Special Issue on ‘Global Trade and FDI: The Road Ahead’

Date01 August 2022
Published date01 August 2022
Subject MatterEditorial
Special Issue on
‘Global Trade and
FDI: The Road Ahead’
The world’s geopolitical landscape has never been more dynamic. Environmental
pressures and disruptions to the global economy have driven researchers to re-
examine the links between globalisation and emerging threats. The current special
issue touches on some issues related to the challenges in front of globalisation,
economic connectivity and economic development for human prosperity. We ask
the question what does a post-COVID-19 world look like in terms of trade and
investment flows? What is the future of economic connectivity and what are poli-
cies that would lead to improvements? We inquire about putting in perspective the
wide range of challenges economies are facing in the year 2022: disruptions and
uncertainty in global trade and investment flows; environmental implications of
international economic activity; accelerating automation of production that leads
to falling labour shares and increasing income inequality in the context of an
interconnected world. The issue contains five articles and one book review by
international scholars.
The first article by Canh Nguyen and Su Thanh (Canh & Thanh, 2022) inves-
tigates the dynamics of export diversification, economic complexity and eco-
nomic growth cycles. The authors apply several advanced econometric techniques
to estimate the relationships among the variables for a global sample of countries.
They find a Granger bidirectional causality between economic complexity and
export diversification, and a unidirectional Granger causality exists from eco-
nomic complexity to economic growth cycles. A three-stage least squares method
demonstrates that economic complexity and export diversification significantly
impact each other, and the dynamics of economic complexity and export diversi-
fication reduce economic fluctuations. The authors also find that the negative
impact of economic complexity on economic growth cycles is statistically signifi-
cant only for high-income economies.
The second article by Nidhi Bagaria (Bagaria, 2022) pays attention to the
increasing trade in intermediate goods dues to the wider spread of global value
chains (GVCs). With China emerging as one of the leading countries in the global
GVC network, there is a heavier reliance on Chinese intermediate goods for the
manufacturing sector. The outbreak of COVID-19 and the subsequent lockdowns
in many countries, including China, have disrupted the supply of GVCs and have
led to a search for alternative markets for intermediate goods. The study by Nidhi
Bagaria explores how India can substitute for China as an alternative avenue for
Foreign Trade Review
57(3) 231–233, 2022
© 2022 Indian Institute of
Foreign Trade
Reprints and permissions:
DOI: 10.1177/00157325221095995

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