We have two covers this week. In most of our editions we focus
on the reinvention of globalisation. After the go-go 1990s and 2000s the
pace of economic integration stalled in the 2010s, as firms grappled
with the aftershocks of a financial crisis, a populist revolt against
open borders and President Donald Trump’s trade war. No one knew if
globalisation faced a blip or extinction. Now the pandemic and war in
Ukraine have triggered
a once-in-a-generation reimagining of global capitalism.
Everywhere you look, supply chains are being transformed, from
the $9trn in inventories, stockpiled as insurance against shortages and
inflation, to the fight for workers as global firms shift from China into
Vietnam. This new kind of globalisation is about security, not efficiency:
it prioritises doing business with people you can rely on, in countries
your government is friendly with. It could descend into protectionism,
big government and worsening inflation. Alternatively, if firms and
politicians show restraint, it could change the world economy for the
better, keeping the benefits of openness while improving resilience.
In our Latin American edition we consider the region’s
vicious circle of economic stagnation and popular frustration,
and the warning this offers to the West. The kind of polarised
choice facing voters in this weekend’s presidential run-off in Colombia
has become worryingly familiar in Latin American elections. There no
longer seem to be many takers for the moderation, compromise and gradual
reform needed to become prosperous and peaceful. That matters not just
to Latin America, but to the world. Despite everything, the region
remains largely democratic and should be a natural ally of the West. But
its economies have suffered a decade of stagnation or slow growth. Its
people, especially the young, have become frustrated by their lack of
opportunity. They have turned this anger against their politicians, who
are widely seen as corrupt and self-serving, and have been unable to
agree on the
reforms needed to make Latin America’s economies more efficient. The
consolidation of democracy used to be seen as a one-way street. But
Latin America shows that democracies can easily decay—and that is a
warning for democrats everywhere. |