World's Current Level of Globalization Still Lower Than

World's Current Level of Globalization Still Lower Than Pre-Crisis
Peak, DHL Global Connectedness Index reveals 
- Global connectedness has yet to recover from its steep drop at the
onset of the financial crisis  
- Europe still world's most connected region, Netherlands on top
individually; Sub-Saharan Africa averages largest increase from 2010
to 2011  
- Even the most connected countries can benefit from deeper
integration; potential gains can reach trillions of dollars  
- The world's shifting economic center of gravity is reshaping
industry connectedness 
FRANKFURT, GERMANY -- (Marketwire) -- 11/28/12 -- DHL today released
the second edition of the DHL Global Connectedness Index (GCI), a
comprehensive analysis of the state of globalization around the
world. The report, drawing on over one million data points from 2005
to 2011, concludes that the world today is less globally connected
than it was in 2007. It documents how global connectedness, measured
by international flows of trade, capital, information and people,
grew robustly from the report's baseline year of 2005 to 2007, and
then dropped sharply at the onset of the financial crisis. Despite
modest gains since 2009, global connectedness has yet to recapture
its pre-crisis peak.  
"The GCI 2012 indicates that today's volatile and uncertain business
environment bears the lasting impact of the financial crisis,"
remarked Frank Appel, CEO Deutsche Post DHL. "Especially in this
period of slow growth, it's important to remember the tremendous
gains that globalization has brought to the world's citizens and to
recognize it as an engine of economic progress," he added. "Above
all, governments must resist protectionist measures that hinder
cross-border interactions."  
Changes in connectedness: Sub-Saharan Africa improves; Netherlands
still on top  
While the world as a whole experienced only a very modest increase in
global connectedness from 2010 to 2011, some individual countries had
large gains. The countries with the largest increases in their global
connectedness scores from 2010 to 2011 are Mozambique, Togo, Ghana,
Guinea and Zambia - all of which are located in Sub-Saharan Africa.
While this region remains the world's least connected, it averaged
the largest connectedness increases from 2010 to 2011.  
Th
e Netherlands retained its 2010 position as the world's most
connected country. Of the top ten most connected countries in 2011,
nine of them are located in Europe. This is the world's most
connected region.  
"Europe's high level of global connectivity points to one of the
greatest achievements of European integration," commented Appel. "We
have to remember this as talk of fragmentation enters the debate over
the continent's future."  
Although it tops the 2011 ranking, the Netherlands has surprising
headroom to further increase its integration with the world, as
revealed in a new case study in the 2012 edition of the GCI.  
"Investigating the actual extent of globalization on a
country-by-country and regional basis reveals two critical things,"
explains Professor Pankaj Ghemawat, author of the GCI. "First,
cross-border flows are significantly lower than commonly perceived,
and second, every country - even the Netherlands - has untapped
possibilities to benefit from more connectedness. At a time of
economic weakness, this represents one of the most powerful levers
available for boosting growth."  
Connectedness and prosperity strongly linked  
The 2012 edition of the GCI also includes case studies on Mexico and
Vietnam and offers eight recommendations to help countries enhance or
expand their connectedness with the rest of the world. This new
chapter also highlights evidence that the depth of global
connectedness - the proportion of flows that cross national borders -
contributes to economic development and prosperity.  
"The benefits of expanding merchandise trade are much larger than
traditional models indicate," explains Professor Ghemawat. "Adding to
that the gains from services trade and other kinds of cross-border
flows, the estimated economic benefits double to at least 8% of
global GDP."  
Industry connectedness impacted by the rise of emerging markets  
A further key enhancement to the 2012 edition of the GCI is an
analysis of industry-level connectedness. The report concludes that
the world's shifting economic center of gravity is reshaping industry
connectedness. The migration of production and consumption to
emerging markets has specific implications for the three industries
highlighted in the report: pharmaceuticals, passenger cars and mobile
phones. The report offers lessons on how companies can adapt their
strategies to benefit from the changing geography of production and
consumption. 
Note to editors:  
The DHL Global Connectedness Index 2012 as well as supplemental
background information can be downloaded at www.dhl.com/gci.  
Some surprising facts from the GCI 2012: 


 
--  Along most dimensions, the world is less than 20% globalized - often
    even less than 10% 
--  Of the international flows that do take place, 50-60% occur within
    regions 
--  The world's center of economic gravity shifted thousands of kilometers
    to the east in the past decade, and continues to do so 
--  The most connected country, the Netherlands, is hundreds of times more
    connected than the least, Burundi 

 
DHL - The Logistics company for the world  
DHL is the global market leader in the logistics industry and "The
Logistics company for the world". DHL commits its expertise in
international express, air and ocean freight, road and rail
transportation, contract logistics and international mail services to
its customers. A global network composed of more than 220 countries
and territories and about 275,000 employees worldwide offers
customers superior service quality and local knowledge to satisfy
their supply chain requirements. DHL accepts its social
responsibility by supporting climate protection, disaster management
and education. 
DHL is part of Deutsche Post DHL. The Group generated revenue of 53
billion euros in 2011. 
For more information: www.dp-dhl.com 
About the authors of the DHL Global Connectedness Index 2012:  
Pankaj Ghemawat is the Anselmo Rubiralta Professor of Global Strategy
at IESE Business School in Barcelona, Spain. He served for more than
twenty years on the faculty of Harvard Business School, where in
1991, he became the youngest person in the school's history to be
appointed a full professor. Ghemawat's latest book, World 3.0, won
the Thinkers 50 Book Award for the best business book published in
2010-2011. 
Steven A. Altman is Senior Research Associate and Lecturer in
Strategic Management at IESE Business School in Barcelona, Spain.
Contacts:
Media Contact:
DHL - Media Relations
Claus Korfmacher
+49 (0)228 182-99 44
pressestelle@deutschepost.de 
www.dp-dhl.com/press
www.twitter.com/DeutschePostDHL
 
 
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