Civil Services Prep

With the waning of globalization, post-Cold War world is becoming a site of sovereign nationalism. Elucidate.

Model answer

The post-Cold War era initially witnessed deep globalisation through free trade, liberal institutions, global supply chains and increased interdependence. However, economic crises, geopolitical conflicts, migration and perceived loss of national control have strengthened sovereign nationalism. The shift is visible in the 1.2% decline in world merchandise trade volume in 2023 and the introduction of nearly 3,000 harmful trade and FDI restrictions in 2023, according to the WTO and IMF. Global FDI also fell by 2% to $1.3 trillion in 2023, according to UNCTAD’s World Investment Report 2024. Yet digitally delivered services exports grew by 9% to $4.25 trillion in 2023, according to the WTO, indicating transformation rather than the end of globalisation. **Protectionism:** States are imposing tariffs, subsidies and investment restrictions to protect domestic industries. **US–China rivalry:** Competition over semiconductors, 5G, artificial intelligence and critical minerals reflects a shift from economic interdependence to strategic autonomy.

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