ADDIS ABABA UNIVESITY

PHILOSOPHY OF INTERNATIONAL BUSINESS AND STARATEGY

INTERNATIONAL BUSINESS ENVIRONMENT COURESE

Article review- Individual Assignment 1
On DE-GLOBALIZATION

Tesfamaryam
De-globalization and Decoupling: Game Changing
Consequences?

Witt etal, 2021 Definition:

Globalization is commonly defined in IB as the process of
increasing interdependence among nations
(Chase-Dunn et al., 2000; Guille´n, 2001; Meyer, 2017; Rugman &
Verbeke, 2004; Verbeke, Coeurderoy, & Matt, 2018)

Antecedence of DG reemergence of China and its entry into the

World Trade Organization (WTO) in 2001
COVID-19 pan-demic –its catastrophic consequences that was–
triggered a separate and independent strategic reevaluation of
global value chains (GVCs) as a critical element of both
international trade and foreign direct investment.
The author askes
questions

1. What are the most salient contextual forces driving the trend toward de-
globalization and global decoupling (e.g., geopolitical conflicts, GVCs or global
supply chains, reshoring and relocation of manufacturing hubs, software
development, electronic payment, platformization, and ecosystems)?
2. How can multinational enterprises (MNEs) headquartered in liberal democracies
or state capitalist systems best adapt and respond to these emerging dynamics?
De-globalization has attracted growing attention across economics,
political science, international business, and strategic
management.
The centrality of politics as a driving force behind de-globalization
is explored in this section.
The essay discusses how technological advancements enable
globalization, but political decisions ultimately shape the extent to
which firms and individuals can benefit from these opportunities.
Drawing on insights from political science theories, particularly
liberalism and realism, the essay analyzes their perspectives on the
causes and mechanisms of de-globalization
CONCLUSION

COVID 19- pandemic has triggered a strategic evaluation of the

status of globalization, including both international trade and
direct foreign investment.
De-globalization: Theories,
predictions, and opportunities for
international business research
De-globalization, now a distinct possibility, would
Michael A. Witt, 2019
induce a significant qualitative shift in strategies,
structures, and behaviors observable in international
business (IB).
 political science, liberalism and realism, predict de-
globalization
liberalism suggests a patchwork of economic linkages,
while realism predicts the emergence of economic blocs
around major countries.
• For political strategies and roles, there is a need to
explore how regular business activities and deliberate
political agency of MNEs affect the political
sustainability of globalization.
• For value chains, questions include their future reach
and specialization, changes in organizational forms, and
the impact of political considerations on location
decisions
Springboard MNEs under
de-globalization
(Luo and witt, De-globalization refers to the weakening interdependence among
2022) nations, which erodes the ability of EMNEs to acquire strategic
assets through cross-border mergers, acquisitions, and alliances.
This reduction in interdependence disrupts the traditional spring
boarding process and necessitates a reevaluation of EMNE
strategies.

the difficulties faced by EMNEs in acquiring global open resources

and strategic options under de-globalization
The authors argue that the impact of de-globalization on EMNEs is
not uniform, favoring companies from some countries while
disadvantaging others
How to address
challenges ?

To address the challenges posed by de-globalization, the article proposes a

concept called "double-loop spring boarding
It involves leveraging both conventional inward internationalization modes
and new modes such as co-development, R&D consortiums, joint ventures,
and platform sharing
Reconfiguring Strategies:
the importance of reconfiguring strategic postures for EMNEs in response to
de-globalization.
EMNEs need to search for new and viable configurations, which may involve
altered location choices, geographical diversification, different entry modes,
and partner choices and focus on designing risk and exposure management
strategies