From the headlines, it looks as if momentum toward economic globalization has gone into reverse. But the underlying data is less clear. Steven A. Altman and Caroline R. Bastian lay out some evidence in the “DHL Global Connectedness Report 2026.” Some of their summary findings include:
The DHL Global Connectedness Index does not indicate a shift from international to domestic activity across trade, capital, information, and people flows. Global connectedness reached a record high in 2022 and has not changed appreciably through 2025. … U.S. tariff increases only modestly reduced forecast global trade growth. Other countries supported trade growth by not raising tariffs, and many negotiated new trade deals to secure access to alternative markets. … The world remains far from a split into disconnected geopolitical blocs. Only 4-6% of global goods trade, greenfield FDI, and cross-border M&A have shifted away from geopolitical rivals over the past decade. Trade flows shifted more toward neutral countries than to close allies, implying more ‘de-risking’ than ‘friendshoring’. … Prominent narratives about deglobalization are driven more by politics and public policy than by actual shifts in cross-border flows. While the risk of deglobalization has risen and the pattern of connectedness is shifting, the world overall remains as connected as ever.
Here are a few figures that caught my eye:
Global trade as a share of world GDP has been holding steady for a couple of decades now, with trade in goods sagging a bit and trade in services surging bit.
Global value chains–that is, goods where the stages of production happen in multiple countries–continue to lengthen.
The size of international capital investments, including foreign direct investment and portfolio stock investment have dropped a bit in these last few post-pandemic years, but remain near their all-time highs.
The report seeks to capture economically relevant information flows by looking at international collaboration in scientific articles, charges for use of foreign intellectual property, and international patent applications.
The report emphasizes that globalization still has plenty of room to expand:
[I]nternational flows of many types are close to record high levels relative to domestic activity. Nevertheless, we do not live in a “hyperglobalized” world. Most activity that could happen either within or across national borders is still domestic … The most recent available data show only 21% of all goods and services ending up in a different country from where they were produced. Companies buying, building, or reinvesting in foreign operations via FDI accounted for only 6% of gross fixed capital formation. Just 18% of traffic to online news websites came from abroad. And just shy of 4% of people lived outside of the countries where they were born.
Will globalization remain resilient, in the face of political pressures? Quite possibly. As the report points out, countries around the world outside the US clearly place a high value on the gains from trade; indeed, many of them are signing new trade agreements and keeping tariffs low with each other. The US economy is disengaging from direct trade with China, but in a multipolar world economy, this process often involves re-routing of trade, along with seeking out new opportunities, rather than a decline in the global total. Moreover, increases in trade have often been driven historically by new technologies–shipping, air freight, containerization, information flows. For example, the report cites a projection from the World Trade Organization that “AI could lift global trade in goods and services by 34–37% by 2040.” Love it or hate it, globalization doesn’t seem to be going away.
