This canter through the past, present and future of globalisation is a refreshingly open and hard-nosed look at where the global economy is headed. The post-Cold War era of global economic integration is over, replaced by a more contested and multipolar landscape. Technocrats in multilateral institutions with economics textbooks hold sway no longer. Geopolitics is shaping economics like never before. The US-China economic relationship may be unravelling in parts, but this does not mean an end to globalisation. Instead, we are seeing a splintering in the global economy as countries reassess their approaches to global trade, financial and capital flows, and prioritise securing access to resources and commodities.

“In a fractured world, friends will matter.” Who will ally with whom? How deep and how wide will the fractures go? What impact will all this have on growth and prosperity? Neil Shearing looks at the incentives and drivers on all sides. He reflects a good degree of nuance and complexity, even among ostensibly close nations.

The state globalisation has brought us to may well continue – in many sectors, at least – but in others there is sharp movement to diverge, and there are various ways this could play out. Countries differ in their economic compositions, resources and relative strengths. There are three critical concerns for policymakers that affect the extent of retrenchment and shifts away from cooperation and free trade: national security, supply chain security and technological leadership.

Shearing is a credible author in this space, as group chief economist at Capital Economics, and what he says makes a lot of sense. Ultimately, fracturing is a process that will be driven by governments but implemented by firms. We are already seeing firms responding, and responding differently across different sectors, consistent with the book’s narrative.

With well-explained reasoning, Shearing manages to navigate the changeable and uncertain outlook for the world. Given the rapidity of the trade picture changing, I felt myself checking the publication date, trying to figure out what the latest reference was, and wondering whether the book has been ‘overtaken by events’… and yet Shearing’s arguments are robust and stand, regardless of the vagaries of international politics or technological progress. He looks beyond current happenings and takes a long-term view, both on how we’ve arrived at this juncture and how it may pan out.

Why pick up this book? Well, economics bookshelves are not lacking for tomes relating to international politics, globalisation, or its faults (it has been over 20 years since Joe Stiglitz wrote a bestseller on globalisation and its discontents) and yet this book stands out as the first to talk about the splintering of the global economy. In it, we find out why we are unlikely to see significant reshoring to the US but, rather, shifts among the lower cost manufacturing countries. We look into why heightened price volatility, rather than sustained higher prices, is a likely outcome. I commend this book to anyone interested in how the global economy may look in 2040, in the forces shaping it and the many paths this fracturing could take, and to business or government leaders considering their next actions. It is a thought-provoking book and provides a roadmap for navigating our fracturing world.