Magazine article Global Finance

Economic Populism Boosts Ecommerce

Magazine article Global Finance

Economic Populism Boosts Ecommerce

Article excerpt

The Trump campaign in the United States and the UK's Brexit movement put forth renewed calls for economic policies with potential to limit or reduce cross-border trade. A variety of measures have been suggested, such as renegotiation of some trade deals, suspension of others, higher taxes and tariffs on imports.

Yet if traditional cross-border trade is under global attack, crossborder commerce through the Internet is growing. Market research firm eMarketer expects retail ecommerce sales will reach $1.9 trillion in 2016 and $4.1 trillion in 2020, making up 14.6% of total retail spending by then. At the same time, according to the WTO, 2016 saw the slowest global trade and output growth since the financial crisis.

The current political atmosphere, in fact, lends itself to ecommercewhich companies already prefer to the expense of brick-and-mortar. First, if companies in the Western world, especially in the US, go back to local manufacturing, that will put greater physical distance between producers and foreign target markets. Renegotiated or new trade agreements will provide countries the opportunity to include new rules that reflect the rise of digital commerce.

"Regardless of political sentiment, advances in shipping technology have removed the complexities of cross-border trade, making international expansion easier for small to medium-sized businesses," notes Carl Hartmann, co-founder and CEO of Temando, a shipping software company.

Second, the concept of "America First," the leading theme of the new US administration, and populist political and economic sentiments in Europe bring back brand nationality. …

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