The ongoing violence in Ukraine has prompted hundreds, if not thousands, of western companies to follow their governments in sanctioning or withdrawing from Russia.
Just this week we've seen Starbucks close all of its restaurants, Unilever suspend imports or exports, adidas suspend sales and Goldman Sachs begin a full exit from the country — to name but a few of the major moves.
Peak globalization?
That throws the trend of globalization — the increasing interconnectedness and integration of countries around the world — back into the spotlight, and begs the question: is "peak globalization" behind us?
Some pundits think it already is, pointing to the fact that global trade has actually fallen as a share of global GDP in the last decade or so — suggesting countries are increasingly finding domestic solutions in their markets, instead of looking overseas.
That trend was accelerated by the pandemic, which made cross-border trade more difficult. Global trade was 52% of global GDP in 2020, down from 61% in 2008.
Russia's retreat from the world
Even in an ideal scenario in which the violence in Ukraine somehow halted right this instant, the impact of what's happened in the last few weeks would likely take years, if not decades, to undo. Would Starbucks want to re-open its stores in Russia? Will McDonald's? Will we buy Russian vodka like we used to?
