Economic Globalisation
BasicThe phone in your hand gathered parts from many countries: how trade, firms and labour link nations — with both opportunities and challenges.
- Globalisation: economies interdependent as goods, capital, technology and talent cross borders.
- Organisations: WTO for trade rules, World Bank for development loans; China joined in December 2001.
- Three links of the chain: multinationals, division of labour, labour mobility.
文體小知識：全球議題課——用一件手機的旅程拆解經濟全球化：貿易規則、跨國企業與新經濟如何令各國互相依存。
§Text Passage
1The phone in your pocket may be designed in the United States, its camera made in Japan, assembled on the Chinese Mainland, with parts from dozens of countries — that is economic globalisation: national economies bound together as goods, capital, technology and talent flow across borders, turning the world into one great workshop and market.
2Behind globalisation stands an institutional framework. The World Trade Organization sets international trade rules and promotes open markets; the World Bank lends to developing countries to improve infrastructure and livelihoods; through such organisations nations coordinate and cooperate. China joined the WTO in December 2001, entered the international trading system, and went on to expand its foreign trade rapidly, becoming a widely recognised manufacturing power. Multinational corporations are another driving force: they build factories across countries and divide production globally, and labour markets move with them, as workers everywhere join the international division of labour according to their strengths.
3In recent years a 'new economy' has emerged: growth led by technology rather than manufacturing, with knowledge, data and innovation as engines. For individuals, consumption is richer — online shopping brings goods from around the world to your door — while employment is more demanding: repetitive tasks are easily automated, and technological skills matter more and more.
4For Hong Kong and the nation, globalisation brings both opportunities and challenges: bigger markets and easier access to resources on one side; fiercer competition and shocks that spread quickly across borders on the other. Learning to weigh both sides is a core thinking skill of this course.
1Summary 重點摘要
The phone in your hand gathered parts from many countries: how trade, firms and labour link nations — with both opportunities and challenges.
2Vocabulary cards Vocabulary
The process by which economies become interdependent through trade, investment and technology.
Economies rely on one another, so shocks in one place affect others.
The body setting trade rules, opening markets and settling disputes.
The institution lending to and assisting developing countries.
A large firm operating production or sales across several countries.
Countries specialising in different stages of the production chain.
Workers moving across borders to join the global division of labour.
Financial markets opening and linking, letting capital flow freely.
An economy led by technology and knowledge rather than manufacturing.
Globalisation brings both benefits and risks — cover both in answers.
3Step by step Steps
- Step 1: What economic globalisation meansEconomic globalisation is the process by which the economic activities of the world become interconnected and interdependent: goods, capital, technology, information and talent cross borders, so a change in any major economy affects many others. For example, the coffee you buy in the morning may use beans from South America and sugar from Southeast Asia, brewed and sold in Hong Kong — one cup links producers across several continents. A simple test of globalisation is counting how many countries contributed the parts and processes behind one everyday product.
- Step 2: Cooperation through international economic organisationsGlobalisation needs rules and coordination, and international economic organisations are the guardians of those rules. The World Trade Organization sets multilateral trade rules, promotes open markets among members and settles trade disputes between them; the World Bank lends to developing countries and offers technical assistance for infrastructure and livelihoods. China formally joined the WTO in December 2001, entered the international trading system, and saw its foreign trade expand rapidly, becoming a manufacturing power recognised worldwide — a history that appears often in textbooks and examinations.
- Step 3: The development and effects of multinational corporationsA multinational corporation runs production lines, offices or sales networks across several countries. To cut costs and reach markets, it spreads research, parts production, assembly and sales around the world, creating global supply chains. For example, a single smartphone draws parts from many countries, is assembled in one place and sold worldwide. The effects cut both ways: multinationals create jobs, transfer technology and make goods cheaper, yet developing countries may remain locked in low-value assembly work with weaker bargaining power.
- Step 4: Labour mobility and the international division of labourUnder globalisation, both workers and tasks move across borders, producing global labour mobility and an international division of labour: each country specialises in a stage of the production chain according to its own conditions — some lead in research and design, some in precision manufacturing, some in assembly. Hong Kong offers everyday examples: firms hire overseas professionals and imported workers, while local graduates also take up jobs on the Mainland or abroad. Specialisation raises overall efficiency, but it also links economies tightly, so a halt in one place affects the whole global chain.
- Step 5: Opening and integration of global financial marketsAlongside goods and talent, capital also races around the globe. When financial markets open to one another and connect, we call it financial market integration: companies list overseas to raise funds, investors buy foreign assets, and capital is allocated worldwide according to return and risk. Hong Kong, as an international financial centre, is precisely the bridge for capital between China and the world. Integration improves financing efficiency but links risks too — a crisis in one market can spread panic to others within hours, as the 2008 global financial crisis showed.
- Step 6: The new economy and its effects on individualsThe world economy has entered the 'new economy' stage: growth now comes more from technology, knowledge and data than from traditional manufacturing, with artificial intelligence, e-commerce and digital services rising fast. For individuals, consumption has changed — online shopping and mobile payments bring goods from around the world to our doorstep — while the job market is being reshuffled: repetitive tasks are easily automated, and demand keeps rising for technological, creative and cross-disciplinary skills. This is a trend every student must weigh when planning future pathways.
- Step 7: Opportunities and challenges — the answering habitWhen analysing globalisation, remember that opportunities and challenges coexist; never write only benefits or only harms. Opportunities: larger markets, easier access to resources and technology, richer consumer choices. Challenges: fiercer international competition, economic shocks spreading across borders, and pressure on low-skill jobs. A good answer defines the concept first, then argues with examples under 'opportunities' and 'challenges' in turn, and finally connects to the situation of Hong Kong or the nation — for instance, how Hong Kong serves as a connector in the international trading system. That structure is complete.
5Worked example Example
Read the data: a smartphone brand is designed in the United States, with chips from South Korea, screens from Japan, assembly on the Mainland, and sales to many global markets. Based on the data, identify and explain two features of economic globalisation.
- Step 1: Read the command word — 'based on the data' means every point must come from the sources, not from memorised definitions alone.
- Step 2: Feature one — international division of labour: design, parts and assembly sit in different countries, showing a global production chain.
- Step 3: Feature two — multinational operation: the brand arranges research and production across countries and sells worldwide.
- Step 4: Answer in the format 'evidence + concept': quote the fact from the data, then name it with a concept such as international division of labour.
- Answer: Sample answer: Feature one: international division of labour. The data show the phone is designed in the US, with chips from South Korea, screens from Japan and assembly on the Mainland — the production chain spans many countries, each specialising in one stage, which is the international division of labour under globalisation. Feature two: multinationals organise global production. The brand arranges research and production across countries and sells worldwide, showing how multinationals deploy resources across borders and draw every economy into one production and sales system, deepening interdependence.
6Common mistakes Mistakes
7Quick check Quick check
Q1What is the core phenomenon of economic globalisation?
Q2The WTO's main functions?
Q3When did China join the WTO?
Q4What is the new economy?
Q5Give one effect of multinational corporations.
8Recap Recap
- Globalisation: economies interdependent as goods, capital, technology and talent cross borders.
- Organisations: WTO for trade rules, World Bank for development loans; China joined in December 2001.
- Three links of the chain: multinationals, division of labour, labour mobility.
- New economy: manufacturing gives way to technology — easier consumption, higher-skill jobs.
- Answering habit: opportunities and challenges both, definition plus examples plus the local link.