Dockworkers in Los Angeles have seldom been busier. America’s biggest port reported its highest-ever level of activity for the month of February in its 115-year history, reflecting record trade volumes globally.
Yet the surge in activity comes as policymakers, economists and investors fear that globalisation may have peaked after 30 years of growth. Some even predict that trading volumes may suffer a sharp reversal as disputes between leading nations intensify after Russia’s invasion of Ukraine and as companies strive to build more resilience into global supply chains.
It would not be the first time a crisis triggered significant changes in trading patterns. Trade growth slowed sharply after the 2008-09 global financial crisis, shifting from rising roughly twice as fast as global gross domestic product to a similar rate. An earlier era of globalisation, linked to the industrial revolution and underpinned by the gold standard currency regime, was snuffed out by the first world war. Trade’s share of global GDP did not return to its 1914 level until the mid-1970s.