How the Coronavirus is Accelerating Deglobalization

In its heyday back in the 19th century, Lowell, Mass., proudly bore the nickname “Spindle City,” a nod to the clattering textile mills that triggered America’s industrial revolution. Nearby towns had their own claims to fame: Leominster was “Plastics City,” Gardner was “Chair City,” Holyoke was “Paper City,” and Waterbury, Conn., was known as “Brass City.” After World War II, some of these industries migrated to southern states before eventually moving offshore to Japan, South Korea and Taiwan. In the end, they all congregated in one place: the Chinese seaboard, the workshop of the world.

The coronavirus that’s shuttered factories there, however, signals a new phase in what’s becoming a great reversal of the west-to-east industrial journey. Businesses are reassessing China’s role in global supply chains, and by the time this virus burns out, many of them will have started planning to relocate at least some of their production elsewhere. Deglobalization is accelerating.