Among the topics covered in this year’s World Economic Forum in Davos was the debate over the trajectory of globalization in 2023. In one camp, “de-globalization” infers an entrenched decline, whereas “re-globalization” reflects the periodic need to reorganize supply chains in accordance with geopolitical realities.

In either case, the conditions of a potential global recession, economic nationalism, and endemic supply chain shocks collectively support a return to regionalization in determining industrial, trade, and investment objectives. As the latest iteration of this trend, the revival of a potential monetary union between Argentina and Brazil is driven by the desire to reduce external shocks from dollar-denominated trade, enhance the bargaining power and relevance of Mercosur, and align industrial and trade policy to regional economic objectives.