Singapore remains the most globalized nation in the world, according to the 2006 A.T. Kearney/FOREIGN POLICY Magazine Globalization Index™. American technological connectivity, however, has helped the U.S. move into the third place in the annual study which assesses the extent to which the world’s most populated nations are becoming more or less globally connected. Switzerland took over second place. Iran remains at the bottom of the list, where it has been for the past six consecutive years.
Some days, it seems the world is falling apart at the seams. Yet globalization has proven to be highly resilient, despite tensions and even violence from military actions, trade disputes and cultural/religious/ethnic differences. It even expanded in some unexpected ways, with Internet usage spiking in such unlikely places as Indonesia, Morocco, Nigeria and Senegal. Overall, global trade grew by 10.3 percent, while foreign direct investment increased by 6 percent.
On order to gauge the progress of globalization, the Index ranks 62 countries which together account for 96 percent of the world’s gross domestic product (GDP) and 85 percent of the world’s population, using several indicators, including trade, business, politics and information technology. Based upon the data collected, the Global Top 20 are:
- United States
- New Zealand
- United Kingdom
- Czech Republic
High scores for technology helped to lift the Untied States past Ireland, despite weaker connections with the rest of the world in personal and economic terms. The lack of personal connections with the rest of the world is particularly surprising because the Census Bureau, which estimates the U.S. population will exceed 300 million individuals on October 17, 2006, reports that in 2005, 12.5 percent of the population were not born American citizens. In fact, one international migration into the country occurs every 31 seconds. The U.S. also remains home to more than half of the world’s billionaires, according to Forbes magazine. Perhaps it isn’t so surprising that Americans are at the top of the list when it comes to the number of Internet hosts and secure servers per capita. The U.S. has also developed stronger diplomatic and political engagements with international organizations, increased foreign investment within the U.S. and made a greater financial commitment to United Nations peacekeeping efforts.
The other key findings of the Index include:
- Australia entering the top 10 for the first time. Propelled by high commodity prices, combined with strong services, greater foreign investment and strong tourism, Australia rose four spots, to eighth place in this year’s Index.
- One of the year’s biggest falls was experienced by France, which dropped five places and out of the top 20. Although France remains in the top rankings when it comes to political globalization, thanks to active participation in treaties, peacekeeping efforts and international organizations, high tariffs, stubborn agriculture subsides and a continued decline in trade as a percentage of GDP, have significantly impacted the country’s overall level of globalization.
- After falling eight spots last year, Russia reclaimed five of them this year, rising to 47th place. It is also one of the “BRIC” countries, Brazil, Russia, India, and China, which may finally be on the globalizations fast track. Among these countries, India demonstrated overall improvement in most areas, while the growth of China’s trade volume has created the third largest trading nation in the world and raised its globalization ranking three spots, to 51.
- As investment shifted to Asia and Eastern Europe, Ireland, the most globalized nation of 2001 and 2002, dropped from second place to fourth.
- Canada, second only to the U.S. in terms of technological connectivity, retained its sixth place ranking for another year. And speaking of connectivity, it is generally true that the less connected a country is to the world, the larger its shadow economy is. Some globalized nations, such as Denmark and Sweden, which have large informal sectors populated by individuals trying to escape some of the world’s heaviest tax burdens, are the exceptions to this rule.
This year’s Index uses data from 2004. That year saw increased membership in the European Union, the North American Treaty Organization (NATO) and the World Trade Organization, as well as terrorist attacks in Europe and increasing concerns regarding immigration and border security.