A report from parcel shipping company DHL finds robust growth in global trade volumes despite geopolitical conflicts and public policy headwinds, the company said Friday.
Globalization is flourishing as measured both by the nearshoring or “omnishoring” trend to diversity supply chains for production and assembly, and by e-commerce shopping levels that accelerated during the pandemic, DHL Express Americas CEO Andrew Williams said in a webcast.
That growth has happened in terms of increased flows of trade, capital, people, and information, in the face of major events such as the U.S. Administration’s levy of tariffs on Chinese goods, Russia’s invasion of Ukraine, and the Covid pandemic, the company said in the 2024 edition of its “DHL Global Connectedness Report.”
“E-commerce is a democratizing force in global trade; when countries open up their shops to the world, they see larger revenues, lower returns, and greater success,” Williams said. “We think it’s important to counteract some of the rhetoric or doubt in the world about a reduction in global trade.”
DHL’s statement came just days after a similar statement by fellow international parcel carrier FedEx Corp., which last week called on U.S. policymakers to “reprioritize ambitious trade agreements.”
At a worldwide level, the new DHL report found that global trade flows took a shot in the aftermath of the 2008 financial crisis, but recovered to a record high in 2022 and stayed near that level in 2023, said Steven Altman, a professor at New York University’s Stern School of Business who authored the report.
By a more regional measure, trade between the U.S. and China has fallen in both directions by 25% since their trade war began in 2016. But those two nations are still connected by larger flows than any other pair of countries without a shared border, except only for the U.S. and U.K., Altman said.
The other major change in recent years is Russia, which has seen its trade flows with the European Union plummet since invading Ukraine. But the rest of the world shows no fracturing of global trade activity, as most other countries instead have maintained their ties with traditional trading partners, according to Altman.
On a global level, the data also refute the idea that we are living in an age of unfettered globalization, as some would claim: International flows are still much smaller than flows within national borders, the report said. “The resilience of global flows in the face of 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, while better managing its challenges,” Altman wrote in the report.
Gartner, Inc.