CATEGORY: Global Perspective
Recent decades have seen a downward convergence in corporate tax regimes as advanced, emerging and developing economies moved to grab a bigger slice
of the global investment pie. Headline corporate tax rates have fallen by 20 percentage points since the early 1980s. Alongside lower average rates, special
tax incentives aimed at capturing investment have emerged, further reducing the effective rates paid by transnational corporations.
Decades of growth in trade and foreign investment have seen the economies around the world become more interconnected and interdependent than ever before. The production of goods and, increasingly, the provision of services have become fractured across borders as corporations create and integrate into regional and global value chains. These trends have been reinforced by the steady liberalisation of international trade and investment regimes, at the bilateral, plurilateral and multilateral levels. National economic specialisation in areas of comparative advantage, and regional economic and political integration, have proceeded in a single direction, broadly speaking, since the 1980s. On aggregate, advanced economies have benefitted from and have championed these developments, while emerging markets have become the main drivers of growth around the world.
In 2008, for the first time in history, more than half of humanity was living in urban areas. Perhaps the most remarkable observation about this trend is the speed at which it has happened: as recently as 1900 urban areas accounted for 13% of the global population. Towns and cities are seen as the crucibles of opportunity for many rural dwellers.