A New Crossroads

By Wen Qing

‘Assuming that major players in the global semiconductor industry all have established a fully selfsufficient local supply chain， it will push up the overall prices of their products by 35 to 65 percent. And that will ultimately lead to higher sales prices to consumers， thus hurting the overall economic development，” Zhao Bin， Senior Vice President of Qualcomm， said at the Seventh China and Globalization Forum in Beijing on July 30. “Therefore， this industry is in high need of global cooperation.”

This is just one specific case showcasing the vital importance of globalization， a hot topic for discussion during the event.

Regarding the process of globalization， people may have different opinions about what time it really began. There are those who believe that the concept in fact dates back to the Silk Road which connected the West and the East as trading routes some 1，500 years ago， while others hold that it was the Industrial Revolution （1760-1840） that truly initiated globalization.

One thing all can agree on today is that we live at a time when globalization faces one of its most daunting challenges in modern history， with resisting forces mainly hailing from the U.S.

Why has the U.S.， once upon a time the most loyal supporter of free trade， now seemingly turned against globalization？ Can it really reverse this trend？ How should countries promote the concept to better benefit their people？

On the rocks

“Traditional globalization has reached a new crossroads. The reason behind the current difficulties lies in the reality that its governance is lagging behind，” Chen Deming， former Minister of Commerce of China， said.

During the over 70 years since the end of World War II， humanity has accumulated a large amount of wealth thanks to globalization. However， its distribution is unfair. Some countries， regions and groups gained more at the expense of others. “The delay in global governance reform has led to the rise of populism and nationalist thinking in some countries， which has brought about further complications to globalization，” Chen further detailed.

Chen rejected the arguments of some politicians in developed countries that China has benefited more from globalization. “As a matter of fact， the U.S. has benefited no less than China； on the contrary， even more so，” he said.

In a multi-study review released in January 2020， experts concluded that advances in globalization from 1947 had added $800 billion-$1.5 trillion， or 11 to 14 percent， to the U.S. GDP of $11 trillion back in 2003. Interpreting these estimates for the 2018 U.S. GDP suggests those changes in economic interdependence since 1947 added $2.2-$4 trillion， or 11 to 19 percent， to the$20.5-trillion volume.