Intra-Asia trade flows remain strong while the West remain key trading partners of Asia - Evidence shows that markets in Asia Pacific are strongly connected with each other in the region. At least 70 percent of the countries in Asia Pacific have strong flows with their Asian counterparts. Looking at these countries’ top 10 connections, six or more are with an Asia Pacific market, citing robust intra-Asia trade. The Asian region is also closely connected with the West, with many of them having the United States or United Kingdom as their top 10 connections.
Three questions, three insights: The analysis of global trends in the 2024 Global Connectedness Report examines three questions at the center of current debates about globalization.
1. Are global flows still growing?
The evidence strongly rebuts the notion that the growth of global flows has gone into reverse. The world’s overall level of global connectedness reached a record high in 2022, and data suggest it remained at roughly the same level in 2023.
Trade growth played a key role here. The share of global output traded internationally hit a record high in 2022. Early data suggest a modest decline in 2023, but this isn’t a signal of deglobalization. Trade growth normally lags behind GDP growth when the global economy slows.
Furthermore, it seems companies haven’t lost their appetite for international expansion. Examples include a rise in the value of announced greenfield foreign direct investment (FDI), and the fact that publicly traded companies from most countries are earning more of their sales abroad, among others.
People flows, which were hard hit by the Covid-19 pandemic, continued a strong recovery trend in 2023. International travel reached 88% of pre-pandemic levels and was on track for a full recovery by the end of 2024.
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