Globalization remains at a historically high level – despite escalating geopolitical tensions and US tariffs, according to the latest edition of the DHL Global Connectedness Report 2026, published on 10 March.
The report, written in partnership with New York University’s Stern School of Business used more than 9 million data points to track international flows of trade, capital, information, and people.
It uses a scale from 0% (no cross-border flows) to 100% (borders and distance have no impact). The world’s level of globalization was 25% in 2025, in line with the record high set in 2022.
DHL Expreess chief executive John Pearson, said: “The DHL Global Connectedness Report shows that countries and companies are not retreating behind national borders. That is good news. DHL strengthens global ties by connecting markets, businesses, and people so they can adapt, diversify, and unlock new opportunities – even in uncertain times.”
At the same time, today’s globalization level of 25% underlines how far the world is from being fully globalized. In many areas, international flows could expand further in the absence of policy constraints.
Global trade grew faster in 2025 than in any year since 2017, excluding the volatile Covid-19 period. US importers accelerated shipments early in the year ahead of tariff increases but they later dropped below prior-year levels. However, rising Chinese exports to non-US markets helped sustain global trade volumes. Trade in AI-related goods surged as countries and companies raced to build data infrastructure.
Looking ahead, recent US tariff increases are expected to modestly slow trade growth in 2026 – but not stop it. Global goods trade is projected to expand by an average of 2.6% per year through 2029, in line with the past decade.
In fact, most trade does not involve the US In 2025 – 13% of imports went to the US, and 9% of exports came from the country In addition, many countries are pursuing new trade agreements to secure access to alternative markets.
There is no broad shift of investment from foreign to domestic markets, said the report. Multinational firms still earn near-record shares of sales abroad. While announced greenfield foreign direct investment (FDI) fell in 2025, overall FDI flows rose, and cross-border M&A activity remained resilient.
In the report’s country ranking, Singapore again ranks as the world’s most globalized nation, followed by Luxembourg and the Netherlands.
Europe is the most globalized region, followed by North America and the Middle East and North Africa. The UK has the most broadly distributed flows worldwide. The United Arab Emirates recorded the largest increase in globalization since 2001.
The report did find that ties between the world’s two largest economies – the US and China – continue to weaken. However, these ties are surprisingly small in a global perspective. For example, trade between the US and China accounted for 3.6% of world trade at its peak in 2015, before falling to 2.7% in 2024 and to only 2.0% during the first three quarters of 2025.
Even as the US and China decouple, most countries continue to engage with their longstanding partners. Over the past decade, only 4-6% of global goods trade, greenfield have shifted away from geopolitical rivals. Of these flows, most have not moved to close allies but to countries with flexible geopolitical positions, such as India and Vietnam. Overall, the world economy remains far from a broad split into rival blocs.
Report author Professor Steven Altman, director of the DHL Initiative on Globalization at NYU Stern’s Center for the Future of Management said: “The politics and policy surrounding globalization are much more volatile than the actual flows between countries. Global trade patterns changed more in 2025 than they do in a typical year, but less than they did during other recent disruptions such as the early stages of the war in Ukraine. Sound decision-making requires a calibrated view of how much global business ties are really changing. The risks to globalization are real, but so is the resilience of global flows.”
Geopolitical tensions and supply chain concerns have led many observers to expect a shift from globalization to regionalization. In 2025, however, traded goods traveled the longest average distance on record (5,010 kilometers).
