Until 2020, eCommerce integration into retail was incremental, continuously laying the groundwork for a new foundation in how people buy and sell almost anything.  Last year, it became clear that it was not only an equal partner in connecting with consumers, but a critical necessity – especially for those whose Main Street establishments were shuttered and on the verge of permanent shutdown.  As we collectively turn the page on a transformative global year, here is a quick snapshot of what 2021 may have in store for California businesses and global trade. 

New U.S. Leadership, New Directions

The World Bank expects the global economy to expand by 4% in 2021, and has emphasized that containing the spread and improving treatment of COVID-19 is vital for economic recovery.  They also underscored that private sector support via a sustainable re-investment cycle is necessary to help offset government debt incurred during the past year.  The directive for government leadership in the U.S. and around the world is clear: act quickly and decisively to deploy vaccinations and sustainable economic measures to stimulate the economy.  

Both of these directives are at the top of the new U.S. administration’s agenda and well under way.  In addition to crafting a more productive trade relationship with China, whose economy grew by approximately 2% (in part due to a long-established eCommerce ecosystem) in 2020, we can expect this administration to have a more multilateral mindset in how they forge trade deals, to review government subsidies, and eventually ease many of the restrictive and protectionist tariffs applied by the Trump administration.  A potential complication is Brexit and how the U.S. will position itself between the U.K. and the rest of the E.U.  

Still, underperformance is expected into the next decade unless equitable and sustainable policies are put in place, and with a pivot from income support to growth enhancement.

The New Investment Landscape

Supporting the World Bank’s assessment, BlackRock investments 2021 Global Outlook explains that “a new investment order” has begun where a more equitable and sustainable approach, both in policy and practice, is key to a global economic restart. Once again, getting COVID-19 infections under control is priority number one, and alongside that, BlackRock sees a quick and accelerated bounce back for most economies around the world if governments implement supportive policies.  They see three key themes in 2021: the new nominal, globalization rewired and turbocharged transformations.  

It’s Still About the Supply Chain

The logistics industry is expecting a more methodical and reliable approach to global trade and movement of goods with the new administration, but caution that it will still take time to move through existing inventories and backlogs.  According to Logistics Management, the industry is expecting to see more disruption in 2021 as “the world moves from physical to digital, wasteful to sustainable, delayed to instantaneous, and from manual to automated.” In the meantime, businesses should continue to monitor trade deals, tariffs, taxes and origin of goods, and other trade compliance metrics.  Very likely all of these processes will see accelerated digitization to make the process quicker and more efficient, especially in the wake of a massive global pause. 

What Businesses Need to Know: Bend, Don’t Break

As the fundamental economic foundations continue their shift, California businesses should veer towards flexibility in their operations, sales channels and cycles.  Reassessing markets and opportunities may allow for greater growth in the long run and providing customers with more digital and online solutions will be a necessity.  

This is a great time to learn more about the California International Trade Center’s online tools and resources.  If you’re looking for more hands-on assistance to optimize your eCommerce activities, check out CITC’s Global eCommerce Accelerator.  

Kuntal Warwick
Kuntal Warwick

Provides global branding and market entry strategy and planning to businesses expanding internationally. Provides private-sector partnership development and content support for workshops and programs dedicated to SMEs engaged in global eCommerce.