The Debate

Coronavirus and the Future of Globalization

Recent Features

The Debate

Coronavirus and the Future of Globalization

The pandemic may exacerbate an existing tendency for countries to turn inward.

Coronavirus and the Future of Globalization
Credit: AP Photo/Carlos Giusti

The coronavirus has been relentless, rampaging beyond China and East Asia, including Japan, South Korea, and Southeast Asia, to engulf Italy and Europe, North America, and Central and South America. The latest figures show in excess of 200,000 confirmed cases, with more than 8,000 deaths. China has had the highest number of fatalities, with more than 3,100 deaths, but the number in Italy is rising rapidly. The world has shifted to crisis mode, with WHO Director-General Tedros Adhanom Ghebreyesus declaring the novel coronavirus epidemic a “pandemic” on March 11.

The rise of the liberal international order has been a major factor in the growing movement of people across borders, whether for purposes of supply chains and distribution networks, international finance and the flow of money, employment, study or tourism. But this globalization has also allowed the entire world to be much more aware of the spread of the coronavirus, and it may ultimately be a powerful force for its own undoing.

There are two sides to the globalization coin. On the positive side, the cross-border flow of people, goods, money and information creates new wealth and opportunity. On the negative side, though, it can exacerbate global disparities, enable international terrorism and cross-border crime, and allow for the rapid spread of disease.

We saw this latter effect with the SARS outbreak in 2003, but compared to the start of this century, the cross-border movement of people has increased dramatically, and the speed of the spread of this novel coronavirus has been of an entirely different order.

Countries around the world are now responding by restricting the movement of people, blocking the entry of people from countries particularly hard hit by the coronavirus or requiring inbound travelers to self-quarantine for a period of time. Of course, once the pandemic has eased, these restrictions will surely be removed. But with this new awareness of the risks associated with the free movement of people, there are some who may avoid future life, business or leisure plans that require crossing borders.

In particular, the coronavirus pandemic is having devastating repercussions for corporations and businesses that have benefited from economic interdependence supported by cross-border supply chains. China is the world’s largest production base, and lies at the heart of many supply chains. Since the outbreak of this coronavirus, many companies that had come to depend on China were hard hit. Meanwhile, the tourism sectors of Japan and many other countries that had profited from the large influx of Chinese tourists in recent years have been severely impacted by plummeting inbound numbers. The challenge for the manufacturing and tourism industries in many countries is to determine to what extent dependence on China and Chinese people can be reduced.

In fact, the need may go beyond China. From a risk analysis perspective, we could at the very least see a rapid trend towards moving from globally dispersed production bases back in favor of domestic facilities. Of course, it is unlikely that the tourism industry will stop looking to international arrivals. But many in the industry may have to start working on initiatives to increase domestic demand.

In short, national borders may become less porous in terms of industry and the movement of people when compared to the 30 years of globalization seen since the end of the Cold War, with sharper lines drawn between domestic and foreign and a move away from dependence on international relationships.

What is ominous is that this trend towards strengthening national borders was already manifest in a number of countries. Brexit, the rise of populism accompanied by anti-foreigner sentiment in multiple European countries, and the America First policy of the Trump Administration were spurred by a sense of increased disparity and the rising burden on certain segments of the population from advances in globalization.

The liberal international order has already taken some body blows, and physical and psychological national borders have become more rigid than before. Even in Asia, domestic pressure is increasing, with rising nationalism that emphasizes the superiority of the ethnic and religious majority of a given country, as seen in the increased oppression of the Uyghurs and other minorities and the attempts to block the free flow of information in China or in rising Hindu nationalism in India.

These trends – less porous borders and rising nationalism – and now joined by the closure of borders outright due to the spread of the coronavirus. The result may be a move towards a more closed-off world, one in which national borders limit the scope of social activity.

The challenge is to take the liberal international order in a healthy direction by regulating and attenuating the burdens of globalization. And in fact this will require stronger international cooperation. The threat of the coronavirus has created an extraordinary situation, but once we have recovered, it is crucial that we create mechanisms to respond to disease through effective international cooperation, without falling victim to short-sighted ethnocentrism in the process of once again returning to normality.

At the same time, we will need to work towards eliminating problems such as social and economic disparities caused by globalization. Fail to do so, and we might see countries turning increasingly inward with a mindset of narrow-minded nationalism.

Mie Oba is a professor at the Tokyo University of Science.