Analyst: US Declaration Signals End of Globalization
The United States' declaration at Davos that "globalization has failed" signals a massive structural shift away from the liberal world order, according to Rabobank's Michael Every. In a recent podcast, Every argued this pivot towards more nationalist economic policies will reinvent global supply chains and strategic alliances. This shift is expected to drive a greater focus on domestic resilience in areas like housing and material sourcing.
- A core tenet of the "America First" model articulated at Davos is that offshoring essential sectors like medicines and semiconductors weakens national sovereignty and that key supply chains should be restricted to a nation's "best allies." This represents a direct challenge to the decades-long model of seeking the cheapest labor and production costs globally, a practice that critics argue has hollowed out domestic industries in the U.S. and the West. - In response to global supply chain disruptions and geopolitical shifts, the European Union is advancing its own version of economic nationalism through the Green Deal Industrial Plan. This plan includes the Net-Zero Industry Act, which aims for the EU to produce at least 40% of its required net-zero technologies by 2030, and the Critical Raw Materials Act, which sets targets for extracting, processing, and recycling key materials within the bloc. - The Netherlands has set a goal to achieve a 100% circular economy by 2050, with a 50% reduction in the use of primary raw materials like minerals, fossils, and metals by 2030. This national strategy directly impacts the construction sector, which is responsible for half of the country's resource consumption and faces the dual challenge of reducing its footprint while also building an estimated 75,000 new homes annually to address a severe housing shortage. - To accelerate the transition, Dutch policy promotes circular procurement in construction through tools like the Circular Building Index and the National Environmental Database (NMD). Despite these efforts, only 8% of materials currently used in the Dutch built environment come from secondary sources, highlighting a significant gap in achieving circularity goals. - The Dutch housing crisis, marked by a deficit of approximately 401,000 homes in 2024, is exacerbated by supply chain constraints alongside regulatory and environmental issues like nitrogen emission rules. This has driven the average home price to €452,000, over ten times the average salary, making the shift to localized, circular material sourcing a critical component of addressing affordability. - A key innovation supporting the circular construction goals in the Netherlands and beyond is the development of "material passports." These digital documents track the materials used in a building, making it easier to disassemble, reuse, and recycle components at the end of the structure's life, effectively turning buildings into material banks for future projects.
