From Globalization to Regionalization: The United States, China, and the Post-Covid-19 World Economic Order
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From Globalization to Regionalization: The United States, China, and the Post-Covid-19 World Economic Order Zhaohui Wang 1 & Zhiqiang Sun 2 Accepted: 23 October 2020/ # Journal of Chinese Political Science/Association of Chinese Political Studies 2020
Abstract The Covid-19 pandemic has intensified the debate among optimists, pessimists, and centrists about whether the world economic order is undergoing a fundamental change. While optimists foresee the continuation of economic globalization after the pandemic, pessimists expect localization instead of globalization, given the pandemic’s structural negative consequence on the world economy. By contrast, the centrists anticipate a “Ushaped” recovery, where Covid-19 will not kill globalization but slow it down. The three existing perspectives on Covid-19’s impact on the economic globalization are not without merit, but they do not take sufficient temporal distance from the ongoing issue. This article suggests employing the historical perspective to expand the time frame by examining the rise and fall of economic globalization before and after the 2008 global financial crisis. The authors argue that economic globalization has been in transition since the 2008 financial crisis, and one important but not exclusive factor to explain this change is the evolving US–China economic relationship, from symbiotic towards increasingly competitive. The economic restructuring in US and China has begun after both countries weathered the 2008 crisis and gained momentum since the outbreak of trade war and Covid-19. The article investigates this trend by distinguishing different types of production activities, and the empirical results confirm that localization and regionalization have been filling the vacuum of economic globalization in retreat in the last decade. Keywords Globalization . Regionalization . US–China relations . World economic order .
Covid-19
* Zhaohui Wang [email protected] Zhiqiang Sun [email protected] Extended author information available on the last page of the article
Z. Wang, Z. Sun
Introduction After the White House published the Trump administration’s first National Security Strategy (NSS) report in 2017, many analysts anticipated that it represented a significant shift in America’s China policy [42, 44]. Indeed, the great power competition between Washington and Beijing has been intensified since then. After Trump announced a series of tariff plans on Chinese goods and US–China trade disputes rapidly escalated to an unprecedented level in 2018, many observers remarked that they were fundamentally driven by the increasingly competitive US–China relationship and that the negative consequences of a trade war could spill over into other domains such as technology, military, and ideology [47, 59]. After Trump declared that America must win the race for 5G and the US government decided its ban on Huawei in 2019, commentators regarded it as a technology cold war and the prelude to the US–China new cold war, which would probably give rise to the disinteg
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