Globalization in the 1990s was tremendously welcomed in the entire world. It is worth noting that various trade theories were used to elaborate on the benefits of market liberalization and free trade. However, by the end of 20th century, many voices of dissatisfaction began to rise from North America to Asia. This was a clear indication of the changing trends in the global economy, and how globalization was not influencing everyone positively. The current trends in globalization has been profound and brought about by sweeping technological changes, advances of globalization, as well as the emergence of powerful and new competitors in the global economy. The new competitors include India, China, and many countries in the Asia-Pacific. The implications of the current trends in globalization are both complex and varied.
The global economy and the current trends in globalization entails the interdependence of various world economies due to ever growing cross-border trade of services and commodities, spread of technologies, and flow of international capital. The current trends in globalization are a reflection of mutual integration and continuing expansion of market frontiers, which is an irreversible trend (Current Economic Trends, 2013). The current trends in globalization are profoundly based on the tremendous development of technologies and science, which has led to an environment whereby market economic and business systems are spread easily in the globe (Shangquan, 2000). The current trend in globalization has presented more opportunities in terms of efficient resources allocation leading to high level of per capita income. The essence of production has been made fast due to technological advancement. In general perspective, there are major trends in globalization, which consist of scientific and rapid technology, economic interdependence, global power structure, demographic shift, as well as governance. The current trends in globalization are interdependent and it is difficult for it to be separated.
The issue of free trade and protectionism are one of the major issues in the global economy. One of the main questions in the current global economy is whether the global economy will return to the mercantilist stage or the benefits of market liberalization and free trade will always prevail. Based on the current trends in globalization it is evident that the benefits of market liberalization and free trade will prevail (Shangquan, 2000). The advancement of science and technology has actually increased the impacts of free trade. In the contemporary economies, information is one of the main components, and because of advanced technology it is easier today to get information and interact of economic issues. It is worth noting that the global economy can go back to mercantilist stage and protectionism due to global economic disasters since it helps in alleviating the economic pressure caused by free trade (Current Economic Trends, 2013). Scholars argue that in the current trends in globalization there are mechanisms that are used to mitigate the shocks and pressure of free trade.
The benefits of free trade and market liberalization will prevail due to the free flow of communication. The advancement of technology has weakened the issue of protectionism. People in the world can easily communicate through modern technologies and share ideas and skills (World Trade Report, 2008). Free trade together with advance technology has lead to increased production since countries can specialize in what they can produce most and trade with other countries. The free trade and market liberalization has led to economic growth in the world (Shangquan, 2000). In fact, it is evident that countries that are part of free trade have had increased real income, rising living standards, as well as higher rates. The current trends in globalization have made the world more competitive leading to increased production, market efficiency, and competitive industries.
Rapid integration continues to strengthen the issue of free trade since it has introduced new techniques of production driven by technology. The advancement of technology and the current globalization trend pushes the world economy into the free market system (Current Economic Trends, 2013). The free market benefits will prevail due to existing support of technology. Some of the critical reasons include the deepening and widening of international flow of capital, expansion in trade, free flow of information, globalization of production, increased integration, emerging global markets, and the shift in governance. Based on the current trends it is evident that the benefits of free trade and market liberalization will prevail.
Current Economic Trends. (2013). Slovenian Economic Mirror, 19(4), 5-24
Shangquan, G. (2000). Economic Globalization: Trends, Risks, and Prevention. United Nations Policy Analysis
World Trade Report. (2008). Globalization and Trade. http://www.wto.org/english/res_e/booksp_e/anrep_e/wtr08-2b_e.pdf