inflation in consumer goods will persist as a new normal as the global economy undergoes structural changes asian business leaders warn while rising interest rates might eventually temper asset prices deglobalization and decarbonization could continue to drive up costs for everyday goods said v shankar chief executive of emerging markets investment manager gateway partners inflation is here to stay come hell or high water irrespective of what the central banks do because there are some structural intractable problems that have led to higher prices shankar said monday at the forbes global ceo conference in singapore despite helicopter money and zero interest rates the reason why the price of goods stayed down for so long is because of a vast efficient manufacturing agent called china and the integration of global supply chains that integration paved the way for cheaper goods but now catalyzed by the pandemic there are new threats to interwoven global supply chains as countries look to bring back manufacturing to their own countries or to countries they are friendly with shankar said in july us treasury secretary janet yellen touted the need to boost supply chain resilience through friendshoring doing business with countries that share values with washington this collapses globalization and increases prices as manufacturing will no longer be based on numbers and cost considerations shankar added decarbonization efforts will also contribute to higher prices shankar said as there is not enough supply of components for climatefriendly goods to meet demand for instance the global production and consumption of graphite for electric vehicle batteries was 1 million tonnes last year but in 10 years that could rise to 5 million tonnes there is no indication where that extra production will come from shankar says if you look at the fossil fuel industry they are investing at a pace as if we are transitioning to a netzero economy by 2035 whereas the renewable industry is investing at a pace of roughly a third of what is required for netzero by 2050 he said there is an inevitable train wreck and the politics and societal pressures are colliding with economics so inflation is here to stay ho kwon ping executive chairman of singapores multinational hospitality group banyan tree holdings agreed saying higher interest rates are not the new normal rather zero or low interest rates were abnormal i think a real abnormal situation was the period we went through where central banks and others perhaps now in retrospect reacted too strongly and we had too long a period of zero or even negative interest rates ho said the world is going in my view back to probably a longterm situation of low interest rates and hopefully low inflation but zero inflation zero interest rates thats the abnormality and not the future that were looking at whether it is deglobalization or decarbonization underscoring these concerns is the growing rivalry between the us and china the potential splintering of global trade and business into two blocs and having to take sides ho said many business leaders in asiapacific and other parts of the world have had to start scenario planning to mitigate potential sanctions on china even china itself is preparing to be selfsufficient in key areas such as securing enough energy food and critical goods supplies ho adds what i think is really strange is this very aggressive decoupling between china and the rest of the world from each other ho said