Unit 10 developing global business

Learning goals After studying this unit you will be able to: give your opinion on the roots of globalisation explain the concept of globalisation discuss different aspects of globalisation assess advantages and disadvantages of globalisation

READING I

History of globalisation

Before you read

Vocabulary task

1. Word building: complete the following table with the appropriate derivatives.

Verb	Noun	Adjective
–	history
		global
articulate
	commerce
create
	engagement
		significant
perceive
	decision
		sustainable

1. Read the following geographical and proper names, mind the pronunciation and translate them into Russian. Look up the following geographical and proper names in your dictionary to check their pronunciation and translation. Read them out loud.

Alexandria, Athens, Antioch, Eurasia, Iberian Peninsular, Portugal, Castile, Cape of Good Hope, Brazil, Sub-Saharan Africa, Pacific Islands, Pathian Empire, Christopher Columbus, Han Dynasty, Silk Road, Islamic, Jewish, Muslim, Middle East.

Key terms

1. Match up the words on the left with the definitions on the right. Suggest the Russian equivalents.

1) globalisation 2) commerce 3) consumer 4) integration 5) colonisation 6) colony 7) investment 8) poverty

a) a person who uses goods b) a region politically controlled by a distant country c) establishing colonies d) putting capital in a business enterprise e) a condition in which where people’s basic needs are not being met the state of being extremely poor f) an exchange and distribution of goods g) going together with other social groups or different races h) a process of transformation of local or regional phenomena into global ones

Think ahead:

1. Is globalisation a modern phenomenon? Explain your point of view.

2. Do you agree that “a man’s feet must be planted in his country, but his eyes should survey the world” (George Santayana, philosopher and writer). ?

Text 10.1 Skim the text and list different periods of globalisation.

Long History Phenomenon

The historical origins of globalisation are the subject of on-going debates. Though several scholars situate the origins of globalisation in the modern era, others regard it as a phenomenon with a long history. Thomas L. Friedman, a famous American journalist, divides the history of globalisation into three periods: Globalisation 1 (1492-1800), Globalisation 2 (1800-2000) and Globalisation 3 (2000-present). He states that Globalisation 1 involved the globalisation of countries, Globalisation 2 involved the globalisation of companies and Globalisation 3 involves the globalisation of individuals.

An early form of the globalised economy and culture is known as archaic globalisation, when commercialised urban centres were focused around the axis of Greek culture over a wide range that stretched from India to Spain, with such cities as Alexandria, Athens, and Antioch at its centres. Trade was widespread during that period, and it is the first time that the idea of a cosmopolitan culture emerged. Others have perceived an early form of globalisation in the trade links between the Roman Empire, the Parthian Empire, and the Han Dynasty. The increasing articulation of commercial links between these powers inspired the development of the Silk Road, which started in western China, reached the boundaries of the Parthian Empire, and continued onwards towards Rome.

The Islamic Golden Age was also an important early stage of globalisation, when Jewish and Muslim traders and explorers established a sustained economy across the Old World resulting in a globalisation of crops trade, knowledge and technology. Globally, significant crops such as sugar and cotton became widely cultivated across the Muslim world in this period.

The advent of the Mongol Empire, though destabilising the commercial centers of the Middle East and China, greatly facilitated travel along the Silk Road. This permitted travellers and missionaries such as Marco Polo to journey successfully from one end of Eurasia to the other. This part of the thirteenth century had several other notable globalising effects. It witnessed the creation of the first international postal service. Up to the sixteenth century, however, even the largest systems of international exchange were limited to the Old World.

The next phase was characterised by the rise of maritime European empires, in the 16th and 17th centuries, first the Portuguese and Spanish Empires, and later the Dutch and British Empires. In the 17th century, globalisation also became a private business phenomenon when chartered companies like British East India Company (founded in 1600), often described as the first multinational corporation, as well as the Dutch East India Company (founded in 1602) were established.

The Age of Discovery brought a broad change in globalisation, being the first period in which Eurasia and Africa engaged in substantial cultural, material and biologic exchange with the New World. It began in the late 15th century, when the two Kingdoms of the Iberian Peninsula – Portugal and Castile – sent the first exploratory voyages around the Cape of Good Hope and to the Americas, ‘discovered’ in 1492 by Christopher Columbus. Shortly before the turn of the 16th century, Portuguese started establishing trading posts (factories) throughout Africa, Asia and Brazil, to deal with the trade of local products like gold, spices and timber, introducing an international business centre under a royal monopoly, the House of India.

Global integration continued with the European colonisation of the Americas initiating the enormous widespread exchange of plants, animals, foods, human populations (including slaves), communicable diseases, and culture between the Eastern and Western hemispheres. It was one of the most significant global events concerning ecology, agriculture and culture in history. New crops that had come from the Americas in the 16th century significantly contributed to the world’s population growth.

The 19th century witnessed the advert of globalisation approaching its modern form. Globalisation in this period was decisively shaped by the nineteenth-century imperialism. After the completion of the British conquest of India, vast populations of these regions readily became consumers of European exports. It was in this period that areas of sub-Saharan Africa and the Pacific islands were incorporated into the world system. Meanwhile, the conquest of new parts of the globe, notably sub-Saharan Africa, by Europeans yielded valuable natural resources such as rubber, diamonds and coal and helped fuel trade and investment between the European imperial powers, their colonies, and the USA.

The first phase of ‘modern globalisation’ began to break down at the beginning of the 20th century, with World War I. Globalisation, since World War II, is partly the result of planning by politicians to break down borders hampering trade. Their work led to the Bretton Woods conference, an agreement by the world’s leading politicians to lay down the framework for international commerce and finance, and the founding of several international institutions intended to oversee the processes of globalisation. These institutions include the World Bank and the International Monetary Fund. Globalisation was also driven by the global expansion of multinational corporations based in the United States and Europe, and worldwide exchange of new developments in science, technology and products. Worldwide export of western culture went through the new mass media: films, radio and television, and recorded music. Development and growth of international transport and telecommunication played a decisive role in modern globalisation.

In the 21st century, much of the industrialised world entered into a deep recession. Some analysts say the world is going through a period of deglobalisation after years of increasing economic integration.

Concept check

1. Match the following half-sentences.

The idea of a cosmopolitan culture emerged The 15th century is considered to be the period The European colonisation of the Americans With the involvement of some areas into the world system, The establishment of some international institutions 6) Nobody will deny

that the international transport and telecommunication are important for modern globalisation. on the basis of Greek culture. marked the beginning of a new stage of globalization. played its role in the process of globalisation. when the cooperation with the New World began. the number of people using European exports increased.

2. Read each statement and decide whether it is true of false. Explain your viewpoint.

1. A historical origin of globalization is subject to debate.

2. The Islamic world did not influence the process of globalisation.

3. The Mongol Empire made a negative impact on the development of globalisation.

4. European colonisation of the Americas provoked the global integration.

5. The growth of the population in the world resulted from American agricultural products.

6. In the 19^th century, the new social system gave a new shape to globalisation.

7. According to some analysts, a deep recession is a reason of deglobalisation.

3. Ask questions that may produce the following answers.

1) Jewish and Muslim traders and explorers established a sustained economy across the Old World.

2) The advent of the Mongol Empire made travel along the Silk Road much easier.