What everyone gets wrong about deglobalisation

The headlines are screaming about it. Politicians campaign on it. Economists debate it endlessly. "Deglobalisation" has become the buzzword of our era—the supposed unraveling of decades of global economic integration.

There's just one problem: it's not actually happening.

Don't get me wrong. The world faces real tensions. Trade wars? Absolutely. Rising nationalism? Without question. Supply chain disruptions? We lived through them during the pandemic. But if you look at the actual data rather than the rhetoric, global trade hasn't collapsed. It hasn't even declined. It's simply stopped growing as fast as it once did.

The Real Story Hidden in the Numbers

Here's what the data actually shows: Global exports as a percentage of world GDP climbed steadily from about 15% in the 1980s to roughly 30%¹ by the early 2000s. That was globalization's golden age—an era of falling barriers, expanding trade agreements, and multinational corporations building production networks that spanned the planet.

But since then? The needle hasn't moved much. We're stuck at around 30%, give or take. Trade hasn't reversed; it's plateaued. The world isn't becoming less connected—we've just stopped becoming more connected.

This isn't the economic isolation many feared. It's stagnation, which is an entirely different phenomenon with very different implications.

Why This Matters for Your Wallet

The distinction isn't just academic. If deglobalisation were real, we'd expect to see dramatic price increases as production moved back to high-cost countries. We'd see shortages of critical goods. We'd witness a genuine unwinding of supply chains.

Instead, what we're seeing is something more nuanced. Yes, some production is shifting—but often from one emerging market to another, not back to wealthy nations. Why? The math remains brutally simple.

Consider this jaw-dropping example: Building an iPhone supply chain entirely within the United States—with all the component fabrication, assembly, and logistics handled domestically—would result in a retail price of approximately US$3,500². That's more than three times what consumers currently pay. Even with the recent wave of tariffs imposed on goods from countries like China, labor costs in emerging markets remain dramatically lower. In some cases, wages in places like Kenya are still 20 times cheaper than in the United States.

The Hidden Trade Network

While politicians talk about bringing manufacturing home, emerging markets have been quietly building something else: their own trade networks. Three decades ago, trade between emerging markets made up low single digits of global commerce. Today? It accounts for roughly 20%³ of all trade and growing.

Countries across Asia, Africa, and Latin America aren't sitting around waiting for the West to decide their fate. They're trading with each other, forming regional partnerships, and building economic ties that don't depend on factories in Ohio or ports in Rotterdam.

What This Really Means

The globalization story isn't ending—it's evolving. The simplistic narrative of Western companies outsourcing everything to Asia, then bringing it all back home, was never realistic. What we're witnessing instead is a more complex reordering: supply chains becoming more resilient and diversified, emerging economies trading more among themselves, and a multipolar world economy taking shape.

So the next time someone tells you globalization is dead, you'll know better. It's not dying. It's just growing up—and in some unexpected directions.

The real question isn't whether we're experiencing deglobalisation. It's whether we're paying attention to where the actual connections are being made.

Adapted from Franklin Templeton. (2025, September 25). Holding the line: Emerging markets and the evolving global order. Franklin Templeton

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