The world is now a global village. Hence, globalization is a concept that has affected every aspect of human existence. The exchange of goods and services across nations and individuals, regardless of geographical limitations, is becoming increasingly seamless.
A Brief History of Global Trading Market
If you take a trip down memory lane, you’ll notice that global trading has come a long way. The origin of international or global trading dates back to the 19th century after the French war. The trade relations among nations increased significantly from 1865 to 1913, just before World War I broke out.
When WWI broke out, global trading fell rapidly. There was a massive dip in the export market. As it is with war, arms sales enjoyed enormous proliferation.
After World War I, things began to fall back to normal. It took a while for global trade volumes to rise to the peak reached before 1914.
The most significant rise in global trading came after World War II. In 1947, the General Agreement on Tariffs and Trade (GATT) was signed in Geneva by 23 nations. It marked a new dawn for global trading markets.
However, to better understand the modern tendencies in the global trading market, we need to look at the industrial revolutions that have happened over time. We can then link them to how they affect the global market in recent times.
Global Industrial Revolutions
There is an age-long relationship that exists between industrialization and globalization. The global industrial revolution that started in the late 18th century ushered in an abundance of raw materials. Industrialization led to the creation of new products and markets.
The products and raw materials that came, as a result of industrialization, needed to reach consumers across the world. That’s what led to the expansion of global trading markets.
Products were made in Europe from American raw materials and exported to Asia for consumption. A consequence of this affair between industrialization and globalization was the creation of trade routes. These trade routes connected America to Europe, Europe to Asia, and other continents of the world that needed the products.
We can talk about the early days of global trading markets without the pros and cons of globalization. The good that happened to the world was that manufacturers had more markets to sell their products. On the flip side, it created the opening for Europe to colonize the world.
The Journey from Then to Now
At this point, it’s safe to look deeper into how the industrial revolutions changed the course of global trading markets.
The First Industrial Revolution (1760 to 1830)
This is the period when Britain dominated and monopolized the global market. At the time, they had control of machinery, manufacturing techniques, and skilled laborers. Knowing that they were ahead of the world in industrialization, they kept everything within the confines of the British territory.
The embargo on the exportation of the industrialization that gave Britain a huge advantage didn’t sit well with some British businessmen. These folks began to seek more significant market opportunities outside Britain.
In 1807, two Englishmen took the industrial revolution to Belgium. The revolution further expanded global markets at the time.
Though it took a while for other countries to get on the wagon, it eventually happened after almost over a decade of British Monopoly. European countries like France and Germany came on board the ship to industrialization.
When the United States came into the picture, they gave the Britons a good run for their money’s worth. America became an industrial giant in the late 19th century.
Other countries that joined the industrial revolution at the time were Japan, the defunct Soviet Union, China, and India.
The Second Industrial Revolution (1870 to 1914)
While the first phase of industrialization focused on machinery and skilled labor, the next step introduced the manufacturing of more natural and synthetic products. It was in this era that synthetic materials like plastics began to flood the global market. Global trading expanded as a consequence.
The expansion in marketable products demanded a more straightforward way of doing business. Hence, this era brought computers into the fold. These computers now gave rise to what was called automatic factories.
With the global market expanding, governments began to get more involved. Economic policies came into play to establish checks and balances. Hence, averting an impending global financial and market crisis due to laissez-faire ideas that were at play at the time.
World War I marked the end of the second industrial revolution. Global markets were on shutdown as trade routes were either closed or manned by warring nations.
The Third Industrial Revolution (1990 to Present)
The advent of the internet marked the beginning of the third industrial revolution. The global market has shifted from the exchanges that took place at country borders to a peer to peer market setting.
With the world dealing with a myriad of global issues like natural disasters in, overpopulation, and poverty in some of the most populated cities of the world, there was the need to make the world a global village.
Trade deals can go on from anywhere in the world. People now have access to computers and the internet. It doesn’t matter if you’re a college drop out or a graduate from some of the best universities in the world, you can be a part of the global trading market.
In the first and second industrial revolutions, skilled labor was an exclusive reserve of a few countries that dominated industrialization. Today, remote workers can come from anywhere in the world, thanks to the advent of the internet.
For instance, you can hire labor remotely over the internet. An example is getting content writers from content review websites like Pick The Writer, Writing Judge, and so on. The global market has now become more internet and remote-based.
However, the third industrial revolution has its significant cons. One of which is cybersecurity. With a lot of data shared over the internet, there are concerns about the unauthorized use of personal information for fraudulent activities.
With small businesses increasing, the dependence on the internet of things is increasing, thereby posing further cybersecurity challenges in the global trading market.
Statistics available shows that 43% of cyber attacks are targeted at small businesses. Sadly, over 60% of these small businesses go out of business within six months of the attack.
What’s The Way Forward?
As we gradually move from the third into the fourth industrial revolution, we expect that some of these cybersecurity challenges will reduce. Each industrial era comes with its pros and cons. However, the higher we go, the better we get – and the global trading market isn’t left out.
Already, technological advancements like Artificial Intelligence (AI), are with us. We are getting ready for an industrial revolution that will completely alter the way we live and do business. Industries are shaping up for what is coming with this technological revolution.
One sure thing is that the global economy will improve and life will be better for many people all over the world. Most bottlenecks in living standards and business opportunities will disappear to a large extent.
We envisage an era where technology will make life a lot easier. Trading platforms like crypto will make massive inroads into the global market systems. It’s a progressive world, and all we can do is get ready for the imminent.
Anna is a specialist in different types of writing. She graduated from the Interpreters Department, but creative writing became her favorite type of work. Now she improves her skills while working as a freelance writer for Pick The Writer, Writing Judge to assist a lot of students all over the world and has free time for another work, as well. Always she does her best in the posts and articles.