What the Next Era of Globalization Will Look Like

Editor: You talk in the book about how fragile many global supply chains have become. Why would a less globalized, more localized supply chain tend to be more resilient?

Rana: Well, for starters, you have proximity (亲近).【小题1】. We had these “just-in-time”, “efficient” supply chains that were built, taking products around the world. It saves big companies a lot of money as long as nothing is going wrong in the world. But when anything goes wrong, be it a tsunami, be it a geopolitical event, be it a war, a trade war, a cold war, a hot war, you get problems. 【小题2】

Also, I would say when I think of resiliency, I think of sustainability. And well before the pandemic or the war in Ukraine, companies were actually already starting to think about localization for all kinds of reasons. 【小题3】. The wage productivity arbitrage(工资套利)was losing its appeal. Wages were rising enough in the east so that the arbitrage didn’t make as much sense as it used to.

Finally, you are starting to have environmental concerns where companies are being asked to consider, “Okay, how many units of carbon are you expending to tote X product to Y location?” All of this was sort of pushing that notion of localization for resiliency.

Editor: 【小题4】. Why not use antitrust(反垄断)to encourage more competition-but keep supply chains globalized?

Rana: I don’t see them as an either-or proposition; I see them as ideas that work hand in hand. Let me give you an example: Right after the pandemic hits, everybody goes into lockdown, suddenly nobody’s eating out. Restaurants are closed; grocery stores have huge lines in front of them. And yet there are no products on the shelves. You can’t find tomato sauce, you can’t find juice. There are all these strange gaps that start to appear. And you might say, “Well, why is that?”