I never considered the fact that globalization can have major downsides because open markets and free trade always seemed to be the only way towards prosperity and economic growth. However, the current COVID-19 pandemic exposed the biggest vulnerabilities of a globalized economy.
In such unstable conditions, it would be presumptuous to make economic predictions for five years or even several months in advance. In my opinion, one lesson from the experience of shocks can be learned that crises can bring to the fore the ethical problems that in good times were easy to ignore. One of these problems is globalization when companies can transfer production to where it is most efficient, and cash flows will flow to where they will bring the greatest profit. The idea of a global economy, in which the United States occupies a central place, is already falling apart under the influence of protectionist tendencies in the States and China.
Before the pandemic, the global economy was on its path towards making the world an economic machine that has practically no borders and barriers to hinder the exchange of goods among nations. I always considered that the United States is the number one economy due to its strong global presence and resilient economic machinery. However, the COVID-19 pandemic exposed the fact that efficiency comes at the cost of high fragility. The United States is experiencing major trade deficits in both exports and imports coronavirus heavily disrupted global supply chain networks (Torry, 2020). Pre-pandemic corporations and other multinational entities became high reliant on the functionality of globalization and the openness of borders. The imposed restrictions and containment of the virus meant that free trade and markets are not plausible, which leads to severe stagnation in the economy of not only the U.S. but also the entire globe.
I believe that globalization, the crisis of which has been spoken not only by its opponents, but also part of its supporters, does not cope with real threats to humanity, but only exacerbates them and create more ethical issues. The point is not only in the speed of the spread of the coronavirus around the world by air passengers but in the fact that there is no general planetary plan to combat it. For a long time, I believed that the main advantage of globalization is precisely that it allows us to unite the forces of all humanity in the fight against threats and challenges, such as hunger, disease, and war. It is evident that many nations do not possess high ethical standards to assist their own people, let alone other nations.
I am now certain that the pandemic will inevitably affect my personal and professional views on the ethical aspect of globalization. I will be highly reluctant to seek out entrepreneurship ventures outside the nation, and I will no longer rely on global supply chains, because these are vulnerable to global threats, such as COVID-19. I also think that the most valuable lesson is that any form of efficiency comes at the cost of rigidity. Globalization, to which many are accustomed, may soon cease to exist after many companies in the world change their suppliers due to the impact of coronavirus on the economy. Many politicians and economists may call for abandoning dependence on China, where almost all the production of many goods is concentrated.
In conclusion, globalization has proven to be a highly efficient system that brings prosperity and economic growth. However, I now realize that it also has a major downside in the form of fragility, which can lead to dire consequences.
Reference
Torry, H. (2020). U.S. trade deficit widened in May as both exports, imports fell. The Wall Street Journal. Web.