Connectedness Index co-creator Pankaj Ghemawats profound insights on the strengths and limits of globalization.My sincere thanks also to Anita Gupta and Mathias Schneider for their steadfast and insightful collaboration on the development of this publication,to Davis Fattedad and Lindsay Hopewe

27、ll for their many contributions to the research reported here,to Md.Shah Naoaj for meticulous research assistance,to Ari Van Assche,Sinziana Dorobantu,Sbastien Miroudot,Lilac Nachum,Rajneesh Narula,Susan Perkins,and Niccol Pisani for reviewing preliminary drafts,to Jonathan Wyss for excellent cartog

28、raphy,to Bjrn Schuman for editorial support,to Keir Bonine for proofreading,and to Dirk Hrdina for turning our text and graphics into a compelling visual product.Finally,I would like to thank DHL Group for its longstanding support of our research and its sponsorship of the DHL Initiative on Globaliz

29、ation at NYU Sterns Center for the Future of Management.Our research initiative aims to be a leading center of excellence for data-driven globalization research.To learn more about our work,please visit our website at stern.nyu.edu/globalization.Steven A.Altman Senior Research Scholar and Director o

30、f the DHL Initiative on Globalization,NYU Stern1.Introduction510 KEY TAKEAWAYSGlobal connectedness reached a record high in 2022 and remained close to that level in 2023.The resilience and growth of international flows of trade,capital,information,and people in the face of recent crises strongly reb

31、uts the notion that globalization has gone into reverse.12Singapore is the worlds most globally connected country,followed by the Netherlands and Ireland.Singapore has the largest international flows relative to domestic activity,while the United Kingdoms flows are the most broadly distributed aroun

32、d the world.3U.S.China ties continue to diminish.The shares of both countries flows involving the other have fallen by about one-quarter since 2016.The pullback from direct U.S.China trade accelerated in 2023.But the U.S.and China are still connected by larger flows than almost every other pair of c

33、ountries.4Russia and Europe have decoupled,severing ties formerly deemed critical to both sides.Russias trade shifted away from Western-aligned countries,and foreign investment into Russia collapsed.Among major G20 economies,Russia had the largest single-year drop in global connectedness on record i

34、n 2022.5Global flows show no general split of the world economy between rival geopolitical blocs.The share of trade happening between U.S.-aligned and China-aligned blocs increased during the Covid-19 pandemic and then fell after Russias full-scale invasion of Ukraine.Excluding Russia,it is now back

35、 roughly to its pre-pandemic level.61.Introduction 7Corporate globalization continues to advance.Companies are earning more of their sales abroad and the value of their announced international expansion projects is at its highest level relative to world GDP in more than a decade.The cross-border sha

36、re of mergers and acquisitions is holding steady,as is the share of global output that companies produce outside of their home countries.6Globalization has not given way to regionalization.Most international flows are taking place over stable or longer distances,with a declining share happening insi

37、de major geographic regions.Focusing specifically on trade,only North America shows a clear nearshoring trend.9The globalization of information flows has increased more than all other aspects of globalization over the past two decades,but the latest data show this trend stalling.U.S.China tensions h

38、ave weighed on international research collaboration,and many countries have imposed restrictions on international data flows.The worlds absolute level of globalization remains limited;domestic flows still far exceed international flows.The worlds current depth of global connectedness is only 25%on a

39、 scale from 0%(no flows cross national borders)to 100%(borders and distance no longer matter at all).108The share of global trade in world GDP was at a record high in 2022.It declined modestly in 2023,consistent with the usual pattern of trade slowing more than GDP when global growth weakens.Trade g

40、rowth is forecast to accelerate substantially in 2024 to a slightly faster pace than GDP.1.Introduction7EXECUTIVE SUMMARYThis report assesses the state and trajectory of globalization based on an analysis of nearly 9 million data points track-ing country-to-country flows of trade,capital,information

41、,and people.It updates the DHL Global Connectedness Index,providing an overview of global trends and profiling the international activity of 181 countries and territories,which comprise 99.7%of the global economy and 98.7%of the worlds population.It also ranks countries according to their levels of

42、global connectedness.The analysis of global trends examines three questions at the center of current debates about globalization:Are global flows still growing?Is geopolitical rivalry fracturing the global economy?Are international flows becoming more regional?The answers will surprise many readers

43、because they contradict prevalent narratives about the world entering a period of deglobalization.Geopolitical threats and public policy shifts have led many to predict the demise of globalization.But the actual flows between countries that we measure in this report have proven highly resilient in t

44、he face of formidable challenges.Are global flows still growing?The evidence strongly rebuts the notion that the growth of global flows has gone into reverse.International flows grew faster than domestic activity in both 2021 and 2022.This drove the worlds overall level of global connectedness to a

45、record high in 2022,and currently available data suggest it remained at roughly the same level in 2023.Trade growth played a key role in boosting global connected-ness.The share of global output that is traded internation-ally,which had fallen after the 2008 global financial crisis,was back to a rec

46、ord high level in 2022.Early data suggest that it declined modestly in 2023,but this is not a signal of deglobalization.Trade growth normally lags behind GDP growth when the global economy slows.In 2024,forecasts call for trade growth to pick up again and to modestly out-pace GDP growth.1 Investment

47、 trends and other measures of corporate global-ization provide further evidence that companies have not lost their appetite for international expansion.There was a sharp rise in the value of announced greenfield foreign direct investment(FDI)in 2022,followed by a smaller increase in 2023.2 Likewise,

48、publicly traded companies from most coun-tries earned more of their sales abroad in 2023 than in 2019.3 Meanwhile,the share of mergers and acquisitions involving companies from different countries continues to hold steady,as does the share of global output generated by the foreign operations of mult

49、inational firms.4 The globalization of information flows,on the other hand,appears to have stalled in 2022 and 2023.This represents a notable change,since information flows were the aspect of globalization showing the fastest increases over the prior two decades.International patenting has continued

50、 to inten-sify,but charges for use of foreign intellectual property(as a share of world GDP)and international coauthorship of scien-tific articles show recent declines.The reduction in interna-tional coauthorship of scientific articles was due,in part,to less research collaboration between the U.S.a

51、nd China.5 People flows were hit hardest by the Covid-19 pandemic,but they continued a strong recovery trend in 2023.Inter-national travel reached 88%of its pre-pandemic level and was on track for a full recovery by the end of 2024.6 To boost international tourism,visa-free travel was allowed betwee

52、n a record high number of countries in 2023.7 The lat-est data also show increases in international migration and education.While these results show most international flows still grow-ing,international flows are still much smaller than the flows that happen inside countries.The idea that we have be

53、en liv-ing in an age of unfettered globalization is a myth.The DHL Global Connectedness Index reported here uses a revised methodology that,for the first time,measures the worlds depth of globalization on a scale running from 0%(noth-ing crosses national borders at all)to 100%(a“frictionless”world w

54、here borders and distance have ceased to matter).It currently stands at 25%,which means we are still closer to a 81.Introduction world of separate countries than to a fully globalized world.Without policy constraints,there is ample scope for coun-tries to continue growing their international flows.8

55、 Is geopolitical rivalry fracturing the global economy?For countries at the center of current tensions,we do indeed see clear shifts in their international flows.Nevertheless,there is still no clear evidence of a wider split of the world economy between rival blocs of allied countries.The United Sta

56、tes and China have reduced their direct flows with each other,with an average decline of roughly one-quarter in the share of U.S.flows involving China and vice versa since 2016.The drops were widespread across trade,capital,information,and people flows,with falling shares for 9 out of 11 types of fl

57、ows from the U.S.perspective and 8out of 10 from Chinas perspective.The pullback from direct U.S.China trade accelerated in 2023,but that acceleration was not matched across most other types of flows.The shifts in U.S.China flows represent less a decoupling of the worlds two largest economies and mo

58、re a reduction of what had previously been an unusually high level of integra-tion.The U.S.and China are still connected by larger flows than almost every other pair of countries worldwide,despite the fact that they are on opposite sides of the world and dif-fer in many ways that typically reduce ti

59、es between countries(e.g.,politically and culturally).The term“decoupling”better describes another dramatic shift in international flows:the reorientation of Russias flows away from Europe and other Western-aligned economies since Russias full-scale invasion of Ukraine.In this case,ties that had pre

60、viously been viewed as crucial for both sides have been cut drastically.In the realm of trade,Russia pivoted to alternative export markets and import sources,but no similar substitution has taken place for international business investment.As a result,announced greenfield FDI into Russia has collaps

61、ed.9 These developments have not,however,led to a wider split of the world economy between rival blocs of geopolitically friendly countries.As other sources have reported,there has been faster(less negative)trade growth within blocs compared to between blocs since early 2022.10 But that reflected,in

62、 part,a reversal of the opposite pattern during the Covid-19 pandemic.Moreover,close to half of the difference in growth rates was due to the reorientation of Russias trade flows alone.Setting Russias trade aside,the share of trade happening between(as compared to within)U.S.-aligned and China-align

63、ed blocs has merely declined back to roughly pre-pandemic levels.A separate analysis of the average“geopolitical distance”traversed by countries international flows(measured based on how countries vote in the UN General Assembly)confirms that there is no general pattern of countries interacting more

64、 with other countries that have similar geopolitical perspectives.11 Are international flows becoming more regional?Through 2023,there is no robust evidence of international flows gen-erally becoming more regional.If flows were regionalizing,they would usually happen over shorter distances.In fact,m

65、ost types of flows have tended to take place over stable or longer distances.There was a modest shift in 2023 toward shorter-distance trade,but trade flows still averaged slightly longer distances than in 2021.The only major trading region showing a clear nearshoring trend over multiple years is Nor

66、th America.The lack of wider evidence of trade regionalization might be another surprise for some readers,because several pub-lications identified a rising trend in the share of trade hap-pening inside regions starting roughly a decade ago.12 That trend,however,turned out to be short-lived,and it ap

67、peared only with some ways of defining regions and not others.13 Subsequent research has established firmly that trade was stretching out over longer distances,not regionalizing.14 It is also important to keep in mind that international flows are already highly regionalized.Roughly half of internati

68、onal trade,capital,information,and people flows take place inside major world regions.This is about three times more than one would expect if flows were not constrained by the distance and differences between countries.15 1.Introduction9COUNTRY RANKING HIGHLIGHTSWORLDS MOST GLOBALLY CONNECTED COUNTR

69、IES 1.Singapore2.Netherlands 3.Ireland4.Luxembourg5.Malta6.Switzerland 7.Belgium 8.United Arab Emirates 9.United Kingdom 10.Hong Kong SAR,ChinaCOUNTRIES WITH LARGEST CONNECTEDNESS INCREASES SINCE 2001 1.United Arab Emirates 2.Malta3.Djibouti4.Slovenia5.Mozambique 6.Singapore7.Netherlands 8.Cyprus9.G

70、eorgia 10.QatarCOUNTRIES WITH LARGEST INTERNATIONAL FLOWS RELATIVE TO DOMESTIC ACTIVITY 1.Singapore2.Luxembourg3.Malta4.Hong Kong SAR,China5.Ireland6.Netherlands 7.United Arab Emirates 8.Belgium 9.Seychelles10.CyprusCOUNTRIES WITH BROADEST GEOGRAPHIC REACH OF INTERNATIONAL FLOWS 1.United Kingdom 2.U

71、nited States3.Netherlands4.Switzerland5.Israel6.Germany 7.Japan 8.Sweden 9.Brazil10.Italy101.Introduction It remains an open question whether international flows will become more regional in the future.Many companies and governments are working to foster regional supply chains,and such reconfigurati

72、ons can take several years to execute.Friendshoring could also lead to nearshoring,because coun-tries that are closer geographically also tend to be more closely aligned geopolitically.Nonetheless,nearshoring strategies often entail trade-offs,and we have already noted that most flows are already hi

73、ghly regionalized,which limits the scope for further increases.Our examination of globalization at the level of individual countries provides additional evidence of the resilience of global flows.In 2022,the most recent year for which we have full country-level data,143 countries became more globall

74、y connected,while only 38 saw their levels of connectedness decline.The countries with the largest declines were Belarus and Russia.The drop in Russias connectedness was more than twice as large as any previous decline on record for a country that ranks among the worlds 20 largest economies.The coun

75、try with the largest increase was Bahrain,where merchandise export values surged and there was a spike in inbound M&A activity.Moreover,recent increases in global connectedness have taken place even as the public policy environment has become less conducive to globalization.Trade barriers,investment

76、 restrictions,and data flow constraints have all increased,and geopolitical tensions are challenging key institutions,such as the World Trade Organization(WTO).Why has globalization proven so resilient in the face of such formidable threats?In the concluding section,we highlight five likely contribu

77、tors:1.The benefits of global connectedness are substantial.As a result,there are real costs involved with any meaningful proposal to cut a countrys ties with the rest of the world.2.The world is less globalized than many presume.This shrinks the scope for deglobalization and makes it more costly.It

78、 also means that countries can address many concerns about globalization without further restricting international flows.When international flows are small compared to domestic activity,problems blamed on globalization often require domestic policy solutions.3.Regionalization and friendshoring are n

79、othing new.Interactions already take place disproportionately between nearby and friendly countries.So targeted de-risking strategies pose little threat to globalization.4.Multipolarity might support globalization.The opportunities for international exchange grow when economic activity is distribute

80、d more evenly across countries.And many countries are strenuously resisting pressure to line up into rival geopolitical blocs.5.Companies adapt creatively to new constraints.Multinational firms have been called the“visible hand of globalization.”16 When one trade lane or investment avenue closes to

81、them,they often find alternative ways to keep markets connected.How should leaders respond to globalizations resilience in the face of powerful threats?Ultimately,the key is to maintain a balanced perspective,recognizing the strength of global flows alongside the threats to globalization.These threa

82、ts must be taken seriously,because history shows that globalization can go into reverse.At the same time,a lopsided focus on the threats risks turning deglobalization into a self-fulfilling prophecy.In our view,leaders should redouble efforts to address the root causes of the worsening policy enviro

83、nmentby expanding the benefits of globalization and widening their reach across societies,and by advancing fact-based debates about how to make a connected world work better for all.1.Introduction112.GLOBALIZATION SNAPSHOT AND COUNTRY RANKINGSThis section provides an overview of the state of globali

84、zation at multiple levels of analysis.A look at global trends highlights the fact that international flows continue to grow and that most countries have not reoriented their international activity along regional or geopolitical lines,despite current tensions.At the country level,we see large differe

85、nces in levels of globalization persisting between different parts of the world.Overall,far more countries saw their levels of connectedness increase than decrease in 2022.GLOBALIZATION HAS NOT GONE INTO REVERSEThe world has faced a series of shocks over the past decade,with the Covid-19 pandemic an

86、d wars in Ukraine and Gaza following on the heels of the U.S.China trade war and the UKs withdrawal from the EU.These disruptions,along with gradually rising geopolitical tensions,have prompted much debate about a potential reversal of globalization(seeTheGlobalization Debate in 2023 on p.19).Data o

87、n actual flows between countries,however,do not show a gen-eral pattern of deglobalization.The DHL Global Connectedness Index tracks a depth trend(see Figure 2.1)that measures international relative to domestic activity.This trend rose to a record high of 25%in 2022 and currently available data sugg

88、est that it maintained T The depth index trend summarizes the global balance of international versus domestic activity across 13 types of trade,capital,information,and people flows.Considering our focus on business and economics,trade and capital flows are given more weight(35%each)than information

89、and people flows(15%each).This trend rises when the growth of international flows outpaces the growth of domestic activity,and it falls when international growth lags behind domestic growth.The global results are scaled between 0%(a world of completely separate countries)and 100%(a com-pletely globa

90、lized“frictionless”world,where national borders and distance pose no constraints to international flows).FIGURE 2.1:DHL GLOBAL CONNECTEDNESS INDEX DEPTH TREND,20012023*The DHL Global Connectedness Index depth reached a record high level of 25%in 2022,and currently available data suggest that it rema

91、ined at a similar level in 2023.01 03 05 07 09 11 13 15 17 19 21 23*2023 projected2.Globalization Snapshot and Country Rankings1330%25%20%15%10%5%0%a similar level in 2023a clear sign that there has been no retreat from international to domestic activity.(For addi-tional historical context,refer to

92、the box titled Recent Trends in Historical Perspective on p.18.)At the same time,this measure also shows that the worlds level of globalization is still limited,with substantial potential for additional growth.The depth of global connectedness is measured on a spectrum from 0%to 100%.A level of 0%wo

93、uld mean that no flows cross national borders at all.In contrast,a level of 100%would mean that borders and dis-tance have ceased to matterflows are as likely to happen between countries as within them.1 The current level of 25%means that even after decades of globalization,we are still closer to a

94、world of separate countries than a completely glo-balized world.Figure 2.2 separates the overall depth trend into its four pil-larstrade,capital,information,and peopleto measure the globalization of four broad categories of human activ-ity.It shows that the intensification of global flows in 2022 wa

95、s broad-based,with increases on three of the four pillars(trade,capital,and people).It also highlights how globaliza-tion levels and trends differ substantially across types of flows(which we will examine in greater detail in Section 3).2 nTrade:Rapid trade growth during the Covid-19 pan-demic drove

96、 the share of trade in global economic output to a record high in 2022.This was due to strong growth of merchandise trade volumes,along with ele-vated commodity prices and recovering services trade.In 2023,slowing macroeconomic growth on the heels of large interest rate increases in many countries,l

97、ed to a modest pullback in global trade intensity.nCapital:International investment flows also acceler-ated during the Covid-19 pandemic.While foreign direct investment(FDI)flows have been weak,measures that more directly track new business commitments,such TRADEMerchandise TradeServices TradeCAPITA

98、LAnnounced Greenfield FDIAnnounced M&A TransactionsFDI FlowsFDI StockPortfolio Equity StockINFORMATIONOnline News Traffic*Scientific Research CollaborationCharges for Use of Intellectual PropertyInternational Internet Bandwidth*International Patenting+PEOPLEInternational TravelInternational Universi

99、ty StudentsMigrants(foreign born population)FLOW TYPES MEASURED BY THE DHL GLOBAL CONNECTEDNESS INDEX*Country level only+Global trends only142.Globalization Snapshot and Country Rankings as announced greenfield FDI,have remained strong.Geopolitical tensions and supply disruptions have moti-vated sub

100、stantial new investments aimed at boosting resilience.3 nInformation:The largest increase over the past two decades has been in the globalization of information flows,propelled by digitization and the rapid growth of international internet bandwidth.However,the infor-mation pillar showed no further

101、increases in 2022 and 2023.Geopolitical tensions and policy restrictions on data flows may be starting to meaningfully constrain the growth of this aspect of globalization.nPeople:People flows are far less globalized than trade,capital,or information flows.Most people seldom leave their home countri

102、es,and a mere 3.6%of people live abroad.4 People flows were also hit hardest by the Covid-19 pandemic,which brought international travel to a halt.By 2023,though,international travel had recovered to 88%of its pre-pandemic level and was forecast to modestly exceed pre-pandemic levels in 2024.5 Clear

103、ly,the growth of global flows has not gone into reverse.But are global flows fracturing along geopolitical lines or between geographic regions?At the wider global level,there is still no clear pattern of global flows breaking down along regional or geopolitical lines.However,some important shifts in

104、 flow patterns are visibleprimarily involving coun-tries at the center of present geopolitical tensions.As we will see in detail in Section 4,the two most impor-tant geopolitically driven shifts in flow patterns are(1)a reduction in direct ties between the U.S.and China and(2)2.Globalization Snapsho

105、t and Country Rankings15FIGURE 2.2:DHL GLOBAL CONNECTEDNESS INDEX PILLAR DEPTH TRENDS,20012023*As seen in the top graph,information flows have reached the highest level of globalization compared to the other three flow types.Capital flows are sec-ond,followed by trade flows.People flows lag far behi

106、nd,at much lower levels of globalization.40%35%30%25%20%15%10%5%0%01 03 05 07 09 11 13 15 17 19 21 23*2023 projectedFour Flows ComparisonTradeCapitalInformationPeopleTradeTrend Details by FlowInformationCapitalPeople24%22%20%18%16%45%40%35%30%25%32%30%28%26%24%22%3.5%3.0%2.5%2.0%01 2301 2301 2301 23

107、a wholesale reorientation of Russias international flows since the full-scale invasion of Ukraine.To briefly illustrate,consider recent shifts in the U.S.and Russias merchan-dise imports(see Figure 2.3,left side).There has been a large drop in the share of U.S.imports coming from China since 2018,an

108、d an even larger drop in the share of Russias imports coming from the EU since 2021.But this has notat least yetled to a wider breakdown of global trade along geopolitical lines.As other studies have reported,there has been faster(less negative)trade growth within geopolitical blocs(as com-pared to

109、between blocs)since Russias full-scale invasion of Ukraine.However,this does not represent clear evidence of fragmentation for two reasons:First,trade between blocs grew faster than trade within blocs during the Covid-19 pan-demic(in part because the world relied more on goods from China during that

110、 period).Second,almost half of the recent difference in growth rates was due to the reorientation of Russias trade flows alone(and a smaller part was due to the pullback from direct U.S.China trade).As shown on the right side of Figure 2.3,setting Russias trade aside,the share of trade happening bet

111、ween blocs(versus within blocs)has merely declined back to roughly its pre-pandemic level.6 Aggregate data on global flows of trade,capital,informa-tion,and people also show no clear evidence of fragmenta-tion along regional or geopolitical lines.Figure 2.4 tracks the 162.Globalization Snapshot and

112、Country Rankings FIGURE 2.3:SUPERPOWER TRADE SHIFTS DO NOT EQUAL GLOBAL FRAGMENTATIONThe U.S.and China have pulled back from direct trade with each other,and Russias trade has shifted dramatically away from Western countries since the full-scale invasion of Ukraine and subsequent sanctions.But the r

113、est of the worlds trade shows no meaningful split between rival geopolitical blocs.Data Source:IMF Direction of Trade StatisticsNote:2023 trade data reflect January to September only.Russias trade flows are based on data reported by Russias trade partners(“mirror data”).Geopolitical blocs represent

114、groups of close allies surrounding the U.S.and China,based on a country classification developed by Capital Economics(see p.63).45%40%35%30%25%20%15%10%5%0%18 19 20 21 22 23Superpower Trade Shifts:Merchandise Import SharesRatio of Trade Between Blocs to Trade Within Blocs (Trailing Four Quarters)201

115、8202321%14%39%17%U.S.Imports Share from ChinaRussia Imports Share from EU20212023All CountriesExcluding RussiaExcluding Russia and U.S.China Trade1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4average geographic distance(kilometers)traversed by inter-national trade,capital,information,and people flo

116、ws,along with their average geopolitical distance(measured based on how countries vote in the UN General Assembly,see p.63).If there was a general pattern of countries interacting more with their regional neighbors or with other countries that have similar geopolitical orientations,both trends would

117、 be going down.But the actual data show no such recent declines.The evidence against a general pattern of geographic region-alization is especially strong.International flows averaged the longest distance on record in 2022,with the smallest share happening inside major world regions.In 2023,as we wi

118、ll see in Section 5,most flows with data already available still do not show increases in regionalization.Merchandise trade,however,did become slightly more regionalized in 2023,with the clearest shift toward more regionalized trade happening in North America.The global trends summarized here strong

119、ly challenge the notion that globalization has gone into reverse.In fact,global flows have proven highly resilient:growing faster than domestic activity and stretching out across greater dis-tances.As such,there continue to be large opportunities for countries to participate in international flows.W

120、e turn next to comparing the global connectedness of countries and regions around the world.2.Globalization Snapshot and Country Rankings17International flows recently have taken place,on average,over longer geographic and stable geopolitical distances,suggesting no general pattern of fragmentation

121、between regions or geopolitical blocs.Note:Geopolitical distance based on UN General Assembly voting between 2018 and 2022,rescaled 0100.Data Sources:International flow data based on sources cited in Section 7.Geographic distance based on CEPII Gravity database.Geopolitical distance based on M.A.Bai

122、ley,A.Strezhnev&E.Voeten(2017).FIGURE 2.4:GEOGRAPHIC AND GEOPOLITICAL DISTANCE TRENDS,20012022Average Distance(kilometers,left scale)Geopolitical DistancePercent Within Regions(right scale)5,1005,0505,0004,9504,9004,8504,8004,7504,7004,65052%51%50%49%48%47%46%45%44%43%25.024.524.023.523.022.522.001

123、04 07 10 13 16 19 2201 04 07 10 13 16 19 22Geographic DistanceGeopolitical DistanceRECENT TRENDS IN HISTORICAL PERSPECTIVETo provide a balanced view of recent shocks to interna-tional flows,it is helpful to consider them in relation to long-run patterns.Here,we look back at the growth of internation

124、al trade,investment,migration,and travel over time spans ranging from several decades to almost two centuries.Figure 2.5 tracks long-run trends on the globalization of trade,FDI,migration,and travel.It shows how all of these aspects of globalization have soared over the last few decades and remain a

125、t or near all-time highs.182.Globalization Snapshot and Country Rankings FIGURE 2.5:LONG-RUN TRADE,FDI,MIGRATION,AND TRAVEL TRENDS7 The world is at or close to a record high level of globalization based on selected trade,investment,and migration measures,and international travel was at a record high

126、 before the Covid-19 pandemic.FDI Stocks(%of GDP)Exports(%of GDP)Migrants(%of Population)Travel(Intl Arrivals per Capita)35%30%25%20%15%10%5%0%50%40%30%20%10%0%4.0%3.5%3.0%2.5%2.0%1.5%1.0%0.5%0.0%0.250.200.150.100.050.001840 1900 1960 20201900 1940 1980 20201870 1920 1970 20201940 1960 1980 2000 202

127、0THE GLOBALIZATION DEBATE IN 20238Debates about the future of globalization continued in 2023,but there was less talk of the“end of globalization”than in 2022,when the war in Ukraine prompted a wave of speculation about a reversal of economic integration.9 In 2023,there was more discussion of global

128、ization changing rather than ending or reversing.“Globalization isnt dead,but it is certainly changing.”Jane Fraser,CEO of Citi“Globalizationis not over,nor should anyone wish for it to be.But it needs to be improved and reimagined for the age ahead.”Ngozi Okonjo-Iweala,Director General of the World

129、 Trade Organization“In the chip sector,globalization is dead.”Morris Chang,Founder of Taiwan Semi-conductor Manufacturing Company“While there are no signs of broad-based retreat from globalization,fault lines are emerging as geoeconomic fragmentation is increasingly a reality.If fragmentation deepen

130、s,we could find ourselves in a new Cold War.”Gita Gopinath,Deputy Managing Director of the International Monetary Fund“It appears that for the time being there is no consistent trend towards deglo-balization but rather a change in the nature of globalization,leading to a rise in the regionalization

131、of trade and supply chains,a diversification of sourcing and a certain slowdown in global value chain fragmentation.”Pablo Hernndez de Cos,Governor of the Bank of Spain“The new Globalization 2.0 will be more stable and actually politically more durable because there will be more countries involved.”

132、David Hunt,President and CEO of PGIM“We are witnessing a fragmentation of the global economy into competing blocs,with each bloc trying to pull as much of the rest of the world closer to its respective strategic interests and shared values.”Christine Lagarde,President of the Euro-pean Central Bank“T

133、he old rules-based form of globalization is indeed dead.It is not coming back any time soon.”Ram Charan,Business Consultant,and Rita McGrath,Professor of Management at Columbia Business School“The world may not fully deglobalize,but that does not mean we should assume smooth sailing ahead.”Mohamed E

134、l-Erian,Former CEO of PIMCO2.Globalization Snapshot and Country Rankings19THE WORLDS MOST GLOBALLY CONNECTED COUNTRIES Much recent attention has focused on whether globalization is advancing or receding worldwide.But most companies and countries interact primarily with just a few other countries,not

135、 with the whole world.This is why country-level global-ization measuresespecially those pertaining to ones own country and its key partners in international exchangeare especially pertinent for business and policy analysis.10 The DHL Global Connectedness Index ranks countries based on their internat

136、ional trade,capital,information,and people flows(see p.14).It assesses these flows along two dimen-sions:depth(size of international flows relative to domestic activity)and breadth(distribution of flows across origin/destination countries).For our index methodology,refer to Section 7.Table 2.1 repor

137、ts the latest overall global connectedness rankings(based on data from 2022).Singapore was the worlds most globally connected country in 2022,followed by the Netherlands,Ireland,Luxembourg,Malta,Switzer-land,Belgium,the United Arab Emirates,the United King-dom,and Hong Kong SAR(China).At the bottom

138、of the rankings,in ascending order,were:Guinea Bissau,Yemen,SoTom and Prncipe,Niger,Burundi,Sudan,Kiribati,Bhutan,Tajikistan,and Lesotho.The country rankings on the separate depth and breadth dimensions of the index are reported in Figures C.2 and C.3 on pages 302303.The economies with the largest i

139、nter-national flows relative to domestic activity(depth leaders)in 2022 were:Singapore,Luxembourg,Malta,Hong Kong SAR(China),Ireland,the Netherlands,the United Arab Emirates,Belgium,the Seychelles,and Cyprus.Economies with higher depth scores tend to be both wealthy and relatively small.Naturally,ad

140、vanced economies with limited internal markets will have a larger share of their trade,investment,communi-cations,and even people,outside of their own borders.DEPTH AND BREADTH DIMENSIONS OF GLOBAL CONNECTEDNESSWe measure each countrys international flows along two dimensions:depth and breadth.We me

141、asure the depth of international flows:This means we compare each cross-border flow to a relevant measure of domestic activity.For trade,for example,we compare exports to total eco-nomic output.This and other ratios help us evalu-ate how significant the respective international flow is.BreadthGeogra

142、phic Distribution of International FlowsDomesticInternational25+75DepthInternational Flows Relative to Domestic ActivityWe measure the breadth of international flows:This means we evaluate to what extent flows are distributed broadly around the globe rather than concentrated between specific origins

143、 and desti-nations.After all,in a truly globalized world,one would expect countries to trade with a wide variety of nations rather than just a few neighbors.202.Globalization Snapshot and Country Rankings Change 1722RankCountryScoreRankScore1Singapore79012Netherlands75113Ireland74104Luxembourg73-2-3

144、5Malta71226Switzerland70-1-17Belgium69238United Arab Emirates69349United Kingdom69-1210Hong Kong SAR,China68-4-311Denmark671312Sweden661313Germany641214Cyprus64-4-215Hungary631316Estonia6311417Finland631318Czechia62-1219Slovenia624320Norway61-5021Israel61-2122Austria61-2123France61-2124Qatar614225Ba

145、hrain607326Malaysia60-2127Lithuania6013428Iceland59-6029Canada590130Seychelles59-5131Spain594232Portugal5910433Australia59-7134Korea,Republic of593235Taiwan,China59-2136Italy583237Bulgaria581238Slovakia58-2139Thailand58-8140Poland583341Lebanon583342Greece586443New Zealand57-13-144United States57-100

146、45Viet Nam57-4146Latvia571347Serbia568348Croatia564349Saudi Arabia55-3150Japan55-1151Trkiye(Turkey)556252North Macedonia5517453Macau SAR,China548254South Africa54-4155Romania544256Ukraine540157Chile545258Kuwait53-13-259Maldives53-6060Cambodia53-9061Brazil52132Change 1722RankCountryScoreRankScore62In

147、dia521163Georgia523164Armenia5222365Philippines52-7066Libya5255667Guyana5240568Oman52-1169Mauritius52-15-170Jordan52-6171Grenada522172Morocco5211273Djibouti51-1174Panama51-6075Brunei Darussalam515176Montenegro515177Mexico510178Mongolia51-2179Andorra50-14-180China50-10-181Tunisia5016282Costa Rica5013

148、283Peru5010184Moldova507185Bosnia and Herzegovina504186Ghana50-4087Trinidad and Tobago49-8088Jamaica49-3089Fiji49-11090St.Kitts and Nevis49-3091Russian Federation49-31-392Mozambique490093Colombia4915294Albania497195Argentina4911196Barbados49-21-297Sri Lanka49-7098Kazakhstan48-4099Uruguay4831100Surin

149、ame48101101Iraq4881102Namibia48273103Egypt48-70104Nicaragua4810105Ecuador48142106Honduras48162107Belize48-9-1108Antigua and Barbuda47-20-2109Indonesia47-9-1110Azerbaijan47-39-4111Gabon4700112Congo47-8-1113St.Lucia46-29-3114Senegal46292115Pakistan46-10116St.Vincent and the Grenadines46262117Angola46-

150、5-1118Dominican Republic4661119Nigeria46-10120Algeria46101121Guinea46-22-2Change 1722RankCountryScoreRankScore122Bahamas46-19-2123Kenya4620124Liberia45222125Kyrgyzstan45141126Ethiopia45-10-1127Cte dIvoire4561128Dominica45-8-1129Madagascar45-30130Bolivia,Plurinational State of4510131El Salvador45-8-1

151、132Guatemala4530133Bangladesh4510134Paraguay45131135Iran,Islamic Republic of45-18-1136Uganda45141137Myanmar44-10-1138Marshall Islands44-25-2139Sierra Leone4451140Lao Peoples Democratic Rep.44121141Zambia44101142Chad44111143Tonga44-7-1144Cameroon4410145Mauritania44-8-1146Belarus44-31-3147Uzbekistan43

152、161148Nepal43-10-1149Tanzania,United Republic of43101150Rwanda4360151Samoa43-23-2152DR of the Congo43-4-1153Vanuatu43-21-2154Cuba43-13-1155Togo430-1156Zimbabwe42192157Cabo Verde42-17-2158Botswana4240159Venezuela,Bolivarian Republic of4250160Gambia4250161Burkina Faso42-3-1162Papua New Guinea42-5-1163

153、Benin4290164Mali4260165Haiti4220166Solomon Islands41-17-2167Central African Republic4110168Eswatini4130169Malawi41-3-1170Afghanistan4141171Timor-Leste41-2-1172Lesotho41-12-2173Tajikistan4141174Bhutan40-10175Kiribati40-21-3176Sudan4021177Burundi4021178Niger39-2-1179So Tom and Prncipe39-18-3180Yemen38

154、12181Guinea-Bissau37-102.Globalization Snapshot and Country Rankings21TABLE 2.1 GLOBAL CONNECTEDNESS RANKS AND SCORESEast Asia&PacificSouth&Central America&CaribbeanMiddle East&North AfricaSub-Saharan AfricaEuropeNorth AmericaSouth&Central AsiaThe countries with the most globally distributed flows(b

155、readth leaders)were:the United Kingdom,the United States,the Netherlands,Switzerland,Israel,Germany,Japan,Sweden,Brazil,and Italy.The countries with the highest breadth scores have large economies(and high per-capita incomes).All of the top 10 countries on breadth rank among the worlds 30 largest ec

156、onomies.Singapore was the top ranked country on overall global connectedness.Singapore also topped the depth dimen-sion,highlighting the size of its international flows relative to domestic activity.Its 25th place ranking on breadth is also impressive,considering the countrys small size.As noted alr

157、eady,smaller countries tend to have high depth but low breadth.As a city state with major port operations and a thriving financial sector,Singapore is uniquely positioned to excel in globalization.Well before the pursuit of“global city”status became fashionable,Singapore began enacting poli-cies to

158、leverage global connectedness as a cornerstone of its economic development strategy.11The Netherlands earned its second-place rank on the index based on its combined strength across the depth and breadth dimensions(ranking 6th on depth and 3rd on breadth).The Netherlands unique combination of geogra

159、phy,regional integration with its neighbors,domestic market attractive-ness,and long tradition of international openness have made it a consistent leader in global connectedness.The next three countries in the rankingIreland,Luxembourg,and Maltaall ranked higher on depth than breadth,like Singapore.

160、The United Kingdom was the highest-ranked country in terms of breadth.It ranked 9th overall,but only 30th on depth.The UK has a long history of global reach,having colonial ties to over 80 countries.12 Its integration with its European neighbors,coupled with strong ties to the U.S.,make it a natural

161、 top performer on breadth,since those economies are among the largest partners for most international flows.While there is strong evidence that the UKs exit from the EU has reduced its international flows,some of the UKs key glo-balization metrics rebounded in 2022.13It is important to note that not

162、 all countries have the same international opportunities.Five structural characteristics of countriesGDP per capita,population,proximity to interna-tional markets,whether they share an official language with other countries,and whether they are landlockedexplain over 70%of the variation in countries

163、 levels of global con-nectedness.14 Thus,comparisons are best made between similar countries along these dimensions.Likewise,from a policy perspective,it is important to adopt approaches that are tailored to a countrys unique international opportunities and challenges.THE WORLDS 10 LARGEST ECONOMIES

164、While the worlds largest economies exert a powerful influence on worldwide patterns of activity,they are not usually among the most globalized countries.Countries that rank highly on the DHL Global Connectedness Index combine both large international flows relative to domes-tic activity(high depth)a

165、nd globally distributed flows(high breadth).While large economies often have high breadth,they tend to have low depth because of their large internal markets.The United States,for example,ranks 44th overall.Because of the wide reach of its inter-national flows,it ranks 2nd worldwide on breadth.But t

166、hese international flows are small in relation to domestic activity,which is why it ranks only 122nd out of 181 coun-tries on depth.Similarly,Chinas 80th rank overall reflects a much higher rank on breadth(23rd)than depth(171st).The worlds 10 largest economies,ranked by current GDP at market exchang

167、e rates,placed as follows on the DHL Global Connectedness Index:Change 2017 to 2022GDP Rank CountryScoreRankScore1.44United States57-1002.80China50-10-13.50Japan55-1+14.13Germany64+1+25.62India52+1+16.9United Kingdom69-1+27.23France61-2+18.91Russian Federation49-31-39.29Canada590+110.36Italy58+3+222

168、2.Globalization Snapshot and Country Rankings INCREASES AND DECREASES IN COUNTRIES GLOBAL CONNECTEDNESSTables 2.2 and 2.3 identify the countries with the largest connectedness score increases and decreases over various periods.In the most recent year covered in our full country-level analysis,2022,t

169、here were increases in 143 countries connectedness scores and declines for only 38 countries.This provides yet another indication of the resilience of global flowsthe gains we have already reported were widespread across countries and not just the result of a small number of large countries becoming

170、 more globally connected.Since 2021Score ChangeSince 2017Score ChangeSince 2001Score Change1.Bahrain+3.01.Libya+6.31.United Arab Emirates+13.12.United Kingdom+2.52.Guyana+4.72.Malta+11.13.Lebanon+2.53.Estonia+4.23.Djibouti+10.34.Sweden+2.14.Portugal+3.84.Slovenia+9.25.Portugal+2.05.North Macedonia+3

171、.75.Mozambique+9.26.Denmark+2.06.Greece+3.76.Singapore+9.07.Armenia+2.07.Lithuania+3.67.Netherlands+8.78.Hungary+1.98.United Arab Emirates+3.58.Cyprus+8.19.Jordan+1.99.Serbia+3.39.Georgia+7.810.Lithuania+1.810.Denmark+3.210.Qatar+7.72.Globalization Snapshot and Country Rankings23TABLE 2.2:LARGEST IN

172、CREASESSince 2021Score ChangeSince 2017Score ChangeSince 2001Score Change1.Belarus-3.31.Azerbaijan-3.81.Angola-5.82.Russian Federation-2.92.So Tom and Prncipe-3.32.Yemen-5.43.Luxembourg-2.63.Luxembourg-3.33.Papua New Guinea-5.44.Papua New Guinea-1.54.St.Lucia-3.24.Belarus-3.95.Liberia-1.45.Russian F

173、ederation-3.25.Venezuela-3.86.Marshall Islands-1.36.Belarus-3.06.Eswatini-2.67.Namibia-1.17.Kiribati-2.87.Zimbabwe-2.58.Sudan-1.08.Hong Kong SAR,China-2.58.Andorra-2.49.Niger-0.89.Marshall Islands-2.39.Antigua and Barbuda-2.210.Seychelles-0.710.Guinea-2.310.Russian Federation-1.7242.Globalization Sn

174、apshot and Country Rankings TABLE 2.3:LARGEST DECREASESThe most dramatic shifts in the country-level results from 2021 to 2022,however,involved declines rather than increases.15 The largest declines were posted by Belarus and Russia,due to the major disruptions to their international flows that foll

175、owed Russias invasion of Ukraine and subse-quent sanctions.Russias 2.9-point decline was especially striking.This was more than twice as large as any previous decline for a country that ranks among the worlds 20 largest economies(considering data extending back to 2001).16 The declines and geographi

176、c shifts in Russias and Belaruss inter-national flows were widespread across types of international activity(we return to the topic of Russias flows in Section 4).Luxembourg posted the third largest decline in 2022.This was due to a one-off financial transaction and is not reflec-tive of a meaningfu

177、l reduction in the connectedness of Lux-embourgs real economy.Luxembourg reported very large negative FDI flows in 2022(both inward and outward)due to the restructuring of a telecommunications holding company,which caused a large decline in Luxembourgs score on the capital pillar of the index.17 Lux

178、embourgs results on mea-sures that are not affected by such pass-through(“conduit”)capital flows remained strong.The countries with the largest increases in 2022 were Bah-rain,the United Kingdom,and Lebanon.The key factors in Bahrains growing connectedness were increases in both merchandise exports

179、and inward M&A activity.Bahrain has long sought to boost international business activity as part of its economic development strategy.18 The United King-doms gains were due to trade growth across both goods and services,along with an increase in announced greenfield FDI.These increases,however,follo

180、wed several years dur-ing which the United Kingdom lagged behind peer countries in the growth of global flowsa pattern widely attributed to frictions induced by the UKs withdrawal from the EU.19 Lebanons gains came as the countrys economy stabilized somewhat after a collapse during the prior year.Wh

181、ile the countrys challenges continued,there was a recovery in Leb-anons merchandise imports and outbound M&A activity.20 Changes over longer periods highlight some of the key factors that influence countries global connectedness,as illustrated in Figure 2.6.21 Peace and security is a key foun-dation

182、 without which international connections are severely impaired.Several of the long-term increases and decreases follow the escalation and de-escalation of violent conflicts.For example,the largest increase over the five years since 2.Globalization Snapshot and Country Rankings25FIGURE 2.6:FIVE KEY P

183、OLICY FACTORS FOR GLOBAL CONNECTEDNESS Peace and security and the domestic business environment form a founda-tion upon which international openness,regional integration,and public support can also boost global connectedness.1.Peace and Security2.Domestic Business Environment3.International Openness

184、4.Regional Integration5.Public SupportOur 2021 special report,Connecting to the World:Lessons from 10 Years of the DHL Global Connectedness Index,examines long-run patterns in global con-nectedness scores and discusses public policy implications.STEVEN A.ALTMAN AND CAROLINE R.BASTIANCONNECTING TO TH

185、E WORLD Lessons from 10 Years of the DHL Global Connectedness Index In partnership with2017,in Libya,followed a recovery in international flows as security improved.Likewise,several of the largest decreases(including Yemens,the second-largest decrease since 2001)were driven by worsening security con

186、ditions.Others high-light the effects of international sanctions,such as those imposed on Belarus,Russia,and Venezuela.With a basic level of security in place,countries can boost their engagement with globalization via improvements to both their domestic business environments and their poli-cies aff

187、ecting openness to international flows.Several of the countries with the largest increases in connectedness embraced policies addressing both domestic attractiveness and international openness.For example,the United Arab Emirates,the country with the largest increase since 2001,substantially increas

188、ed its global connectedness via a mul-tifaceted economic development strategy spanning areas such as international shipping,air connections,tourism,and finance,supported by the development of free zones and extensive employment of foreign labor and capital.Several of the same strategies were also em

189、braced by neighbor-ing Qatar,propelling its rise in the global connectedness rankings.Regional integration is also a powerful enabler of global connectedness,and several of the countries with the larg-est increases in connectedness have boosted their regional integration.For example,Malta,the countr

190、y with the second-largest increase since 2001 joined the EU in 2004 and posted large increases in its services trade in the years leading up to its EU accession.Cyprus,Estonia,Lithuania,and Slovenia also joined the EU in 2004.Georgia,North Macedonia,and Serbia executed trade agreements with the EU a

191、nd are now candidate countries.22 Singapore is a participant in ASEAN,as well as both the Comprehensive and Progressive Agreement for Trans-Pacific Partnership(CPTPP)and the Regional Com-prehensive Economic Partnership(RCEP).262.Globalization Snapshot and Country Rankings GLOBALIZATION AND MAJOR WOR

192、LD REGIONSThere are large differences in levels of global connectedness across major world regions.These take on special signifi-cance,since close to half of all international activity happens within rather than between regions,as seen in Figure 2.4 (p.17).Figure 2.7 displays average global connecte

193、dness,depth,and breadth scores across the countries in each region(using the region classification reported in Table A.4 in the Appen-dix).In terms of overall global connectedness,countries in Europe average the highest levels,followed by those in North America.Middle East&North Africa and East Asia

194、&Pacific rank third and fourth.All of these regions lie above the world average.South&Central America&Caribbean,South&Central Asia,and Sub-Saharan Africa lie below the world average.Consistent with patterns described in the previous section,wealthier regions show higher levels of global connected-ne

195、ss than poorer ones.Countries in the four most connected regions average almost six times the GDP per capita of coun-tries in the three least connected regions.FIGURE 2.7 AVERAGE OVERALL GLOBAL CONNECTEDNESS,DEPTH,AND BREADTH SCORES BY REGION,20222.Globalization Snapshot and Country Rankings27Countr

196、ies in Europe average the highest levels of overall global connectedness,followed by North America and Middle East&North Africa.0 10 20 30 40 50 60 700 10 20 30 40 50 60 700 10 20 30 40 50 60 70EuropeNorth AmericaMiddle East&N.AfricaEast Asia&PacificS.&C.America,Caribbean South&Central AsiaSub-Sahar

197、an AfricaNorth AmericaEuropeMiddle East&N.AfricaEast Asia&PacificSouth&Central AsiaS.&C.America,Caribbean Sub-Saharan AfricaEuropeMiddle East&N.AfricaEast Asia&PacificS.&C.America,CaribbeanNorth AmericaSouth&Central AsiaSub-Saharan AfricaGlobal ConnectednessBreadthDepthEuropes standing as the worlds

198、 most globally connected region reflects both its structural characteristics(many wealthy countries in close proximity)as well as decades of policy initiatives aimed at promoting integration via the Euro-pean Union(EU)and predecessors such as the European Eco-nomic Community(EEC).Europes strength ac

199、ross the four pillars of the DHL Global Connectedness Index is supported by the pillars close correspondence to core principles of the EU.Three pillars(trade,capital,and people)are addressed directly by the EUs“four freedoms”the free movement of goods,capital,services,and people.23 The remaining pil

200、lar,information,is addressed in part by the EUs Copenhagen Criteria for accession to the Union,based on which“the EU makes press freedom one of the criteria for accession.”24While North America ranks second in overall connected-ness,its high rank is due primarily to the breadth of its international

201、flows.Looking at depth alone,North Amer-icas rank drops from second to fifth,while on breadth alone,North America moves up to the top rank.North Americas high breadth and low depth reflects the fact that this region is comprised of three economies that all rank among the worlds largest.Based on 2022

202、 GDP in current U.S.dollars,the U.S.is the worlds largest econ-omy,Canada is the ninth largest,and Mexico the 14th.25 The Middle East&North Africa region contains a diverse set of economies,many of which invite superlatives.The wealthy Gulf states are well-connected to much of the rest of the world,

203、not only through trade,but also investment,immigra-tion,and tourism.North African countries are relatively well connected with Europe,which is geographically close.Figure 2.8 shows average scores for the trade,capital,infor-mation,and people pillars of the index by region.Europe leads on trade and p

204、eople flows,while North America leads on capital and information flows.Middle East&North Africa ranks second on trade,reflecting both the importance of the oil trade and the close ties many of these countries have to Europe.Both South&Central America and the Caribbean and South&Central Asia rank bel

205、ow average,and Sub-Saharan Africa ranks last on all four pillars.282.Globalization Snapshot and Country Rankings FIGURE 2.8.AVERAGE TRADE,CAPITAL,INFORMATION,AND PEOPLE PILLAR SCORES BY REGION,2022 2.Globalization Snapshot and Country Rankings29Europe is the top-ranked region on trade and people flo

206、ws,while North America leads on capital and information flows.0 10 20 30 40 50 60 700 10 20 30 40 50 60 700 10 20 30 40 50 60 700 10 20 30 40 50 60 70EuropeMiddle East&N.AfricaEast Asia&PacificNorth AmericaS.&C.America,Caribbean South&Central AsiaSub-Saharan AfricaEuropeNorth AmericaMiddle East&N.Af

207、ricaEast Asia&PacificSouth&Central AsiaS.&C.America,Caribbean Sub-Saharan AfricaNorth AmericaEuropeEast Asia&PacificMiddle East&N.AfricaSouth&Central AsiaS.&C.America,Caribbean Sub-Saharan AfricaNorth AmericaEuropeEast Asia&PacificMiddle East&N.AfricaS.&C.America,CaribbeanSouth&Central AsiaSub-Sahar

208、an AfricaTradePeopleInformationCapital055Outward (%of total outward flows)055Inward (%of total inward flows)Europe05101520 drawtuO05101520 drawnIcificaP&aisA tsaE051015 drawtuO051015 drawnIaciremA htroN0505 S&CA0505 MENA00SCAC00SSA302.Globalization Snapshot and Country Rankings

209、 ABOUT THIS VISUALIZATION nEach connection within the circle represents a flow between one region and another.The lines thick-ness is proportional to the magnitude of that flow.nEach regions flows are divided into outward and inward directions.nThe color of each flow depends on its origin region.Eac

210、h regions outward flows are a single color.A regions inward flows are multicolored,represent-ing the regions from which it receives flows.One can trace the share of inward flows to a region by identifying the magnitude of that flow relative to all flows.For instance,flows from East Asia&Pacific to E

211、urope represent about 4%of the worlds total flows.This is because the blue line stretching from East Asia&Pacifics outward arc to Europes inward arc is approxi-mately four tick marks thick.Intraregional flows are represented by a line stretching from the outward arc to the inward arc of the same reg

212、ion.Europes flows to itself make up 24%of the worlds total flows.Outward flows can be understood in a parallel fashion using the narrow multicolored arc outside of the indented area where each regions outward flows begin.FIGURE 2.9:AGGREGATE GLOBAL FLOWS BY REGION,2022S&CA=South&Central Asia MENA=Mi

213、ddle East&North Africa SCAC=South&Central America&CaribbeanSSA=Sub-Saharan AfricaTo conclude our examination of global flows at the level of major world regions,Figure 2.9 provides a summary of the combined trade,capital,information,and people flows that take place within and between each of the reg

214、ions.More than three-quarters of the worlds international flows touch the three largest regions.Europe has the largest total flows,followed by East Asia&Pacific,and then North America.Intra-regional flows feature very prominently,with 24%of the worlds total flows taking place inside Europe and 13%ha

215、ppening inside the East Asia&Pacific region.26 In summary,the overall development of international flows strongly rebuts the notion that globalization has gone into reverse.The DHL Global Connectedness Index depth score hit a new record in 2022,and currently available data suggest that it remained c

216、lose to that level in 2023.While countries at the center of current geopolitical conflicts do show major changes in their flow patterns,there is still not a general trend of global flows breaking down along geopolitical or regional lines.This means that countries continue to have large opportunities

217、 for international exchange.At the coun-try level,far more countries saw their levels of con-nectedness increase than decrease in 2022.Singapore ranked as the worlds most globally connected country,followed by the Netherlands and Ireland.Bahrain and the United Kingdom recorded the largest gains,whil

218、e Belarus and Russia had the largest declines.Europe is the worlds most globally connected region,followed by North America and the Middle East&North Africa.2.Globalization Snapshot and Country Rankings313.ARE GLOBAL FLOWS STILL GROWING?This section examines the growth of international flows relativ

219、e to domestic activity,tracking a wide variety of trade,capital,information and people flows.In most areas,the growth of international flows is keeping up with or even exceeding the growth of domestic activity.TRADEIn the previous section we saw that summary-level mea-sures of the growth of internat

220、ional flows show no sus-tained retreat from international to domestic activity.To the contrary,international flows have proven highly resilient through multiple waves of shocks.Here,we delve deeper into the internationalization of specific types of activity,starting with trade.The value of global ex

221、ports of goods and services as a percentage of world GDP(see Figure 3.1)is the most widely watched measure of globalization.This ratio had declined in the years following the 2008 global financial crisis,prompting a wave of speculation about globalization going into reverse.But after dropping at the

222、 beginning of the Covid-19 pandemic in early 2020,it rebounded swiftly and rose back to a record high level in 2022.The fact that the global exports-to-GDP ratio bounced back to a record high underscores the resilience of international trade.Moreover,current forecasts indicate that this ratio will r

223、emain close to its peak level in 2023 and 2024,even after some softening of commodity prices(high commodity prices boosted trade values in 2022).The global exports-to-GDP ratio provides a rough indication of the contribution of trade to the world econ-omy by comparing the value of goods and services

224、 traded internationally to the value of global economic output.However,this ratio does have important limitations.Output that crosses more than one border in a multi-country value chain is counted more than once(see Gross versus Value Added Trade Mea-sures on p.36).The global exports-to-GDP ratio is

225、 also sensitive to commodity prices.Falling commodity prices played an important role in its decline after the 2008 global financial crisis,and rising commodity prices con-tributed to its increase in 2022.3.Are Global Flows Still Growing?33The most widely watched measure of globalization,the global

226、exports-to-GDP ratio,returned to a record high level in 2022,and it is forecast to remain close to that level in 2023 and 2024.Data Sources:World Bank World Development Indicators,IMF World Economic Outlook October 2023FIGURE 3.1:WORLD EXPORTS OF GOODS AND SERVICES(%OF GDP),19902024(FORECAST)TotalGo

227、odsServices35%30%25%20%15%10%5%0%90 92 94 96 98 00 02 04 06 08 10 12 14 16 18 20 22 24 During the Covid-19 pandemic,shifts in consumption from local services to traded goods,supported by fiscal and mon-etary stimulus programs,boosted trade growth,even as the pandemic exacerbated supply constraints.T

228、hen,during the first year of the war in Ukraine,many countries were able to quickly substitute alternative sources of supply when access to their traditional sources was disrupted.1 This rapid substi-tution of import sources helped prevent many of the severe commodity shortages that were predicted d

229、uring the early stages of the war.2 More sophisticated measures of trade integration rein-force the finding that trade is resilient,and that concerns about declines in the exports-to-GDP ratio after the 2008 global financial crisis were overblown.A key factor behind that decline was a drop in the pr

230、ices of some heavily traded commodities.Without price changes,the post-crisis decline was much smaller.3 Shifts in the composition of economic activity across countriesand the development of domestic supply chains in Chinaalso played large roles in reduc-ing trade intensity after the financial crisi

231、s.4 Outside of China,measures of the reliance of production on imported inputs have held steady or continued to rise after the global financial crisis.5 Moreover,other measures of international value chains also contradict the notion of a general shift from international to domestic production.An an

232、alysis of the number of domestic versus foreign production stages in multi-country value chains shows no shift to more domestic production stages in the years following the financial crisis.6 Even more recent data show that worldwide participation in global value chains rose to a record high level i

233、n 2022(mea-sured based on the share of trade crossing more than one border in a multi-country value chain).7 Measures specifi-cally focused on international versus domestic sourcing of manufactured inputs do show some declines between 2012 and 2020,but even those declines are small compared to the i

234、ncreases recorded since 1995.8In late 2022,nonetheless,merchandise trade volumes did fall(see Figure 3.2),leading to a slowdown in the annual growth of trade in goods and services.Global trade volume growth slowed sharply from 5.2%in 2022 to only 0.4%in 2023,as shown in Figure 3.3.9 The most importa

235、nt rea-son for the slowdown was weaker global macroeconomic growth,with many countries having raised interest rates to curb inflation.When global growth slows,trade tends to slow even more than GDP,because sales of heavily-traded product categories such as durable goods and capital equip-ment are es

236、pecially sensitive to business cycles(and com-modity prices also tend to dip during global downturns).The strength of the U.S.dollar relative to other currencies may have also contributed to the trade growth slowdown in 2023.10 Figure 3.2 shows how much moreor lessgoods were traded interna-tionally

237、in each month as compared to the amount traded in December 2019.Seasonal differences in trade volumes,as well as price changes,are removed from these statistics to paint the clearest possible picture of real trends in the amount of goods traded.343.Are Global Flows Still Growing?Trade in goods stage

238、d an unprecedented collapse and rebound during the Covid-19 pandemic,after which trade volumes weakened in late 2022 and remained below peak levels in 2023.Data Source:CPB World Trade Monitor November 2023(data released January 2024)FIGURE 3.2:WORLD MERCHANDISE TRADE VOLUME(SEASONALLY ADJUSTED CHANG

239、E VS.DECEMBER 2019)15%10%5%0%-5%-10%-15%-20%2020202120222023J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O NLooking forward,the IMF forecasts a rebound in global trade volume growth to 3.3%in 2024,which is higher than the 3.1%global GDP growth forecast fo

240、r the same year.This is consistent with longer-term forecasts that show no signs of trade becoming a less important part of the world economy.11 The IMF forecast also implies that trade growth will return in 2024 to its average pace during the years pre-ceding the Covid-19 pandemic(trade growth aver

241、aged 3.3%between 2012 and 2019).12 The public policy context for trade,nonetheless,remains less supportive than it was a decade ago.Figure 3.4 high-lights how the average countrys policy openness to trade,measured based on both tariffs and non-tariff trade barriers,started to decline in 2019.New res

242、earch also deemed 71%of industrial policy actions introduced in 2023 to be trade distorting,with corporate subsidies being the most common type of trade distorting policy.13Uncertainty about future trade policies and other potential disruptions has also contributed to a less favorable policy context

243、 for trade.One study shows uncertainty as the larg-est driver of a recent increase in trade costs.14 This coincides with a deterioration of the institutional architecture for resolving trade disputes.The World Trade Organizations appellate body has been unable to function since December 2019,and U.S

244、.officials continue to block all new appoint-ments to it.15 It is also important to keep in mind that even as the role of international trade in the world economy remains close to an all-time high,it is still far smaller than it could potentially become.In a hypothetical world where buyers are equal

245、ly likely to source goods and services from domestic or for-eign sourceswhere borders and distance no longer mat-tertrade would theoretically grow to almost 90%of world GDP.16 But in reality,trade(measured in“value added”terms)amounts to only about 20%of world GDP.17 3.Are Global Flows Still Growing

246、?35Trade growth is forecast to modestly exceed GDP growth in 2024 and 2025,after falling well behind GDP growth in 2023.Data Source:IMF World Economic Outlook,October 2023 and January 2024FIGURE 3.3:GLOBAL ANNUAL TRADE AND GDP GROWTHA wave of trade liberalization lost momentum during the 2008-09 glo

247、bal financial crisis,and recent data on tariffs and non-tariff barriers to trade indicate that a turn toward more protectionist policies began in 2019.Data Source:Heritage Foundation Index of Economic FreedomFIGURE 3.4:HERITAGE FOUNDATION TRADE FREEDOM INDEX,565554595 97 99 01 03 05 07 09

248、 11 13 15 17 19 21 2315%10%5%0%-5%-10%18 19 20 21 22 23 24 25Trade Volume GrowthReal GDP GrowthMeasuring trade in value added terms also helps clarify how trade intensity varies across industry sectors.In Fig-ure3.5,the width of the bars represents each sectors share of the world economy,and the hei

249、ght of the bars shows the percent of the value produced by that sector that ultimately ends up in a different country.The commodities(including energy resources)extracted by the mining sector are traded most intensively,with about 53%of value ending up in a different country from where it was produc

250、ed.In all other sectors,domestic activity is predominant.The sector with the second highest trade intensity is manufacturing(33%).Industries that produce services rather than goods typi-cally have much lower levels of trade intensity.On average,only 14%of value generated in the services sector is tr

251、aded internationally.Services trade,nonetheless,has continued to intensify over the past decade and a half,even when goods trade intensity weakened.There was a decline in services trade intensity during the pandemic,but this was due entirely to the collapse of international travel and related servic

252、es.Trade in other types of services continued growing.As shown in Figure 3.6,the growth of digitally delivered services accelerated during the pandemic,and travel was the only services category that remained below its pre-pandemic level in 2022.One of the contributors to the recent growth GROSS VERS

253、US VALUE ADDED TRADE MEASURESMost trade statistics are reported in“gross”terms,which means that they simply indicate the values of the goods and services that were recorded each time they crossed a national border.In value chains that span multiple countries,these“gross”statistics can count the same

254、 good or service multiple times.For example,if a camera sensor in a mobile phone is exported from Japan to China,and then the phone is exported from China to the United States,the value of the camera sensor is counted twice,overstating the actual amount of the value of the phone that was traded inte

255、r-nationally.Trade statistics calculated in value added terms address this issue by counting the value traded only once,regardless of how many times it crosses a national border.Thus,value added trade statistics present a more accurate picture of how much of the worlds economic output ends up in a d

256、ifferent country from where it was produced.This graph provides a snapshot of the entire world economy,high-lighting how the intensity of international trade varies across sectors.The width of the bars represents the size of each sec-tor according to its share of the total value produced around the

257、world.The sectors are ordered from largest to smallest.The height of the bars repre-sents the share of their output that is traded internationally,measured accord-ing to the share of the value produced in each sector that ultimately ends up in a different country from where it was produced.363.Are G

258、lobal Flows Still Growing?About 20%of global economic output ends up in a different country from where it was produced,but there is wide variation across industry sectors.Trade intensity is highest in the mining industry,and generally higher in goods-producing sectors than in the services sector.Dat

259、a Source:OECD TiVA DatabaseFIGURE 3.5:EXPORT INTENSITY BY SECTOR(VALUE ADDED),202060%40%20%0%0%20%40%60%80%100%Exports Share of Value AddedComposition of Global Value AddedPublic Svcs.(Public Administration,Education,Defense,Arts/Entertainment,etc.)Distribution Svcs.(Wholesale,Retail,Transportation,

260、Accommodation,Food Svcs.,etc.)ManufacturingReal EstateOther Business Svcs.Financial Svcs.ConstructionInfo&Comm Svcs.AgricultureMiningUtilities33%5%24%25%2%18%2%20%15%15%53%of digitally delivered services has been the growth of cross-border e-commerce,which has accelerated the growth of trade in both

261、 goods and services(see the box titled The Rise of Cross-Border E-Commerce).THE RISE OF CROSS-BORDER E-COMMERCEMost e-commerce sales take place within rather than across national borders.Globally,UNCTAD estimated that 9%of business-to-consumer(B2C)e-commerce sales were cross-border in 2019,and McKin

262、sey pegged the cross-border share of e-commerce at 11%in 2020.18 Among companies engaged in cross-border e-commerce,however,the share of sales generated internationally was higher,reaching 28%according to a 2023 survey.19 Forecasts call for rapid cross-border e-commerce growth moving forward,with cr

263、oss-border sales grow-ing much faster than domestic sales.Juniper Research predicts that cross-border e-commerce transaction values will grow at a 16%annualized rate from 2023 to 2028,as compared to 8%for domestic sales.20 Statista forecasts an even faster(29%)growth rate for business-to-consumer cr

264、oss-border e-commerce sales from 2021 to 2030.21 A 2023 survey of logistics ser-vice providers,manufacturers,and retailers reinforces expectations for strong cross-border e-commerce growth:77%expected growth over the next 24 months,as compared to only 3%predicting declines.22 The rise of cross-borde

265、r e-commerce has been shown to accelerate trade growth and to broaden access to international markets,making trade more inclusive.Studies of both countries and companies show posi-tive effects of e-commerce adoption on trade growth.23 Moreover,cross-border e-commerce lowers barriers to trade for sma

266、ller companies,and there is extensive evidence of higher participation by women in trade via digital platforms.24 Cross-border e-commerce has also led to an increase in small international shipments,reducing the aver-age value per international transaction.This has placed a premium on countries abil

267、ity to efficiently process these shipments,linking e-commerce growth to broader trade facilitation agendas.25 A surge of e-commerce imports into the U.S.from China,however,could lead to changes in a key policy designed to facilitate such trade.Legislation was proposed in the U.S.in mid-2023 that,if

268、adopted,would bar“non-market economies”(including China)from eligibility for shipments valued at less than$800 to enter the U.S.duty-free.26 This could have a sub-stantial effect,because roughly 60%of such“de minimis”shipments entering the U.S.in 2021 came from China.27 3.Are Global Flows Still Grow

269、ing?37The decline in services exports during the Covid-19 pandemic was due to the collapse of international travel and a related decline for international transportation services.The growth of digital services exports surged during the pandemic.Note:Digitally delivered services were classified using

270、 EBOPS 2010 codes SF,SG,SH,SI,SJ1,SJ2,SJ3,SI1,and SK,which include financial and insurance services,charges for intellectual property,various types of business services,and cultural services(such as audiovisual content).Data Source:World Trade OrganizationFIGURE 3.6:SERVICES EXPORTS BY CATEGORY (TRI

271、LLIONS OF U.S.DOLLARS)87654321012 13 14 15 16 17 18 19 20 21 22DigitalOtherTransport TravelCAPITALThe data on trade show that recent shocks to the global economy have not caused a broad shift from international to domestic business activity.Data on international capital flows reinforce this conclusi

272、on.In fact,recent disruptions have caused some aspects of international investment to increase,with large amounts of capital being deployed to boost resilience to potential future shocks.Figure 3.7 depicts trends for each of the components of the capital pillar of the DHL Global Connectedness Index:

273、announced greenfield foreign direct investment(FDI)projects,interna-tional M&A transactions,FDI flows and stocks,and portfolio equity investment stocks.New announcements of greenfield FDI projects provide a forward-looking perspective on international business investment,since they track announced p

274、lans to build or expand companies foreign operations.The estimated value of announced greenfield FDI projects,measured relative to world GDP,rose sharply in 2022,and preliminary data sug-gest another smaller increase in 2023(to the highest level in more than a decade).The number of greenfield FDI pr

275、ojects,however,grew more slowly than their value in 2022 and declined modestly in 2023,highlighting the outsized role of large investments in the recent growth trend.28 The UN Conference on Trade and Development(UNCTAD)reports that some of the largest increases in greenfield investment in 2023 were

276、in“global value chain-intensive sectors,”such as the automotive,textile,machinery,and electronics industries.29 In 2022,greenfield investment in the semiconductor industry boomed,as companies responded to public policy measures aiming to diversify production and prevent a repeat of Covid-era shortag

277、es.A focus on securing access to key energy and other resources following disrup-tions due to the war in Ukraine also boosted international investment in extractive industries in 2022.30 Cross-border merger and acquisition(M&A)transactions reflect another way that companies can grow their interna-ti

278、onal operations.The share of M&A transactions that involve buyers and sellers in different countries has remained fairly stable for more than two decades.Currently available data indicate that 29%of M&A transactions were international in 2023,exactly the same as the average share since 2001.Firms ha

279、ve not generally become less keen on acquiring for-eign relative to domestic companies.31 FDI flows include the value of greenfield FDI and cross-border M&A transactions,along with earnings companies reinvest abroad and some types of inter-company loans.32 Thus,FDI flows provide a broaderbut noisier

280、indicator of international business investment.FDI flows have shown notable weakness in recent years.Since 2001,FDI inflows have averaged 8%of global gross fixed capital formation,but this ratio has remained below that level every year since 2017.Currently available data indicate that it held steady

281、 at 5%from 2022 to 2023.While the intensity of global FDI flows remains well below the all-time high set in 2000(and more recent peaks in 2007 and 2015),there are several reasons why recent declines should not be over-emphasized in assessing the state of globalization.First,FDI flows tend to be vola

282、tile,spiking during international M&A waves,so declines from any given peak must be interpreted with caution.Second,FDI trend data can be skewed by financial transactions that do not reflect meaningful changes in the real operations or financial exposures of international firms or investors.Many of

283、these financial flows are motivated by tax policies.The 2015 peak was boosted by a wave of U.S.“corporate inversions,”and FDI flows in more recent years were depressed by policies aimed at reducing tax-motivated financial flows.The 2022 value was reduced by the financial restructuring of a Luxem-bou

284、rg-based telecommunications holding company.Third,FDI flows miss international business expansions in which 383.Are Global Flows Still Growing?multinational firms secure local financing abroad.33 And fourth,FDI flows data do not reflect the increasingly preva-lent activity of“digital”multinationals

285、doing large amounts of business in foreign countries without investing in physical assets in those countries.34 Several other indicators of corporate globalization reinforce the conclusion that there has been no widespread pullback from international business activity.The next component of the DHL G

286、lobal Connectedness Index capital pillar,FDI stocks,reflects the value of multinational firms cumulative 3.Are Global Flows Still Growing?39The intensity of international capital flows is highly volatile,and trend directions vary across indicators.The intensity of announced greenfield FDI,announced

287、M&A transactions,and portfolio equity stocks shows neither a clear rising trend nor a clear falling trend.The intensity of FDI flows shows a falling trend,while the intensity of FDI stocks was on a rising trend through 2020.Data Sources:Financial Times fDi Markets,LSEG SDC Platinum,UNCTAD World Inve

288、stment Report,IMF Coordinated Portfolio Investment Survey,World Bank World Development Indicators,Bloomberg,Euromonitor Passport Database,World Federation of ExchangesFIGURE 3.7:CAPITAL PILLAR DEPTH INDICATORS2.5%2.0%1.5%1.0%0.5%0.0%60%50%40%30%20%10%0%45%40%35%30%25%20%15%10%5%0%35%30%25%20%15%10%5

289、%0%16%14%12%10%8%6%4%2%0%03 05 07 09 11 13 15 17 19 21 2301 04 07 10 13 16 19 2201 04 07 10 13 16 19 2201 03 05 07 09 11 13 15 17 19 21 2301 03 05 07 09 11 13 15 17 19 21 23Announced Greenfield FDI(%of GDP)FDI Stocks(%of GDP)Portfolio Equity Stocks (%of Market Capitalization)Announced M&A Transactio

290、ns(%Intl)FDI Inflows(%of GFCF)investments over time in their foreign operations.The value of FDI stocks relative to world GDP rose sharply in the years before the Covid-19 pandemic and remains close to a record high.Additionally,Figure 3.8 reports trends for three other indica-tors of corporate glob

291、alization that were not included in the DHL Global Connectedness Index due to data limitations.The share of global output produced by the foreign opera-tions of multinational firms is roughly as high as it has ever been,although this measure has not increased appreciably since 2007.The share of the

292、worlds working age population employed in the foreign operations of multinational firms has risen substantially over the past three decades and remains close to a record high.And publicly traded firms in most countries have increased the share of their sales generated in foreign markets.Morningstar

293、reports that across 45 coun-tries,the companies included in equity market indexes in 31 countries(including large markets such as the U.S.,UK,and Japan)derived a higher share of their revenues from foreign countries in 2023 than in 2019.35Looking beyond capital flows related to the globalization of

294、firms,the DHL Global Connectedness Index also tracks portfolio equity investment,which reflects holdings of less than 10%of the shares in a foreign company(above 10%,the investment is classified as FDI because the investor is pre-sumed to have significant influence over the management of the foreign

295、 enterprise).As shown in Figure 3.7,after a long rising trend,the stock of portfolio equity investment assets(relative to world stock market capitalization)has remained fairly stable over the past decade.403.Are Global Flows Still Growing?Additional indicators of corporate globalization reinforce th

296、e view that firms are not generally retreating from international markets.The share of rev-enues public companies earn abroad has been rising in most markets,and the shares of output and employment in the foreign affiliates of multinational firms are close to record high levels.Data Sources:UNCTAD W

297、orld Investment Report,OECD Analytical AMNE Database,Dan Lefkovitz,“Equity Markets Grow Ever More Global,”Morningstar,July 11,2023FIGURE 3.8:OTHER INDICATORS OF CORPORATE GLOBALIZATIONU.S.JapanUK01 03 05 07 09 11 13 15 17 19MNE Foreign Affiliate Emplyment (%of World Working Age Population)MNE Foreig

298、n Affiliates Output (%of Total World Output)Listed Companies Foreign Revenue Shares (Example Countries)2.0%1.8%1.6%1.4%1.2%1.0%0.8%0.6%0.4%0.2%0.0%90%80%70%60%50%40%30%20%10%0%18%16%14%12%10%8%6%4%2%0%90 95 00 05 10 15 2020192023INFORMATIONAmong all aspects of globalization covered by the DHL Global

299、 Connectedness Index,information flows saw the larg-est increases over the past two decades.However,the latest data show declines on some indicators,raising questions about future prospects for the globalization of information flows.The amount of data crossing national borders over the inter-net has

300、 nearly tripled since 2019,fueling dramatic increases in international information flows.36 As shown in Figure 3.9,the annual growth rate of international internet traffic surged at the beginning of the Covid-19 pandemic and has continued at greater than 20%through 2023.37 Data flows,however,have su

301、rged both within and between countries,so the growth of international internet traffic does not itself demonstrate an increase in the internationalization of information flows.In fact,a McKinsey&Company study reported that the cross-border share of data flows fell 2%in 2022,after having grown substa

302、ntially since 2012.38 The DHL Global Connectedness Index relies on three indica-tors for analyzing information pillar global trends:scientific research collaboration,royalty charges for the use of intel-lectual property from other countries,and international patenting(see Figure 3.10).The mixed resu

303、lts across these indicators suggest that the long-term growth trend in the internationalization of information flows has faltered.International scientific research collaboration has increased dramatically over the past two decades.39 The pro-portion of scholarly articles with coauthors located in mo

304、re than one country rose from 18%in 2001 to 28%in 2020,before slipping back to 26%by 2023.40 The growing scien-tific capacity of developing countries,along with improve-ments in online collaboration tools,fueled the expansion of research collaboration.41Since 2020,the modest decline was due,in part,

305、to a reduc-tion in research collaboration between the U.S.and China,the countries with the largest output of scientific publica-tions.We revisit this topic and consider the influence of geo-political tensions in Section 4.Data on charges for the use of foreign intellectual property also show a long-

306、term rising trend,followed by a small decline.International charges for the use of intellectual property grew from 0.23%of world GDP in 2001 to a peak of 0.51%in 2021,before slipping back to 0.49%in 2022.This suggests a substantial expansion of licensing as a mode of international business activity.

307、It remains to be seen whether the small decline in 2022 represents merely a pause or the beginning of a reversal of this long-term rising trend.423.Are Global Flows Still Growing?41The growth rate of international internet traffic roughly doubled in 2020,as the Covid-19 pandemic caused many types of

308、 in-person interactions to transition online.This was,however,a one-time spike,after which growth continued roughly in-line with pre-pandemic trends.Data Sources:TeleGeography IP Networks Executive Summary 2023;Paul Brodsky,“Internet Traffic and Capacity in Covid-Adjusted Terms,”Telegeog-raphy Blog,

309、August 27,2020FIGURE 3.9:ANNUAL GROWTH RATE OF INTERNATIONAL INTERNET TRAFFIC2020 2021 2022 2023201619 60%50%40%30%20%10%0%There has also been a substantial increase in international patenting activity,and this indicator shows no recent declines.Between 2001 and 2022,the share of patent appli-cation

310、s filed by inventors residing outside of the country where the patent application was filed rose from 41%to 53%.43(We exclude China from this calculation due to data comparability concerns.)44 These mixed trends are paralleled in data on corporate research and development(R&D).The share of announced

311、 greenfield FDI projects focusing on R&D rose to a record high level of 9%in 2022 and stood at 7%in 2023(above the 2003-2020 average of 6%).45 However,a recent study reports that the share of business R&D expenditure undertaken by the foreign affiliates of multinational firms peaked in 2013 and then

312、 declined until 2019.46While we cannot draw a direct link between these recent trend shifts and policy changes,it is notable that policies aimed at restricting or regulating international data flows have been enacted recently by many countries.As of early 2023,more than 40 countries had enacted data

313、 localization requirements.47 While countries enact such policies for a variety of reasons,research indicates that they impose sub-stantial costs on companies and can have adverse impacts on trade growth.48423.Are Global Flows Still Growing?The intensity of international information flows has increa

314、sed substantially over the past two decades.The most recent data indicate further increases in international patenting but modest declines in international coauthorship of research articles and charges for the use of international intellectual property(as a share of GDP).Data Sources:Clarivate Web o

315、f Science,World Bank World Development Indicators,World Intellectual Property Organization(WIPO)FIGURE 3.10:INFORMATION PILLAR DEPTH INDICATORSScientific Collaboration (%Intl Coauthored Articles)Patent Applications (%Intl,Excl.China)Charges for Use of Foreign Intellectual Property(%of GDP)30%25%20%1

316、5%10%5%0%01 04 07 10 13 16 19 2201 03 05 07 09 11 13 15 17 19 21 2360%50%40%30%20%10%0%0.6%0.5%0.4%0.3%0.2%0.1%0.0%01 04 07 10 13 16 19 22INTERNATIONAL INFORMATION FLOWS VIA NEWS MEDIADirect contact between people in different countries remains very limited.The vast majority of the worlds population

317、 do not travel to different countries in a given year,and people spend less than 10 hours per year on average talking on the phone to people in other coun-tries.49 As a result,much of what we know about foreign countries depends on what we see in the media;this is the main channel for regular commun

318、ication of infor-mation between countries.Most media coverage,unsurprisingly,focuses on domestic news.Across a sample of 66 major newspa-pers from around the world,roughly 15%of articles,on average,focused on international topics(stories focused on other countries than where the newspaper was based)

319、.While the average share of international news stories has remained fairly steady over the past decade,it varies widely across newspapers.50 The coun-tries a given reader learns about depends very much on which publications the reader chooses to access.To gain clarity on this,we have introduced a ne

320、w indi-cator to this edition of the DHL Global Connectedness Index that tracks patterns of traffic to online news websites based on data provided by Similarweb.On average,we find that only 18%of traffic to online news websites comes from readers outside of the sites home country.This indicator does

321、not have full historical cov-erage available,so it is not incorporated into our trend analysis.But we have begun using it as an input to our country scores and ranks on the information pillar of the index.If we assume that online news websites pro-vide similar levels of international coverage as maj

322、or newspapers(15%,according to our sample of 66 news-papers),this implies roughly 30%of the news a typical reader sees is either about foreign countries or coming through foreign media.The data on traffic to online news websites also fit with many of the same geographic patterns that we will examine

323、 for trade and other flows later in this report.When people do visit news websites from foreign coun-tries,they typically favor sites from nearby countries and countries where the same language is spoken.3.Are Global Flows Still Growing?43PEOPLERecent shocks have affected people flows far more drama

324、ti-cally than other aspects of globalization.International travel collapsed at the beginning of the Covid-19 pandemic and remains below its pre-pandemic level.However,interna-tional education and migration have remained comparatively robust.Prior to the pandemic,international travel had been on a st

325、rong upward trajectory,with the number of people visit-ing foreign countriesfor both leisure and business pur-poses reaching more than five times its 1980 level by 2019.51 The Covid-19 pandemic abruptly reversed this trend,causing the number of people traveling to foreign countries to plunge to a le

326、vel last seen three decades ago.52 Interna-tional tourist arrivals fell 72%in 2020 and remained 69%below the pre-pandemic level in 2021(see Figure 3.11).53 Efforts to contain the spread of the Covid-19 virus caused an unprecedented collapse of international travel,but the number of people traveling

327、to foreign countries was within 10%of its pre-pandemic level by late 2023.Data Source:UN World Tourism Organization(UNWTO)FIGURE 3.11:INTERNATIONAL TRAVEL(ARRIVALS),CHANGE VERSUS 2019443.Are Global Flows Still Growing?0%-10%-20%-30%-40%-50%-60%-70%-80%-90%-100%2020202120222023J F M A M J J A S O N D

328、 J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A SBefore the Covid-19 pandemic,the average person around the world took roughly one international trip every five years(an annual ratio of 0.19 international trips per capita).In 2020 there were just 0.05 international trips per capita(

329、seeFigure3.12).By 2022,a decisive recovery was underway,with the number of people traveling to foreign countries more than doubling in 2022 as compared to 2021 levels.Even with that increase,however,international travel was still 34%below its 2019 pre-pandemic level in 2022 and 12%below that level i

330、n 2023.The UN World Tourism Organization forecasts that the number of people traveling to foreign countries will finally surpass its 2019 level(by 2%)in 2024.54Travel within countries far eclipses travel between them.In 2019,approximately 15%of overnight tourists travelled out-side of their home cou

331、ntries.Available data suggest that this ratio fell to roughly 10%in 2020 and stood at 12%in 2022.55 Favorable visa policy changes for international travel should further strengthen the recovery.As shown in Figure 3.13,the proportion of country pairs allowing travel without first obtaining a visa mat

332、ched its pre-pandemic peak of 54%in 2022,and then continued rising to 56%in 2023.56 This resumes a pre-pandemic trend of countries relaxing visa requirements to boost international arrivals,a pattern that contributed to the long-term rising trend in international travel.57 3.Are Global Flows Still G

333、rowing?45The Covid-19 pandemic caused an unprecedented collapse of international travel,but its effects on international migration and education were much smaller.Data Sources:UN World Tourism Organization(UNWTO),UNESCO Institute for Statistics,UN DESA International Migration Database,UN DESA World Population ProspectsFIGURE 3.12:PEOPLE PILLAR DEPTH TRENDS3.0%2.5%2.0%1.5%1.0%0.5%0.0%4.0%3.5%3.0%2.