Examine the Significance of Factors Which Have Contributed to Increased Globalisation in Recent Years.

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Globalisation is not new, but its pace and scope has accelerated in recent years. Firstly, the rapid rise in globalisation in recent years is the result of a fall in transportation cost. This is because of the emergence of many logistic firms which lead to fierce price war in order to increase its market share. Also, the usage of larger containerships which allow cost per container carried to be cheaper combined with the advancement in the mode of transport such as air flight encourages imports and exports with greater geographical reach. Other than that, the creation of trading bloc such as NAFTA, EU and ADEAN will allow member countries to remove or reduce trade barriers in order to increase trade between member countries. This is because, government-imposed restrictions such as the imposition of common external tariffs or other non-tariff barriers such as import quotas goods and services between member countries are unhindered. Thus, this leads to trade creation between countries that never have strong relationship before. Lastly, the establishment of WTO has been proven a success in the contribution of increase globalisation to increase international trade by lowering trade barriers and providing a forum of negotiation. This is evident in 2004 as it was successful in putting an end to the Multi Fibre Agreements hence removing the quotas on textiles import. This allows greater import penetration since both first world and third world countries remove such trading barriers therefore more trades can be conducted. On the other hand, whether a fall in transportation cost contributes to globalisation is arguable. This is because, the accession of China into WTO in 2001 has contributed towards rapid industrialisation which led to a dramatic growth in the export sector in China. This ultimately means that there will be an increase in demand of oil which causes a rise in oil prices. Also, the increase in number of ships has costs rise in maritime traffic, leading...
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