Deglobalization, derisking deregulation: Crack the 3D

Nations must navigate all three well to balance their openness with resilience and global integration

- ANURADHA GURU & PRACHI MISHRA

When flight attendants instruct passengers to secure their own oxygen masks before helping others, they acknowledge a fundamental truth: In times of crisis, self-preservation must precede collective action.

Today's global economy faces a similar moment of reckoning. As nations grapple with supply-chain vulnerabilities, geopolitical tensions and economic uncertainty, they are increasingly adopting a 'mask-first' approach, prioritizing domestic resilience over global integration.

This shift manifests through what we call the “Three Ds’: deglobalization, derisking and deregulation. While these trends dominate policy discussions worldwide, their actual impact varies significantly between rhetoric and reality. Understanding this distinction is crucial for navigating the new economic landscape and identifying opportunities amid apparent fragmentation.

Despite widespread talk of de-globalization, the data tells a more nuanced story. World merchandise trade reached an all-time high in 2024, at close to $25 trillion, driven partly by the AI boom that has led to explosive demand for technology exports, particularly from Asia. Taiwan and China have emerged as critical suppliers in this new economy, while services trade continues to show remarkable resilience. The overall imports of services from the US registered a record high of $841 billion in 2024 and a figure of over $200 billion in the first quarter of 2025. DHL’s Global Connectedness Index, which measures international flows of trade, capital, information and people relative to the size of domestic activity, was at a record high of 25% in 2022 and 2023, with a number in the same range projected for 2024.