Will the Coronavirus End Globalization as We Know It?

The authors argue that the new coronavirus has put the concept of interconnectedness into self-evaluation mode. As critical supply chains break down, and nations hoard medical supplies and rush to limit travel, globalization faces a stress test. The reevaluation of the interconnected global economy is necessary not only because it allowed the spread of this contagious disease, but also because it facilitated deep interdependence between firms and nations, which made them vulnerable to major shocks. The authors opine that globalization negated the buildup of stockpiles of supplies by terming the inventory as “fundamentally evil,” and in return depending on a single specialized manufacturer for the production of critical and widely used components. However, the reliance on the “just-in-time” supply amidst a global pandemic has proved problematic, as it can easily become too late. The approach adopted by EU countries like Germany and France, by deciding not to export critical components like masks to its fellow member-states, also undermines or rather ignores the concept of single market; thereby posing a question mark on the concept of globalized economies. As the crisis is exposing the vulnerabilities and fragile nature of globalization, China is using this crisis to showcase its willingness to lead. This crisis has exposed the vulnerabilities of globalization and may also cause a shift in the global politics. With countries deciding to block exports, generosity would become a powerful weapon of influence for states that can afford it. With the US hiding under the covers, China seems to be the leader so far.