The awakening to a new world

What we previously believed to be merely a localized pandemic wave has now become an enigmatic global political and economic confrontation. We are witnessing the formation of a new context, in which “old” trends have now become real and necessary in order to establish an alternative and safe path for the recovery of our businesses.

It is clear that the importance of a digital environment for companies is the first step toward better adaptation to this scenario, accompanied, of course, by a more competitive global value chain in which the international landscape is used broadly and strategically. These are only some examples that can strengthen corporations and prevent them from being exposed to the market or overly dependent on it.

To date, we are certain that there will be a contraction in the economic sphere of major and hegemonic international partners, such as China, where the smallest contraction among the major powers is expected—around 1%—compared to the United States and the European Union, at 3% and 4.4% respectively, according to Euromonitor data.

Although still uncertain, we must reflect on these numbers strategically, bringing into focus a new trend that is emerging and will not take long to reappear. Although on a smaller scale, protectionism will be present in this new form of globalization, introducing domestic priority agendas that were severely exposed and revealed their fragility. This can be observed in the Global Real GDP Growth Forecast 2014–2022 chart, updated this April by Euromonitor International Macro Model.

The post-international scenario will require new markets in order for risk factors to be mitigated and, as they develop, to present sustainability in a relationship of consumption and responsibility between the domestic and foreign markets.

It is worth emphasizing that opening new areas of interaction does not mean that we will undergo a blind and immediate migration to new markets. The exercise of seeking alternative paths makes it clear how important it is to be prepared for any kind of eventuality that may occur, such as economic and sanitary sanctions, for example.

Finally, but no less important, the demand for minimally sustainable products will gain strength and become a vital decision-making factor for consumers, as well as an appeal to society, which reinforces adaptation and respect for a moment that is being shaped as promising and responsible, regardless of where it may be rooted.

Arthur Martinho – International Vice President of IBREI