Autor: Manuel Rupprecht

The world economy is under tension. For years now, globalization has been faltering, moving sideways at best. Recent developments have caused additional distortions. There is now a strong desire for independence. In many places, subsidies are supposed to pave the way for this. In some areas, a veritable competition has broken out in this regard. Even if this is understandable from a political point of view, from an economic perspective the disadvantages of such a competition outweigh the benefits.

The SARS-CoV-2 virus poses unexpected challenges for the global economy. Demand for goods collapsed, and supply declined because companies suddenly ran out of employees or intermediate products. As a result, economic indicators turned negative. However, although an economic recovery is now underway, uncertainty about future developments is still on a record high. This is due not least to global value chains. Their disruption was a major factor in the aforementioned distortions, but they are still central to local production.