The shift towards digital globalization

Obituaries to globalization bannered front pages worldwide as the pandemic took hold. The interdependence of economies, cultures, and populations, brought about by cross-border trade in goods and services, technology, and flows of investment, people, and information, was seen as seriously threatened by Covid-19.

The DHL Global Connectedness Index – which we released in December – told a different story. It measures globalization based on over 3.5 million data points on trade, capital, information, and people flows. That last item – people flows – was the only part of the index that showed an unprecedented collapse due to Covid-19. Trade has rebounded strongly, capital flows are recovering, and digital information flows have surged.


Still, a worldwide surge in Delta variant cases has renewed lockdowns all over and the threat of new strains has made nations rethink the long-haul implications of the pandemic on trade and globalization.

One aspect of the DHL Global Connectedness Index that has continuously surged is information flows. International internet traffic soared 48 percent from mid-2019 to mid-2020 and cross-border e-commerce sales of discretionary goods spiked 53 percent in the second quarter of 2020. There is no sign of this tapering off.

We are witnessing the birth of digital globalization, fostered by digital technologies and characterized by accelerating and increasing flows of data and information. Global data flows are surging and digital platforms have allowed more countries and smaller enterprises to participate.


Behind digital globalization is digital trade, which captures not just online sales of products and services but also data flows that enable global value chains, services that enable smart manufacturing, and a myriad other platforms and applications.

Global e-commerce, which involves the sale of products or services across geopolitical borders, grew by 27.6 percent or $4.28 trillion in 2020 according to eMarketer. Two years ago, only 13.6 percent of sales involved online purchases. That number is expected to reach 19.5 percent in 2021, a 45.8-percent increase over two years. Growth is expected to continue, reaching 21.8 percent by 2024, which translates to an 8.2-percentage point increase in just five years.


Another aspect of digital trade is products and services ordered and delivered via the internet, which includes software, music, audio, video, games, and text downloads; music, video, and video game streaming; other internet content such as news, social media, searches, ads, email, etc.; software as a service such as email apps; cloud computing; digitized financial, business, subscriptions, and entertainment services; and emerging technologies including artificial intelligence and blockchain.

One manifestation of the reduction in global travel is the astounding increase in video conferencing, which saw a 535-percent rise in daily traffic last year. The projected value of the global videoconferencing market for this year is $6.03 billion. It is projected to grow on average by 11.45 percent from 2020 to 2026, reaching $9 billion by 2026, according to Zoom was one of the fastest-growing apps of the pandemic, with meeting participants increasing by 2,900 percent.


International internet capacity saw growth of 35 percent in 2020, according to new figures published by TeleGeography. In fact, the internet saw capacity grow from “around 450 terabytes per second (Tbps) to over 600 Tbps” between 2019 and 2020.

Digital trade will usher in a new era in globalization. The growth spurt in digital services will be sustained in the long term, driven by changes in consumer and business behaviors. A hybrid work model – a combination of remote and onsite work – is already being planned by businesses all over the world. Nations, companies, and organizations are accelerating their digital transformation journeys, which will further increase the use of digital services.

Digital globalization is the new paradigm.

The author is the CEO of Hungry Workhorse Consulting, a digital and culture transformation consulting firm. He is a Fellow at the US-based Institute for Digital Transformation and teaches strategic management in the MBA Program of De La Salle University. He can be e-mailed at