High costs causing globalization rethink

Aug. 3, 2008 at 2:42 PM
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NEW YORK, Aug. 3 (UPI) -- Rising shipping prices, along with increasing political and environmental concerns, may be slowing economic globalization's momentum, analysts say.

While the U.S. marketplace is used to a plethora imports at retailers such as Target and Wal-Mart, the costs of maintaining the fuel-dependent global supply chain may be getting too much to continue the march toward globalization, The New York Times reported Sunday.

"If we think about the Wal-Mart model, it is incredibly fuel-intensive at every stage, and at every one of those stages we are now seeing an inflation of the costs for boats, trucks, cars," Naomi Klein, the author of "The Shock Doctrine: The Rise of Disaster Capitalism," told the newspaper.

Other experts say companies will try to cope with the higher costs by keeping production of goods closer to the end markets, with global supply shipping chains making less sense than previously.

The breakdown of multinational effort to complete the Doha round of world trade talks last week also showed that protectionism, especially among emerging economic superpowers India and China, is still strong and not likely to be overcome anytime soon.

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