GLOBALIZATION

The death of globalisation has been

announced many times.
But this is a perfect storm

1. Over the last half-century the world has been transformed by huge flows of trade and
investment. The source of our food and the manufacture of everything from trainers to
mobile phones has been revolutionised. Bank inquiries in Newcastle are handled in
Bangalore. Secure industrial jobs have evaporated in Europe and North America and
reappeared on the other side of the world. Exports, which amounted to less than 10% of
global GDP in the 1970s, now stand at 25%.

2. Globalisation has been a massive social and economic transformation. It has, by the same
token, been hotly contentious, creating losers as well as winners. And this raised the
question: would it be brought to an end by eruption of opposition? Again and again – after
the 1999 Seattle WTO protests, September 11, the financial crisis of 2008 and the election of
Donald Trump – there have been predictions of globalisation’s terminal crisis. In the
background lurks the memory of the 1930s and the Great Depression, when trade and capital
flows contracted, not to recover for the best part of half a century.

3. But the Covid-19 shock has raised globalisation angst to a new pitch. The World
Trade Organization (WTO) is predicting that trade may fall by a record 32%. The lockdowns
were disruptive enough. But as the economic crisis deepens, 2020 is beginning to look like
something worse: a perfect disruptive storm.

4. To see why, consider the range of factors that shape the international division of labour.
Start with politics.

5. The pursuit of profit extends across national borders and lines of political conflict. But if
you are going to set aside politics and diplomacy, you need to agree to differ. It helps if you
have an arbiter, a global hegemon. It is no coincidence that the surge in global trade and
investment coincided with what seemed like decisive American victory in the cold war.

6. In addition to politics, the flow of goods is driven by technology. The Industrial Revolution
of the late 18th century centred on cotton. A quarter of a millennium later the garment
supply chain still spans the world, from the cotton farms of Australia to sweatshops in
Bangladesh and big box malls in American suburbs, now empty of customers. Twenty-first
century smartphones are produced by a hyper-sophisticated network linking labs and
software coders in the west with chip foundries in South Korea and Vietnam and assembly
lines in China and Vietnam. The greatest single driver of globalisation in recent years has
been containerisation, which slashed the cost of shipping.

7. Apart from politics and technology, who makes what, and where, is decided by the terms
of trade, which depend on the balance of costs and prices and the matrix of exchange rates.
Sudden movements in currencies shift costs, disrupting existing patterns of demand and
supply.

8. Finally, whether we have the appetite to buy goods – made at home or abroad – depends
on the overall state of the economy, on what economists call “aggregate demand”, the sum
of consumption, investment and government spending.

9. Add together technology, price effects, macroeconomics and geopolitics and it becomes
clear why, in 2020, we face a perfect storm.

10. On the technological front, containerisation and the revolution in outsourcing have run
their course. The car industry, which operates the most complex supply chains, is
undergoing a technological revolution. The advent of electric cars (or what the industry calls
“e-mobility”) will simplify and shrink production, cutting millions of jobs. Consultants like
McKinsey’s reckon that it will only be a matter of time before the armies of female factory
workers currently employed in cutting and sewing clothes will be replaced by robots.

11. Meanwhile, the Covid-19 recession has slashed consumption and investment. The US is
by far the largest importer, and its demand has been hammered. The current strength of the
dollar will go some way towards offsetting the fall in American consumption. A more
valuable dollar makes it more attractive to export to the US. But it may also trigger new trade
wars.

12. Particularly aggravating to the White House will be the fall in the Brazilian currency, the
real. Trump may regard the Brazilian president Jair Bolsonaro as a kindred spirit, but he will
not like the huge surge in Brazilian exports as China’s pig farmers opt for the cheapest source
of animal feed.

13. The promise of increased agricultural exports from the US to China was key to the so-
called phase one trade deal, solemnised in January. At least for a few weeks early this year
Trump stuck to the phase one script. But that restraint has not lasted. Since April there has
been a truly spectacular escalation in rhetoric between Washington and Beijing.

14. Trump’s nationalist bluster plays to his gallery. China makes a good stick with which to
beat Joe Biden, who is reputed to favour a more cooperative line. Altogether more serious is
the systematic reorientation in US strategy towards China that had already begun under
Barack Obama, with the “pivot to Asia” in 2011, and culminated in May 2020 with the
release by the Trump administration of a comprehensive new strategy document.
15. The document ends any further discussion in Washington of the possible convergence of
China with the western model. Instead, all branches of American government are sworn in
on a posture of great power competition. Nor is this merely rhetoric. It goes hand in hand
with a further round of sanctions against China’s telecoms champion, Huawei. By refusing
to allow chips for Huawei, even chips of Huawei’s own design, to be manufactured on ultra
hi-tech equipment that Taiwanese chip foundries source from the US, the Trump
administration has effectively declared a technological war.

16. Meanwhile, the UK has announced its decision to exclude Huawei from its 5G network
within three years. Australia and China are embroiled in a mini-trade war over barley and
beef. Huawei executive Meng Wanzhou awaits her fate under house arrest in Canada. If she
is extradited to the US, expect a storm to break loose.

17. Of course, there are countervailing forces. Business, including American business,
remains deeply committed to foreign investment and trade. Europe is reluctant to choose
between the US and China. Angela Merkel has announced that she will make relations with
China one of the priorities of Germany’s presidency of the European council.

18. But, deal-making apart, the broader vision of the flat world of globalisation is dead. The
institution that most clearly embodied that “end of history” vision, the WTO, was launched
in January 1995. Today, the WTO is in tatters. Its dispute-processing procedures have been
paralysed by deliberate American obstruction and its head, Brazilian Roberto Azevêdo, has
announced that he is resigning a year ahead of time, which leaves the WTO leaderless in the
face of the greatest shock to world trade since 1945.

19. Comparisons with the 1930s should not be taken too far. We don’t live under the shadow
of total war, and there are good reasons to welcome the end of 1990s-style hyper-
globalisation. But we should not underestimate the break with the recent past or kid
ourselves that there is any obvious alternative on offer.

READING COMPREHENSION

I. Words and expressions

Explain the meaning of the following words and phrases, as used in the article:
1. globalisation's terminal crisis (par.2)
"Globalisation's terminal crisis" refers to a situation where it is believed that globalization
is facing an ultimate or final crisis that could potentially lead to its demise. In the
context of the article, it means that there have been multiple instances in the past when
experts predicted that globalization was on the brink of collapsing or permanently declining.

Terminal: End or Final Point

2. has raised globalisation angst to a new pitch (par.3)
"Has raised globalisation angst to a new pitch" means that the anxiety, concerns, or worries
surrounding globalization have reached a higher level or a more intense state. The article is
suggesting that the COVID-19 shock has intensified the worries and fears associated with
the future of globalization.
angst: a feeling of deep anxiety, dread, or existential unease
a new pitch : a different level, intensity, or state of something. For example, "raised to a new
pitch" means it has been increased or intensified to a higher degree.
3. a perfect disruptive storm (par.3)
disruptive: troublesome, causing or tending to cause disruption.
"A perfect disruptive storm" implies a situation where various factors and events have
combined to create a severe disruption or crisis. In this context, it indicates that the COVID-
19 pandemic and its economic consequences have created an exceptionally disruptive and
challenging situation for global trade and the international division of labor.

4. the garment supply chain still spans the world (par.5)

garment: fashion industry
"The garment supply chain still spans the world" means that the network of manufacturing
and distribution involved in the production of clothing continues to extend across the globe. It
emphasizes the global nature of the supply chain, with different components of the process
taking place in various countries.
5. aggregate demand (par.7)
aggregate : total/overall
Aggregate demand" refers to the total demand for goods and services within an economy. It
includes the sum of consumer spending, investment, and government expenditure, which
collectively drive economic activity.
6. have run their course (par.9)
"Have run their course" means that certain processes or developments have reached their
natural conclusion or have been exhausted. In the context of the article, it suggests that
certain technological and economic trends, like containerization and outsourcing, have
reached their limits or are no longer as impactful as they once were.
7. a truly spectacular escalation in rhetoric (par. 12)
"A truly spectacular escalation in rhetoric" indicates a significant and remarkable increase in
the use of strong, provocative, or inflammatory language in communication. In this case, it
highlights that there has been a dramatic rise in the intensity of verbal exchanges between
Washington and Beijing.

rhetoric: hùng biện: the art of effective or persuasive speaking or writing

8. It goes hand in hand with (par. 14)
"It goes hand in hand with" means that one thing is closely associated or connected with
another. In the article, it is used to emphasize the close relationship between the change in
U.S. strategy toward China and the use of sanctions against Huawei.
9. expect a storm tobreak loose (par. 15)

"Expect a storm to break loose" implies that one should anticipate or be prepared for a
sudden and intense upheaval or controversy. It suggests that if certain events, like the
extradition of Meng Wanzhou, occur, there will be significant consequences and turmoil.
break loose : escape
I. Comprehension questions
Answer the following questions in your own words:
1. What has "globalisation" been described in the last half-century?
In the last half-century, "globalisation" has been described as a significant transformation
characterized by the massive flows of trade and investment, which have revolutionized the
sourcing of food and the manufacturing of various products, the outsourcing of services, and
the movement of jobs from one part of the world to another.

2. How has the Covid-19 pandemic affected globalisation?

The Covid-19 pandemic has severely impacted globalization by causing disruptions in
international trade and supply chains. Lockdowns and economic crises have created a
situation where 2020 is viewed as a "perfect disruptive storm" for globalisation.
3. What can be explained for the gloomy predictions about 2020?
Gloomy predictions about 2020 can be explained by a combination of factors, including the
Covid-19 pandemic's disruptive effects on trade and supply chains, the economic recession,
and the escalating tensions between countries, particularly the United States and China.
4. How will the car industry be affected?
The car industry is expected to be affected by the rise of electric cars (e-mobility), which will
simplify and streamline production, potentially resulting in the reduction of millions of jobs,
particularly those related to traditional combustion engine vehicles.
5. What will the increase in the US dollar strength lead to?
An increase in the strength of the US dollar will make it more attractive for other countries to
export to the US, as their products become relatively cheaper. However, this could also lead
to new trade tensions and conflicts.
6. What has made the relations between the US and China tense since
April?
Relations between the US and China have become tense since April due to a "spectacular
escalation in rhetoric" and an increase in confrontational language and actions between the
two countries.
7. What has Trump administration added to the existing tension between
China and the US?
The Trump administration has added to the existing tension between China and the US by
implementing further sanctions against Huawei, a prominent Chinese telecommunications
company, which has effectively led to a technological conflict with the restriction of chip
production for Huawei.
8. How has Angela Merkel evaluated the relations with China?
Angela Merkel, the Chancellor of Germany, has stated that she will prioritize improving
relations with China during Germany's presidency of the European council. She seems to
aim for a balanced approach and cooperation with both the US and China.
9. According to the author, what does the WTO represent?

According to the author, the World Trade Organization (WTO) represents an institution that
embodied the vision of a globalized world but is currently in a state of disarray, with its
dispute resolution mechanisms paralyzed due to American obstruction and the organization
being leaderless in a time of significant global trade challenges.
1. Trong nửa thế kỷ qua, "toàn cầu hóa" đã được miêu tả như một sự biến đổi quan trọng,
được đặc trưng bởi các dòng chảy lớn của thương mại và đầu tư, đã làm thay đổi cách
cung cấp thực phẩm và sản xuất các sản phẩm khác nhau, việc giao phó dịch vụ và việc di
chuyển việc làm từ một phần của thế giới sang một phần khác.

2. Đại dịch Covid-19 đã tác động nghiêm trọng đến toàn cầu hóa bằng cách gây ra sự đảo
lộn trong thương mại quốc tế và chuỗi cung ứng. Việc giới nghịch và khủng bố kinh tế đã
tạo ra tình hình nơi năm 2020 được xem như một "cơn bão đảo lộn hoàn hảo" cho toàn cầu
hóa.

3. Các dự đoán u ám về năm 2020 có thể được giải thích bằng sự kết hợp của các yếu tố,
bao gồm các tác động đảo lộn của đại dịch Covid-19 đối với thương mại và chuỗi cung ứng,
suy thoái kinh tế và sự leo thang căng thẳng giữa các quốc gia, đặc biệt là Mỹ và Trung
Quốc.

4. Ngành công nghiệp ô tô dự kiến sẽ bị ảnh hưởng bởi sự tăng trưởng của xe điện (e-
mobility), sẽ đơn giản hóa và tối giản quá trình sản xuất, có thể dẫn đến giảm hàng triệu việc
làm, đặc biệt là liên quan đến xe chạy bằng động cơ đốt trong truyền thống.

5. Việc gia tăng sức mạnh của đô la Mỹ sẽ làm cho nó trở nên hấp dẫn hơn cho các quốc
gia khác để xuất khẩu sang Mỹ, vì sản phẩm của họ trở nên tương đối rẻ hơn. Tuy nhiên,
điều này cũng có thể dẫn đến các căng thẳng và xung đột thương mại mới.

6. Mối quan hệ giữa Mỹ và Trung Quốc đã trở nên căng thẳng kể từ tháng 4 do sự "leo
thang ngoạn mục trong lời nói xấu" và sự gia tăng mạnh mẽ về ngôn ngữ và hành động
xung đột giữa hai quốc gia.

7. Chính phủ Trump đã gia tăng căng thẳng đã tồn tại giữa Trung Quốc và Mỹ bằng cách
thực hiện các biện pháp trừng phạt khác với Huawei, một tập đoàn viễn thông hàng đầu của
Trung Quốc, đã dẫn đến hiệu quả xảy ra xung đột công nghệ với việc hạn chế sản xuất chip
cho Huawei.

8. Angela Merkel, Thủ tướng Đức, đã tuyên bố rằng cô sẽ ưu tiên cải thiện quan hệ với
Trung Quốc trong suốt thời gian Đức đảm nhiệm chủ tịch Hội đồng Châu Âu. Cô dường như
đang hướng đến một cách tiếp cận cân đối và hợp tác với cả Mỹ và Trung Quốc.
9.
Theo tác giả, Tổ chức Thương mại Thế giới (WTO) đại diện cho một tổ chức đã thể hiện
tầm nhìn của một thế giới toàn cầu hóa nhưng hiện tại đang trong tình trạng lộn xộn, với các
cơ chế giải quyết tranh chấp của nó bị tê liệt do sự cản trở của Mỹ và tổ chức thiếu người
lãnh đạo trong bối cảnh thương mại thế giới đối mặt với những thách thức quan trọng từ
trước đến nay.

III. One-sentence main idea

Based on your understanding of the reading passage, wrie down the main idea in one
complete sentence.

Globalization, which has experienced numerous challenges and predictions of its demise
over the past half-century, is facing a significant and unique crisis in 2020 due to the
disruptive impact of the COVID-19 pandemic, technological changes, shifting economic
factors, and escalating geopolitical tensions, which may mark a fundamental transformation
in the future of global trade and international relations.

Today, I stand before you to discuss a topic that has reverberated through the annals of

history, a topic that has seen countless predictions and proclamations of its imminent end.

That topic is globalization, and the author's statement, "The death of globalization has been

announced many times," serves as a poignant reminder of the enduring, dynamic, and

resilient nature of this global phenomenon.

Globalization, the process of increased interconnectedness and interdependence across

borders, is a multifaceted and complex force that has transformed the world over the last

half-century. From the way we source our food to the manufacturing of everyday goods, the

impact of globalization is undeniable. Bank inquiries in one part of the world are handled in a

different part, and the source of our daily products spans continents.

Yet, this transformative force is far from uncontroversial. Globalization has generated both

winners and losers, sowing the seeds of dissent and debate. It has been at the heart of trade

disputes, political turmoil, and economic inequalities, leading many to question its

sustainability.

Historically, we have witnessed the periodic heralding of globalization's death knell. From

the anti-globalization protests in Seattle in 1999 to the shocks of September 11, 2001, and

the global financial crisis of 2008, there have been moments when it appeared that

globalization might crumble under the weight of these crises. The election of figures like

Donald Trump, with a protectionist agenda, intensified these predictions.

The specter of the 1930s and the Great Depression looms large in the background of these

discussions. It serves as a reminder that, during the 1930s, trade and capital flows

contracted dramatically, and the recovery took decades.

But it is the COVID-19 pandemic that has elevated the concerns about globalization to new

heights. The disruption it brought to global trade and supply chains, as well as its economic

ramifications, have created what the author refers to as a "perfect disruptive storm." As we

grapple with the fallout of this pandemic, we must also consider its impact on the future of

globalization.

However, it is essential to recognize the countervailing forces at play. The global business

community, including American enterprises, remains deeply committed to foreign

investment and trade. Europe remains reluctant to pick sides between the United States and

China, emphasizing cooperation as a way forward.

The article also highlights that the broader vision of a flat world of globalization, often

associated with the World Trade Organization (WTO), is under severe strain. The WTO,

established in 1995 to promote global trade, is now in tatters, with its dispute resolution

mechanisms paralyzed and leadership in disarray.

In conclusion, while the death of globalization has been predicted multiple times, it is clear

that globalization remains a force to be reckoned with. It has proven its resilience,

adaptability, and capacity to overcome challenges throughout history. We should

acknowledge the inherent complexity of this phenomenon and continue to assess its future

in a world where interconnectedness is the new norm. The death of globalization may have

been announced many times, but it is clear that globalization's story is far from over. Thank

you.