In conversation with Richard Baldwin

While globalisation is slowing, the forces driving this shift are often not well understood. One significant trend is the rise of technology, which is localising production. Historically, companies relocated operations overseas primarily to take advantage of lower labor costs. However, advancements in automation are fundamentally transforming this landscape by reducing the need for labor in manufacturing processes. As the cost share of production declines, the incentive to produce goods far from their markets diminishes.

In the long run, we can anticipate a shift towards more localised and regionalised operations. This evolution not only enhances operational efficiency but also fosters sustainability and strengthens supply chains.