Executive Briefings

Despite Globalization, the World Doesn't Seem to Be as Connected as We Might Have Presumed

Hardly a day passes without references to today's supposedly "globalized world" or its "borderless markets" as the justification for a particular public policy or business strategy. While it is celebrated by some and decried by others, the extent of global connectedness today is often assumed to be complete, or nearly so. But the actual extent of global connectedness is not only far more limited than popular rhetoric presumes, but also varies widely among countries, according to the DHL Global Connectedness Index. Therefore, a better understanding of this important phenomenon requires that it be measured on a country-by-country basis.

Global connectedness, as defined here, refers to the depth and breadth of a country's integration with the rest of the world, as manifested by its participation in international flows of products and services, capital, information, and people. This report summarizes overall levels of global connectedness, and of its depth and breadth dimensions, at the level of 10 different types of flows for 125 countries and territories from 2005 to 2010. In 2010, these countries and territories accounted for 98 percent of the world's GDP and 92 percent of its population.

The top 10 overall ranks in the Index are occupied, in descending order, by the Netherlands, Singapore, Ireland, Switzerland, Luxembourg, United Kingdom, Sweden, Belgium, Hong Kong (China), and Malta. These leaders in terms of global connectedness are a diverse set of countries, spread across Europe and Asia, and ranging from the world's sixth-largest economy (United Kingdom) to one of the smaller independent nations (Malta). The diversity of the leading countries in the index is amplified when one looks at the top 50 countries, which include representatives from all six continents covered in the study. These patterns indicate that the benefits of connectedness are accessible to a broad range of countries, not just small trading hubs that lead most other globalization indexes.

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Hardly a day passes without references to today's supposedly "globalized world" or its "borderless markets" as the justification for a particular public policy or business strategy. While it is celebrated by some and decried by others, the extent of global connectedness today is often assumed to be complete, or nearly so. But the actual extent of global connectedness is not only far more limited than popular rhetoric presumes, but also varies widely among countries, according to the DHL Global Connectedness Index. Therefore, a better understanding of this important phenomenon requires that it be measured on a country-by-country basis.

Global connectedness, as defined here, refers to the depth and breadth of a country's integration with the rest of the world, as manifested by its participation in international flows of products and services, capital, information, and people. This report summarizes overall levels of global connectedness, and of its depth and breadth dimensions, at the level of 10 different types of flows for 125 countries and territories from 2005 to 2010. In 2010, these countries and territories accounted for 98 percent of the world's GDP and 92 percent of its population.

The top 10 overall ranks in the Index are occupied, in descending order, by the Netherlands, Singapore, Ireland, Switzerland, Luxembourg, United Kingdom, Sweden, Belgium, Hong Kong (China), and Malta. These leaders in terms of global connectedness are a diverse set of countries, spread across Europe and Asia, and ranging from the world's sixth-largest economy (United Kingdom) to one of the smaller independent nations (Malta). The diversity of the leading countries in the index is amplified when one looks at the top 50 countries, which include representatives from all six continents covered in the study. These patterns indicate that the benefits of connectedness are accessible to a broad range of countries, not just small trading hubs that lead most other globalization indexes.

Read Full Article