The standardization of steel shipping containers in the 1950s revolutionized many industries.

Because of the containers it became possible to transport things more efficiently, which created the possibility to assemble products on one continent while selling them on another. In other words, the modern container was the key to unlock the potentials of the globalization process.

For decades, this lowered the price of commodities, while the oceans and the sky were filled with ships and plans transporting clothes, furniture, toys and home electronics from factories in Asia to department stores and shops in Europe and the US. 

Globalization made the world smaller, but it also made it more mechanical, as though it wasn’t anything more than a supply chain in which containers could be endlessly shipped over vast distances.

The Covid-19-pandemic showed how vulnerable the system was. When not only individual countries but entire continents went into lockdown, supplies of everyday goods became scarce.

At the same time, people who were isolated in their homes began shopping online to a much larger extent than before, which raised the demand for many items.

As there were not enough container ships to meet this new need, the cost of shipment increased rapidly. When the pandemic was followed by Russia’s invasion of Ukraine, the situation worsened. 

In the spring of 2022, American Treasury Secretary Janet Yellen stated that, “Our supply chains are not secure, and they’re not resilient. And I think that’s something, in terms of long-risk to the US and to other countries, that’s a threat that needs to be addressed.” She was not alone in this sentiment.

Already after the 2008 economic crisis, many companies began to rethink the values of globalization, to instead explore an older and more tradition concept, that of regionalization.

Briefly summarized, this means bringing manufacturing and consumption geographically closer together. Producing goods closer to where the consumers are eliminates unnecessary transports, which is not only more efficient but also better for the environment. 

Today, this is not merely a prognosis of what might happen in a distant future, but an outline of a shift that is already occurring.

During the last decade, companies have moved factories closer to consumers.

One important factor that once drove production to Asia was the high cost of production in Europe, but today salaries in China have reached the same level as in Portugal and Greece, while at the same time many jobs have been automated. 

Many consumers don’t consider where their goods are produced.

What they do care about, is that it is available online and that it arrives on time.

This desire for smooth transports is one of the strongest driving forces in the shift from globalization to regionalization, turning “locally produced” from a meaningless buzz word into a signifier of the current paradigm shift happening across the world.