DHL Global Connectedness Index: Trade remains resilient

Global Connectedness

Posted on 11/12/2019 by DHL Express 0 comments

Now in its sixth edition, the DHL Global Connectedness Index (GCI) details globalisation measured by international flows of trade, capital, information and people.

The report covers 12 international flows across 169 countries and territories, providing the most up-to-date picture of the world we live in today – and where best to find your next trading partner. It provides full coverage from 2001 to 2018, along with partial analysis of the first half of 2019, and features a deep dive into the US-China trading relationship.

The 2019 report showed that connectedness dipped slightly in 2018, and despite strong headwinds in global geopolitics and trade, the GCI stayed close to its record high of 2017. With no signs of a reverse in globalisation, the world remains more connected than at any point in history.

“The overall dip in connectedness remains limited compared to longer-term trends. In fact, the world is still more globalized than at almost any previous point in history. That’s something I find very reassuring. And even today, most business activity is still local, not global,” commented CEO of Deutsche Post DHL Group, Frank Appel.

GCI co-author and Senior Research Scholar at the NYU Stern School of Business, and Executive Director of NYU Stern’s Centre for the Globalization of Education and Management, Steven A. Altman, commentedon the cost of rising barriers to international flows on business and trade: “A grounded perspective on how much global flows are changing is essential to prudent business and public policy decision-making.”

Top six take-aways of GCI 

  1. The world’s level of connectedness declined in 2018, reversing part of the gains that had helped it achieve a record high in 2017. The DHL Global Connectedness Index was pulled down by capital flows, even as flows of trade, information, and people intensified.
  1. In spite of escalating trade tensions, trade remained resilient during 2018. However, this strength has not extended into 2019, with the proportion of global output traded internationally declining during the first half of the year.
  1. China’s rapid growth has meant that US imports from China have stabilised, rather than shrinking relative to the size of the US economy.
  1. The average distance across which countries trade has held steady since 2012. Data on global flows through 2018 do not indicate a shift from globalisation to regionalisation.
  1. Digital technologies are transforming information flows. After nearly two decades in which growth of cross-border communications far outpaced domestic communications, both seem to be expanding at more similar rates now.
  1. While the world is more connected than at almost any previous point in history, international flows are far smaller than most people presume. Business still mostly takes place within, rather than across, national borders.

Click here to explore the full DHL Global Connectedness Index.

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