Five themes to focus on for fairer globalisation

Bill Winters, CBE Group Chief Executive

12 Jan 2024

In just three decades, globalisation has brought unprecedented economic and social change to almost every corner of the world. Globalisation has lifted billions out of poverty and given them new economic opportunities. We have witnessed large-scale shifts in manufacturing and the growth of complex, interlocking supply chains, incredible cultural exchange and human migration.

Despite this run of success, globalisation is under increasing threat. Many communities in developed and developing markets feel left behind by the pace of change or threatened by damage to vital ecosystems. The 2008 financial crisis and the COVID-19 pandemic both dented faith in the power of the market to manage cross-border flows of goods and capital, and there is growing pressure for governments to prioritise domestic manufacture of critical products.

Resetting globalisation – preserving its benefits and addressing its flaws – is a critical task as we attempt to address global challenges. We recently connected with more than 3,000 business leaders across 20 markets to understand how this reset can be achieved. Their insights, collated in our ‘Resetting Globalisation: Catalysts for Change’ report, underscore key challenges around capital, trade, technology, talent and culture and sustainability, and highlight opportunities to drive progress.

The vast majority of business leaders across all markets agree that capital should be able to flow freely anywhere in the world. However, while most feel that governments should encourage foreign investment, a majority remain unconvinced that it has benefitted their economy. There is also doubt over whether cross-border financial markets have benefited developed and developing markets alike.

Alongside capital and physical goods, the free flow of data and digital services is also a crucial component to globalisation. Business leaders broadly agree that this has had a positive outcome. And many feel that innovations such as decentralised finance will create a more equitable financial system. As part of Standard Chartered’s international banking offering, the free flow of data and digital services between jurisdictions allows for more seamless, secure and simplified banking support for retail and business customers. But as with the more traditional aspects of global commerce, there is pressure on financial institutions and other market participants to prove the value of cross-border activity.

Advocates of globalisation must ensure that it brings benefits to as many people in as many places as possible, and emphasise its crucial role in dealing with global problems like climate change. At Standard Chartered, we are bringing the full capabilities of the bank to address this challenge.

To improve financial inclusion, we are partnering with local digital service providers in multiple markets to bring banking products to previously underserved customers. In India and Kenya, we have launched an e-commerce platform, Solv, that will help small and medium-sized enterprises access loans and other financial products. In UAE, we launched Appro that digitises, streamlines and simplifies the retail banking user journey, reducing onboarding processing time to three minutes.

We are also working with clients across our footprint to strengthen cross-border supply chains for the resources and power sources that are critical for net zero – for instance, expanding nickel extraction in India, facilitating finance for electric vehicle battery manufacturing in China and building out renewable energy storage solutions in Africa.

Our report shows a healthy reservoir of support for globalisation among business leaders. But that can run dry quickly if we don’t work harder to maintain and demonstrate progress. Against a backdrop of geopolitical tension and macro-economic problems, that can sometimes feel like an insurmountable task. However, the solutions to our shared challenges can only be found in collaboration and connection, not fragmentation and isolation.

Produced by Bloomberg Media Studios in partnership with Standard Chartered.