Future 1: Walls up (and Down)

The evolution of globalisation

The year is 2025. One of the hallmarks of the post-WW2 world – the relentless dismantling of barriers to the flow of goods, capital and people – has evolved into a new breed of globalisation. In this future we produce, buy and interact much closer to home, but our brainpower becomes borderless.

Core features

  • The US-China trade relationship has only incrementally improved; global trade and supply chains have continued to shrink.
  • The strain on the world´s infrastructure for global collaboration has worsened; regional cooperation is states´ preferred mechanism for problem-solving.
  • Despite internal challenges, including the scar of Brexit, the EU´s relevance as a regional power grows.
  • Enabled by further advances in remote working, companies are moving to a borderless talent pool.
  • European white-collar workers increasingly opt to live in peri-urban and sub-urban areas; many more developing and emerging economy workers stay in their home countries.

The story

It’s the Fourth of July 2025, just a few months into the Kamala Harris presidency. The president and her husband are getting ready for the yearly fireworks display – like the Trump, Obama and Bush couples they’ll watch from the Truman balcony.

Provisionally pleased with the president’s inaugural Independence Day speech, her team is scouring social media for indications of reception. Keeping with tradition the speech was crafted to resonate broadly, not to score political points per se. But the Harris team is keen to check in on the state of connection with one voter segment in particular: the younger Republicans who have been leading their party’s long-awaited response to climate change.

Initially sceptical of the large levels of government intervention implied by New Green Deal, this group eventually became a core, if uneasy, ally for the Biden-Harris presidency. Repelled by Trump’s racist playbook and dismayed by the absence of credible Republican leadership on climate, this slice of GOP millennials felt they had no choice but to work with opponents to start the hard work of building American leadership in green economic growth. Harris’ slim win in 2024 owes a lot to collaboration with these kinds of voters.

The condition for their partnership? An important change in narrative. To this self-styled ‘eco-right’, it was critical that policy drew less on comparisons to the massive public works projects of the FDR era but rather on solidly free-market measures.

Plus ça change

Luckily for President Harris, the Biden administration had worked hard to court Republican allies – his team made it a hallmark policy to give fulsome recognition to Republicans leading on the green shift. Being able to take joint credit for the creation of thousands of decent-paying clean tech jobs put much-needed wind in bipartisan sails. In 2025, Harris means to reap this harvest, moving faster to decarbonise the US’s economy while creating good jobs for all.

China proved to be another significant political bridge-builder. Starting off with a one-vote majority in the Senate, and with many of his own party aligned with the prevailing Republican stance, Biden more or less continued his predecessor’s bullishness on Beijing (but with less belligerence, it has to be said). His so-called ‘foreign policy for the middle class’ had really one target – to protect American workers and industry from Chinese competition.

And so by 2025, trade restrictions are now five times higher than in 2018, when they started to rise dramatically as the US-China strife heated up.’  But ‘slowbalisation’ – as it was branded by one particularly witty newspaper – started long before, at the end of the 2008-09 recession (which closed the book on two decades of especially exuberant globalisation). Between 2008 and 2019, a range of indicators told the story of globalisation’s slowdown. Trade as a percentage of global GDP; multinationals’ share of listed firms’ global profits; cross-border investment and loans – all were already declining by the time Trump took office.

Multiple forces lie behind the explanation. One is that services, which make up an ever larger share of the global economy, are by definition harder to trade than goods. Another is that, after 2012, the cost of trade stopped dropping, making global sprawl less profitable, not least because local competition often ended up being feistier than anticipated. Also, technology was cancelling out the asymmetry in labour costs that had once made production in China so attractive. Plus, the 2020 pandemic forced businesses to get wise to shocks. Indeed, what they found was that shocks were actually rather mundane – with McKinsey advising companies to expect a month-long shut-down every 3.7 years. The remedy? Simpler, more transparent, more resilient supply chains that cross fewer borders.

Over the course of 2010-2025, the share of foreign investment in Asia from elsewhere in Asia increased from one-thirds to nearly two-thirds of the total. In Europe, intra-European foreign investment has risen to 70% of all foreign direct investment.

So in 2025 the global trade system is a patchwork of regional and bilateral arrangements revolving around three centres of gravity: the US, Europe and China. And India is gaining. Back in 1989, Nobel laureate Paul Krugman predicted that this was precisely the worst constellation for global economic governance. A lone, dominant economic power could impose common rules for liberalisation on everybody else; a handful of similarly-sized giants with different views on how to run the world economy spells fracture. Though the WTO’s ability to settle disputes has been reinstated (following its castration by Trump), a lot of ground has been lost. 

Over history, globalisation has ebbed and flowed. But for now, the tide is out.

What we take for granted

Power and capital tend to go hand-in-hand. The regionalisation of global commerce has thus been mirrored by greater regionalisation of international relations. And as we move from global to regional problem-solving, the multilateralism that defined the post-war era is getting creaky, just like a car that doesn’t get used.

The US is back at the table (‘at the head of the table’, in Biden’s words), engaging constructively with the Paris Agreement and with critical institutions like the World Health Organisation. But the UN Security Council, the main engine of global security cooperation for the last 70 years, has quarrelled itself into irrelevancy. The veto-wielding permanent members of the Security Council – China, Russia, the US, France and the UK – struggle to find common ground on anything. This discord is now seriously colouring other parts of the UN system.

A tragic hangover from the 2020 pandemic is an erosion of democratic governance and respect for human rights in a slew of places, from Hungary and Hong Kong to Cameroon and Cambodia (to name just a very few). While the world was distracted by the virus, authoritarian regimes exploited the moment to shore up power, curbing the media, suppressing opposition and in some cases abusing civilians.

Now would have been the time for robust, truly global problem-solving. Instead, capitals look to allies in their region for more ad hoc assistance. When China rattles its sabre at Taiwan, the US turns to Australia for a partner with which to carry out shared naval exercise near the South China Sea.

The trouble with multilateralism is that so much of it is invisible – and therefore easy to take for granted. And in 2025 businesses, especially the scale-hunters of the tech sector, are feeling the strain of a less open, less friendly global order in which the rules are less steady.

Ahead of the pack, but challenges within

In the regionalisation game, the EU has a 75-year head-start over its peers to the east and west. In Asia, the Regional Comprehensive Economic Partnership brings together 15 countries and covers over 30% of global GDP. Yet most of the bloc’s members don’t trust China, putting a brake on any of the deeper collaboration evident in the EU. And in North America, USCMA – the successor to NAFTA – remains similarly limited in scope.

And yet the breadth and depth of European integration has also proved to be a ball-and-chain. Though Brexit (as predicted) hurt the UK more than it hurt Europe, it left a scar. With one exit out of the bag, would-be leavers from other countries have a precedent to point to when Europe’s troubles make the headlines – whether it is outbursts of populist rancour in Sweden or France; the values clash with Hungary (Orban is still in office in 2025); or lingering bitterness between Germany and Greece over the austerity measures implemented after the 2008-09 crisis.

Despite these troubles, member states recognise more than ever how much of their global influence and prosperity at home depends on EU membership. The single market gives individual countries access to 500 million customers, more than the US. And saddled between the US and China, going it alone would be foolish.

In the late 2020s China is set to become the largest economy in the world, ending the US’s eight-decade reign. This makes the EU an indispensable ally to Washington – the US simply needs Europe on side to weigh in next to the dragon. At the same time Europe maintains good relations with China. In 2025 Europe has built a position as a global balance point, helping to absorb tension between Beijing and Washington while providing hope that the best of both worlds is possible. To many, Europe is proof that it is possible to reconcile the Enlightenment’s legacy of individualism with the collective good.

Bright lights, big city, no thanks

Among the many experiences that left a mark during the pandemic was the unpleasantness of living in a major metropolis during lockdown. A survey taken in November 2020 by British engineering firm Arup found that 40% of residents living in London, Paris, Milan, Madrid and Berlin contemplated moving away from urban centres. For them, the drawbacks of population density and lack of easy access to green outdoor spaces started to loom larger than the proximity to cultural attractions and other perks of city life (which a lot of people didn’t have time and in some cases money for anyway). And when European businesses sent 70 million staff home to work, a suddenly small need to be in the city overlapped with a growing desire to leave.

Falling into this category were Henrik Lahm, a senior manager for an international medtech company, and his wife Irene Hummels, a rising-star project manager at a publishing house. When both their employers confirmed in 2021 that they would reorganise permanently around a more remote model, the couple leapt at the chance, switching out pricey Munich for a quaint and much cheaper town close to the border with Austria. Both avid skiers and mountaineers, they were keen to free up time both for these pursuits and for raising the daughter they were expecting.

They were not the only ones that made the move. Initially the locals viewed the influx with irritation – rising housing prices got their backs up. But recently, the bitterness has subsided as the new arrivals have shown strong community engagement. Henrik volunteers at a local care home, where he plays music for the residents; and Irene coaches a Nordic ski team at a nearby school.

This community engagement is part of a larger pattern that started taking shape in 2020. Just a few months into the pandemic financial services company Legal & General reported some remarkable numbers: in the UK alone 10 million people were carrying out voluntary work in their communities; 78% said they would continue after lockdown; and 64% of respondents said that ties in their community had strengthened.

When multinational businesses moved their executives around every 36 months or so, there was little incentive to connect meaningfully with the communities they were posted to. With more time in one place, white collar workers are regaining a sense of place.

You work where?

By 2025, Henrik’s company has 70% of its workforce ‘working from anywhere’ (WFA). He himself works from home (or the library) four days a week. A few times a month he switches it up to meet with colleagues who happen to live close by. They rent space at one of the local co-working spaces that have become a common feature of suburban towns. Henrik pays for the room with his work-from-home allowance, which at a fraction of his travel and expense budget of yore helps cover his internet, mobile phone, heating and electricity.

Henrik’s firm has been able to learn from a range of early movers. Before 2020 had even ended, a cast of huge brands – from Facebook and Twitter to Siemens and State Bank of India – had already decided they would stay remote, even after a vaccine had been rolled out. IT services giant Tata Consultancy Services, with over 400,000 employees, had announced it planned to be 75% WFA by 2025, but reached the target a year early. In practice this means that employees spend no more than 25% of their time in the office; and that the company never has any more than 25% of workers co-located.

In a way, the success of the 2020 remote work experiment seemed to take business by surprise. On Unilever’s second-quarter earnings call of that year, CEO Alan Jope reported a 41% increase in productivity, a 20% increase in internal collaboration time, a 19% increase in external meeting time and a 14% rise in employee well-being.

As businesses built confidence in their ability to operate a remote model, they also seized an opportunity to cut expenditure on commercial real estate. With many companies downsizing urban office space or exiting all together and retail going full guns online, commercial real estate suffered a glut. The hit was especially severe in Europe, where leasing demand for office space dropped by 40% during the first three quarters of 2020 before reverting to pre-pandemic trends and then hovering through to 2025.

The hybrid talent model looks different for different companies. And not all the experiences are positive. Analysts question the productivity numbers being reported. And mental health has taken a hit as workers’ isolation increases. The silver lining is that employers are doing a radically better job of reducing the taboo around conditions like depression and anxiety – a shift for which mental health campaigners have been agitating for decades.

The next frontier

Henrik has a front-row seat to the transformation of the talent paradigm. Indeed he is participant in the shift to a borderless model: his primary role is to source talent for his fast-growing company, both in Germany and abroad.

His team initially made a play for talent in the UK, given the high education and skill levels of British workers. But a post-Brexit legal wrangle forced them to look elsewhere. He has heard Henrik and his colleagues are now succeeding in building strong partnerships with recruiters in developing countries, particularly Kenya and Rwanda. Not only is there a good stream of competitive, high-calibre talent in these geographies; hiring from these markets is helping the company make progress on its diversity ambitions. 

It turns out the new talent model may be slowing the decades-long brain drain that has been depriving developing and emerging economies of its most highly educated brains. Pre-pandemic, Africa was losing 70,000 skilled professionals every year, fleeing from stark job scarcity. The borderless model means that they can gain meaningful employment while staying in their home country. It’s too early to tell, but the development community is picking up early signals that (assuming good governance) the gain from taxes and local spending could outweigh the loss in remittances. 

Developing and emerging economy talent have another reason to stay home from some countries: the rise of politicians employing xenophobic narratives.

The reverse brain drain would not have been possible without the radical expansion of low-cost, higher-quality internet access in developing economies – which for urban populations increased from 65% coverage in 2019 to 85% in 2025. This coverage is estimated to have added USD 2 trillion to the world’s GDP and created more than 140 million jobs around the world.

As companies deepened their implementation of the more remote model, other benefits beyond cost-cutting quickly manifested. Many firms reported lower attrition. This isn’t just because employees are happier but also because some workers who have chosen to settle in less urban areas don’t have many other options.

In 2023 little Elena was born. After Irene took her share of the parental leave, she handed over Elena’s daily care to Henrik and went back to work. She was feeling a bit apprehensive – her older sister had told her stories (the stuff of nightmares) about juggling motherhood and her job. But once she got going again, Irene found the balance not just manageable but actually enjoyable – something she chalked up to being able to avoid the sanity-sapping sprint between home, office and kindergarten her sister had endured. Surging with motivation, Irene scored the promotion she had her sights on, along with a nice pay rise, just a few months after starting work again.

Flights of fancy

Before they got married and had Elena, Henrik and Irene travelled extensively. With ample disposable income, they could afford to fly for a long weekend to almost any city in Europe.

They also flew regularly to Turkey, the home country of the maternal branch of Henrik’s family. His grandmother immigrated to Germany in the early 1960s, married a German and worked as a music teacher all her life – it was she who had taught Henrik to play the piano. Unfortunately, her health wasn’t strong and she fell among Germany’s early covid victims. Their last flight was actually with her, a birthday gift to enable her to visit with friends and family in her hometown.

It wasn’t until 2025 that Henrik and Irene took to the skies for their first ever flight as a family – to visit Irene’s sister in Marseille. Both Henrik and Irene have flown once or twice a year for business, and then only to another European city – a dramatic change from when Henrik needed to fly to Singapore three or four times a year. Otherwise, they have been surprised to find out that they have grown quite fond of road-trips.

On one of their evenings in Marseille, Henrik and Irene leave Elena with her aunt and hit the town. They catch a play at Le Silo and eat an exquisite meal in Le Panier. Their southern German town is no cultural backwater – many artists, too, have left cities for more remote areas, creating surprisingly rich art, music and theatre scenes away from urban centres. But as Henrik and Irene amble around the Cours Julien district, they are forced to agree: cities have that special something.

After a few days in the German capital, the small family is ready to come home. While sitting at the airport waiting to board, Elena asleep in her lap, Irene catches sight of Kamala Harris’ face on a CNN news clip. The ticker tape along the bottom of the screen scrolls: ‘President Harris, America’s first female president, gives Independence Day speech from the South Lawn’.

It takes her back to something she remembers reading in late 2020, when pundits had had a chance to evaluate the crisis leadership of the world’s leaders. They said that female leaders – like the president of Finland and the prime minister of New Zealand (not to mention Mutti) – had on balance done a better job of steering their societies through the crisis. One theory was that they made better calls because women were less likely than men to accept risk on behalf of others.

Interrogating the theory, she wonders whether the world would be a better place if leaders forced less risk on others. Then she turns the question on herself. ‘Do I impose risk on others?’ Unsure of the answer, but certain it is a good question, she resolves to carry it with her into the team meeting she is leading on Monday.

Signals of change

While the story above is fiction, it is inspired by real-time trends. The following ´signals of change´ connect the scenario to current trends.

Trade barriers: Higher walls, fewer gates

Since WWII, powered by the principle of comparative advantage, international trade has mostly flourished – enabling an average rise of 3.6% in global GDP per year. But this trend recently hit a wall, with global trade barriers hitting a seven-year high in 2019. The US-China trade dispute is a key contributing factor, estimated to be slowing global growth by almost 1% in 2020. With Brexit still just on paper, Europe has its own new barriers to contend with.

Scenario 1 subsection 5

Supply chain innovation: technology plus covid equals resilience

Covid has laid bare the fragility of lean and sprawling global supply chains – 94% of Fortune 1000 companies report have been affected by supply chain disruptions during the pandemic. The emerging response to this shock – building supply chain resilience, diversifying manufacturing sites, and reducing reliance on imports – is intersecting with a pre-pandemic, technology-driven trend towards reshoring and onshoring. Companies like Adidas, Nike and Sennheiser had already relocated parts of their production closer to their customer base to expedite delivery. Now more companies are expected to follow suit – 64% of US manufacturers seeing diversifying their supply chain as a likely outcome of the pandemic.

Supply chain innovation

Multilateralism: the big squeeze

Last year, the United Nations faced a cash-flow crisis and had to cut hiring largely because a number of countries had not paid their annual dues. The squeeze continued in 2020 with a USD 5.1 billion shortfall. Other multilateral organisations are suffering too, not least due to the disengagement (or outright exit) of its most powerful player from a range of key bodies, among them the Paris Agreement, the UN Human Rights Council, the Trans-Pacific Partnership (TPP), the World Health Organisation and the World Trade Organisation. With a new president in the US, it is hoped that multilateralism will recover its footing, but some damage may have already been done.

Scenario 1 subsection 2

Human settlement: won’t you be my neighbour?

Because of covid, 14% of Londoners want to leave the city permanently. Commercial real estate in large cities, from New York City to Melbourne, has taken a hit. The pandemic has accelerated the shift from physical stores to digital shopping by roughly five years, while office vacancy is set to increase by almost 5 percentage points globally in the next two years. Shopping centres and out-of-town retail is crumbling – somewhat surprisingly independent shops are faring better than chain-owned outlets, with closures of 0.5% versus 2.8%.

Scenario 1 subsection 4

Working from home: a paradigm shift

In 2019, only 5.4% of employees in the EU worked from home, while early estimates from suggest a rise to almost 40% as a result of covid. Globally, the percentage of permanent remote workers is set to double, from 16.4% in 2019 to 34.4% in 2021. While the focus in the homeworking revolution has been on white collar workers we are also seeing the ‘uberisation’ of lower skilled tasks and the rise of ‘crowd work’.

Scenario 1 subsection 3

Airlines, travel and tourism: still going places – just not far away

In 2018, business-travel spending exceeded USD 1.4 trillion—21.4% of the global travel and hospitality sector. By April 2020, available seat miles on US airlines had shrunk by about 70% from 2019 levels – a decline nearly four times greater than after 9/11. Since mid-March, US air travel dropped 95% from over 2 million daily travellers to less than 100,000. Those travelling for leisure at all in 2020 are focusing on shorter trips – and they are mostly driving. Governments worldwide have provided more than USD 160 billion of support to keep the sector afloat; despite these efforts more than 40 airlines had gone bust as of October 2020.

Scenario 1 travel
It took a pandemic to stop me flying around the world, and it’s taken a pandemic to get people to deploy lean management techniques they’ve known about for years but never implemented.

Rick Haythornthwaite, Chair-Elect of Ocado, Chairman of Xynteo, former Chairman of Mastercard