We are still living in the aftermath of the crises. Before the financial crisis the interconnections between countries were growing. Since 2008 both international trade and capital flows have been reduced.
One reason for the retreat is the financial crises. Another reason is increased costs of shipping. It currently costs about USD 5000 to ship a container from Shanghai to United Kingdom. This is more than double the amount charged when oil traded at only 20 USD a barrel. The price of oil alone has had a severe impact on shipping costs and in some cases caused companies to go into reverse globalisation and return to local production. A third reason is the high growth in the emerging economies like China is raising costs for both energy and labour, and making offshore production there less interesting.
Financial Times and McKinsey have studied global capital flows and compiled the data in the graph below, which shows the development over the past twelve years.
In the video below from Financial Times, Ralph Atkins, capital markets editor, explains to John Authers the results of the FT study, which shows that capital retreated behind national borders during the crisis.