April 19, 2022—As the IMF warned of a slowdown in the global economy, its staff pointed to a larger issue likely to impact economies around the world for years to come. That issue is the reversal of globalization, which has been in place for decades.
Pierre-Olivier Gourinchas, IMF Economic Counsellor and Director of the Research Department, described it as such:
“The war also increases the risk of a more permanent fragmentation of the world economy into geopolitical blocks with distinct technology standards, cross-border payment systems, and reserve currencies.”
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