For as long as humanity existed, trade has been a vital cornerstone, irrespective of the parts of the world we traversed. From simple bartering to modern-day stock exchanges, trade has been one of the key factors in the improvement of one’s lifestyle. Whether it be spices or rare metals, knowledge or culture, civilizations from one end of the globe to the other have managed to make and maintain contact using land routes such as the Silk and Amber Roads or the sea routes, and from the past century via air too. Perhaps, in the near future, we will be able to do the same on our neighbouring planets.
Jobs, cultures, inventions and science have all improved in quality and quantity all across the world. We are also living in a time of unprecedented peace. Despite recent events, humanity lies in its most peaceful and safe era yet. Where there is peace and safety, there is trade, whether it be material or otherwise. We call all this globalization — the integration of the world. However, even the strongest of the webs have some weak links and aren’t as permanent as they might look.
Chronicle
The history of the earliest trades is not exactly known. However, we can safely assume that it could have been among the members of one’s tribe, or even among other human tribes, regardless of species. As people settled into more permanent agrarian civilizations, society grew complex. Administration, taxes, hierarchies, religions, and other aspects of society grew to accommodate the needs of the people. Coinage was introduced to overcome problems within the more simple bartering system. With technological improvements, new materials and ship designs allowed for better tools and longer voyages. This would significantly increase production and allow people to grow out of their agrarian roots. Those who would choose to set out and explore, would encounter the other civilizations and start the chain of commerce. Thus, it was a self-fulfilling cycle.
As republics, empires, and kingdoms grew, so did their integration with the areas they would meet. Traditions would be exchanged, modified, or even integrated among two very different cultures. Science and technology would spread, and their records would be kept safe in libraries and be used by future generations. They would also serve as an analogue to backups, in case the original society of those who made the records were to collapse.
Migration is rooted in human nature, for across the world, people have travelled on the basic technologies and still managed to traverse large areas, like the Polynesians and their colonization of the Pacific. The modern age of globalization can be said to begin with the advent of European colonization. Even though many societies before them did have colonies and travelled across the world, none would be as impactful, both in a positive and negative sense, as the Europeans. The British, French, Portuguese, Dutch, and Spanish armadas would create immense wealth from the trade of gold and silver, spices, fur, and slaves as they created their empires across the “New World”, Asia, and Africa.
The spread, mixing, and integration of cultures would create multiple new cultural identities. Thanks to industrialization, the means of mass production would begin the era of unprecedented growth. Now, agricultural production would exponentially rise as fertilizers would become commonplace, canals and dams grow larger, and newly introduced crops from the New World would be grown across the world. New metalworking techniques would enable the use of larger iron ships, which would enable larger amounts of trade. Workers from other countries would migrate to more technologically advanced ones to find labour and send money back, creating even more economic growth.
With the onset of the 21st century and the spread of the internet, the common man has access to the entire world, albeit with conditions. For the first time, instantaneous communication was more rapid, open, and accessible. Online shopping and applications allowing individuals to trade stocks, futures, and more directly, with their fingers would prove to be a formidable force irrespective of their country. One could say that the internet and globalization share the same spirit.
However, external factors can disrupt this. For example, the Bronze Age collapse, in which the empires and kingdoms of the Bronze Age across Europe and Asia collapsed and brought in a new dark age for centuries. This was caused by the simultaneous events of drought, attacks by a mysterious group of people collectively known as the Sea People, volcanic eruptions, and disruptions caused by new technology, and possibly more. The Black Death, the bubonic plague that would kill about a third of Europe, is said to have originated in Asia and spread via rats on ships. As such, diseases, instability, or weather catastrophes which could affect trade, often lead to economic recessions, and unacceptance or distrust of outsiders.
Atlas
The foundations of modern-day globalization have been built upon technological improvements and standardizations. The twenty-foot shipping container would be one of the biggest and most underrated contributions to economic growth in the late 20th century. Modern-day shipping is the primary way of transporting goods around the world. Nothing matches the overall efficiency achieved by ships, even if they use the crudest oils and take days to travel compared to the hours achieved by aeroplanes. They also heavily rely upon the Suez and Panama canals, both of which cut shipping costs and time by weeks. However, they were built over a century ago and are always in danger of bottlenecking the routes, as can be seen when the Evergreen got stuck in the Suez Canal. Even with the widening of the canals, there is only so much that can be done till it becomes economically unfeasible, or worse economically dangerous.
Important metals such as lithium are concentrated in three main areas — the Lithium Triangle of South America, Australia, and China [1]. Other identified reserves often lack the facilities and economic backing to extract and utilize the natural occurrence of such metals. Lithium is heavily in demand as more electronic devices utilize lithium-ion batteries, especially with the rise of electric vehicles which require an immense number of batteries. The production of lithium that can be utilized is slow and expensive, and in case of instability in any of the above regions, could be devastating. Whether or not the industry can replace the highly desired lithium with other materials is a race of its own. Hopefully, they can do it before there could be a lithium supply problem [2].
The Democratic Republic of Congo is perhaps the most important region in the world when it comes to metals. Large deposits of cobalt, nickel, lithium, and other metals which are important to industries as catalysts for chemical production, components of electronics and other industries are often sourced from the Congo. However, it is highly controversial, with exploitive child labour, inhumane conditions, and questionable environmental safety combined with instability often plaguing the country [3] [4] [5].
Oil is often located in countries where a form of autocracy is the government. This can be dangerous as this puts, what is a vital lifeline for countries, under the mercy of autocratic nations, which are also possible places for political instability. Numerous oil-related conflicts have occurred after the Second World War and will continue to do so as long as the oil is used. The most recent of which, was the price war between Saudi Arabia and Russia in which Saudi Arabia and the other OPEC nations dropped prices of oil against Russia triggered by the break-up dialogues [6]. Bear in mind that oil is not only used in fuel, but also in several other industries.
Chinese manufacturing has formed the backbone of the 21st century in a way no other single country can match in the coming decades. From the simplest of toys to the most technologically advanced smartphones, China has successfully grown from an agrarian to an industrial and technological superpower. The Chinese dream of the Belt and Road Initiative is one of massive optimism and would serve the Chinese Communist Party’s dream of restoring China to its previous glory [7].
The American dollar has served the role of the standard for all countries, for that is what is now compared to primarily when comparing currencies. Gold, silver, and oil are no longer the standards, but do remain on the sidelines. However, even the dollar is not immune to the problems faced by currencies as, it too, is affected by problems such as inflation which can affect foreign reserves by devaluing them [8].
Shatterpoint
It must have been a cold month the day it managed to cross the border. From there, it just kept spreading. With clear skies in Delhi and Beijing, and silent highways and airways, the world was at a near standstill. From one continent to another, it would also eventually reach the most closed-off nations on earth, such as the infamous hermit kingdom of North Korea. The coronavirus, known as SARS-CoV-2, will not be known as the deadliest virus in history. It will, instead, be known for how it managed to break down the world of humans for 2 years. It will be almost impossible to properly understand its effects, for numbers can only tell so much, and we, as humans, can only feel so much till we are desensitized.
As countries implemented lockdowns, travel reduced and fuel supplies dropped to match demands. Semiconductors, something which people didn’t even think about before the pandemic, proceeded to break down the delicate global supply lines. Factories in countries with the strictest lockdowns often needed to work with minimum labour to ensure that at least the bare minimum demands, often integral personal protective equipment (PPE) kits, were met. While the rich could stay safe, and the middle class managed to save some money and spend more time with their families, the lower classes were often faced with unemployment, homelessness, bankruptcy, and more. Stimulus packages managed to save many, but not all. Once holiday seasons rolled around, the bare-bones supply chains were stretched too much to cover the demands. The drop in tourism also meant several small nations had a sudden increase in unemployment. A drop in demand for supplies also contributed to less manufacturing of said supplies.
However, all was not doom. For many, it was a chance to spend more time at home with family, or to learn new skills with the saved money they had or received. For what it seemed, the future might be bright. [9]
Horizon
As the pandemic seemed to die down and countries reopened, the lives of people started getting back to normal and all seemed well. Even as many were retiring or switching jobs, unemployment in several countries kept going down. Many people utilized their newfound skills and knowledge to get better jobs, or simply had more time to invest and get returns on a rising stock market.
However, tensions were rising. Prices of everyday items from food to fuel were rising in Sri Lanka, alongside what was appearing to be an imminent invasion of Ukraine by Russia [10] [11] [12]. Meanwhile, cases of coronavirus drastically increased in Shanghai, which led to one of the harshest lockdowns in the world, another blow to manufacturing and trade [13]. While the coronavirus has died down in China, Sri Lanka is facing economic and political instability. The semiconductor crisis has gotten better, but its brittleness has been shown. Wheat and maize, of which Russia and Ukraine are responsible for nearly a quarter and fifth, respectively, have risen. This is worse in countries such as Somalia as it faces one of its worst droughts and instabilities and requires imports to sustain itself [14].
The sudden inflation of the United States’ dollar also puts the world in a precarious place as the world relies upon a single country’s currency as the standard [15]. Around the world, prices of common goods increase while Europe also faces an energy crisis as Russia, being its main provider of natural gas, faces the economic wrath of the European Union. The war is unlikely to end soon going by the rhetoric used by Putin [16]. OPEC has decided to limit supply and keep supplies low to maximise profit, as the world is going green. Unfortunately, the everyday man in every country still relies upon petrol and diesel to commute and travel, whether it be for trade or leisure. What once looked like a chance of regrowth and rebirth, now faces new challenges, a possible recession not seen for decades.
Ashes
The world has made several strides to go green, yet it hasn’t done this process fast enough to avert our climate crisis. We cannot build enough solar and wind farms in time to completely replace coal and oil power plants. No more empty promises can stop these effects. With rising temperatures and sea levels, many parts of the world face severe droughts and water shortages, affecting their agricultural output [17].
Thanks to Russia, the prices of wheat and maize have increased to the point that it has become too expensive, even in countries where agriculture is the primary industry. Major cities located near coastal areas face catastrophic storms, which reduce economic growth and often divert funds to crisis management. At the beginning of 2020, massive wildfires ravaged California and Australia, turning severe due to the climate crisis and negative human intervention. The cost of damages amounted to billions.
To maximize economic profits, shipping companies utilize low-quality fuel which may be fine for their purposeful slow voyages, but environmentally, it is very dangerous [18]. Developing countries are resource-strapped, and need to use coal and oil to power their industries, as nuclear, hydroelectric, and other relatively green resources often require specialised experts and billions of dollars. Even in the face of some of the worst disasters humanity will experience, some resources are simply too expensive at normal market values.
Abyss
Potential resource wars for water are a possibility many countries face. Downstream river countries are often subjected to the selfishness of upstream river countries, who need to rightfully serve their own needs first [19]. While the shortage of lithium will not occur in the next few years, it will be hard to predict beyond the short-term future unless a major technological innovation takes place. The same applies to other rare metals and minerals. With global warming, however, there are possibilities of new shipping routes from the Atlantic to the Pacific via the Arctic circle which would cut costs dramatically, possibly even more than the Panama Canal does for the same [20]. With the space industry whose aspirations touch the stars, off-world mining could be the solution to the metal shortages.
Another aspect to consider is the migration of people. Migrant crises have affected and changed Europe drastically. Increasing anti-immigration sentiment, while the war in Ukraine has shown some of the unfortunate racial discrimination still exists. While the presidency was won by Biden in America, support for Trump and his anti-immigrant stance and “America First” policies still held high. Immigration is a crucial piece of globalization as it brings cheap labour and better cultural integration. Affecting it can be dangerous, but at the same time understandable, as the people of one’s own country rightfully require a higher preference within their own country. Sanctions, too, might help bend the will of a dictator, but ultimately affects the common man the most.
Pathways
This article may make you feel pessimistic and en-still a sense of doom-ism, but that is not the idea here nor is it healthy to think so. It is simply a reporting of a few cases and potentials faced in the coming decades. There is always a time to fix it, which is now the present. Globalization is good and is necessary for humanity as a whole to grow beyond the confines of what we deem possible. Globalization requires security nets that can avert and withstand the crises it brings along with it. Humans need to be mindful of the environment, and go beyond surface-level changes and empty promises. Effective governance, liberalization, and diversification of the economy by breaking up monopolies or duopolies of brands or supply lines are crucial for this. Is it harder for some countries? Yes. But it has been done before and can be done again. Japan successfully industrialised and recovered after the Second World War. People need a change of mindset to successfully change society, and this stands true irrespective of which government or style of governance is in charge. After all, governance is for the people and by the people.
Article by: Amogh S Amblihalli
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