“Deglobalization” has entered the narrative zeitgeist. But what’s happening on the ground? This weekly series seeks to answer that question with a round-up of deglobalization developments from the week that’s done.
1. In the US, reshoring and FDI job announcements hit the highest rate ever recorded in 2022, according to the Reshoring Initiative, with Q4 trends growing even more than expected thanks to domestic investment and deglobalization trends. 364,000 reshoring and FDI jobs were announced for 2022, up 53% from 2021’s record.
2. Chinese authorities raided the Beijing offices of due diligence firm Mintz Group, detaining all five of the New York-based firm’s staff members in mainland China. Mintz said that it is licensed to do business in China and operates transparently and within the law – and that it had no idea who was detaining its staff or when they might be released. There was no advance notice of the raid.
3. The Wall Street Journal reported that countries are competing to lure manufacturers away from China, with India, Mexico, Vietnam, Cambodia, and the Philippines all battling on subsidies, tax breaks, and other perks to “convince businesses that their country is the next best thing” to China.
4. Foreign car makers are being squeezed out of the Chinese market: A full-blown price war is underway in the Chinese auto market, with Chinese, subsidy-backed companies leaving their international rivals in the dust. Domestic Chinese brands accounted for around half of car shipments in China this year, compared with 38% in 2019.
5. TikTok CEO Shou Chew was raked over the coals in a Congressional hearing, as lawmakers from across both sides of the aisle grilled him on ties to China, information sharing with China, and the insistence that TikTok be banned in the United States. “Yes or no, do Chinese employees including engineers have access to US user data,” asked Ohio Representative Bob Latta. “This is a complex subject,” answered Chew.
6. Sweden, long considered a bastion of free trade and open economies, is considering draft regulation to screen foreign investments in strategically important or sensitive industries – to include energy, healthcare, transport and communications, critical raw materials, data, cloud computing, military equipment, and dual-use products.
7. The US has confirmed the use of Chinese ammunition in Ukraine, fueling concerns about Beijing’s support for Moscow’s offensive – and calls to punish China accordingly. Compounding that: Xi’s tête-à-tête with Putin this week.
(Photo by Pexabay/Pexels)