THE CONTEMPORARY WORLD: AN INTRODUCTION

“Globalization is a complex web of social processes that intensify and expand worldwide
economic, cultural, political, and technological exchanges and connections.’
- Dr. Cairo

HOW GLOBALIZATION DEVELOPED AND PROGRESSED OVER TIME

1. The Silk Road (1st century BC to 5th century AD)

The Silk Road was a network of trade routes that stretched across the ancient world, connecting
Europe and Asia. It was named for the lucrative silk trade that was established in China at the far
eastern end of the trade route.

Besides silk, the route was also used to transport other goods such as spices, gold, and precious
stones.

The Silk Road is believed to have originated in the 2nd century BCE, during the Han Dynasty in
China. It was initially used by Chinese traders to exchange goods with their neighbors to the
west, including the Roman Empire at the far western end. Chinese silk was widely sought-after
in Rome, Egypt, and Greece.

Over time, the Silk Road expanded and became a major trade route for merchants from all over
the world. It connected China with the Middle East, the Mediterranean, and even Europe. Along
the way, it passed through a number of important cities and kingdoms, including Samarkand,
Babylon, and Constantinople.
Other goods traded along the route included tea, dyes, perfumes, and porcelain from the East.
From the West came horses, camels, honey, wine, and gold.

The Silk Road was not just a trade route, but also a cultural exchange. As merchants and
travelers moved along the route, they brought with them new ideas, religions, and technologies.
The exchange of ideas, religions, and inventions like paper and gunpowder had a major impact
on the cultures of the regions along the Silk Road.

The Silk Road declined in importance as sea routes became more popular in the Middle Ages.
However, its legacy can still be seen today in the cultural connections that were established along
its routes.

2. Spice Routes (7th to 15th centuries)

The new religion spread in all directions from its Arabian heartland in the 7 th century. By the
early 9th century, Muslim traders already dominated Mediterranean and Indian Ocean trades and
could be found as far east as Indonesia, which over time, became a Muslim-majority country.

In the 15th century, spices came to Europe through the Middle East sea and land routes. Spices
became a huge demand both for food dishes and medicinal use.

The Spice Routes, also known as Maritime Silk Roads, is the name given to the network of sea
routes that link the East with the West. They stretch from the west coast of Japan, through the
islands of Indonesia, around India to the lands of the Middle East - and from there, across the
Mediterranean to Europe. It is a distance of over 15,000 kilometres and, even today, is not an
easy journey. From our very earliest history, people have travelled the Spice Routes. At first,
they probably ventured only short distances from their home ports but over the centuries their
ships sailed further and further across seas and oceans. They braved treacherous seas and
eventual hostile reception on arrival in an unknown land. These journeys were not undertaken
purely in the spirit of adventure - the driving force behind them was trade. The Spice Routes
were, and still are, first and foremost trade routes. Since ancient times, trade has had an
important role in human life. When we buy something we are trading, exchanging one item
(usually money) for another. However, our purchase is the final link in a long chain of buyers
and sellers: from the supplier of raw materials, to the manufacturer, to the wholesaler, to the shop
- and if the goods we buy come from abroad there may be several other stages in between.

The journey of the goods between all these links in the chain is what is called a trade route. In
the case of the Spice Routes the links were formed by traders buying and selling goods from port
to port. The principal and most profitable goods they traded in were spices - giving the routes
their name. As early as 2000 BC, spices such as cinnamon from Sri Lanka and cassia from China
found their way along the Spice Routes to the Middle East. Other goods were exchanged too -
cargoes of ivory, silk, porcelain, metals and dazzling gemstones brought great profits to the
traders who were prepared to risk the dangerous sea journeys. But precious goods were not the
only points of exchange between the traders. Perhaps more important was the exchange of
knowledge: knowledge of new peoples and their religions, languages, expertise, artistic and
scientific skills. The ports along the Maritime Silk Roads (Spice Routes) acted as melting pots
for ideas and information. With every ship that swept out with a cargo of valuables on board,
fresh knowledge was carried over the seas to the ship's next port of call.

Today, it may seem strange that the demand for spices was the main reason for such large-scale
trade across such long distances. One probably thinks of them simply as flavouring for food. Yet,
the word “spice” comes from the Latin species, which means an item of special value, as
compared to ordinary articles of trade. Travelling these long distances becomes understandable if
one considers the fact that many of the important spices had ritual and medical values and could
only grow in the tropical East, from South of China to Indonesia as well as southern India and
Sri Lanka. In particular, they grew in the Moluccas or, as they are better known, the Spice
Islands. These are a chain of mountainous islands strung out in the Pacific Ocean between
Sulawesi (Celebes) and New Guinea. From here came the fragrant spices of cloves and nutmeg
which grew nowhere else in the world. To reach the spice markets found across Asia and Europe,
the spices had to be transported thousands of kilometres over the seas.

One may never discover how people came to know and value these spices which grew so far
away. As trading links from Indonesia fanned out through south and central Asia, they met with
links that spread from the Middle East and the north. Goods were exchanged and traders would
return to their homeland carrying the beautifully scented, exotic spices. Perhaps it was their
strangeness and rarity that led great medicinal and spiritual values to be attributed to them. From
ancient times, spices were burned as incense in religious ceremonies, purifying the air and
carrying the prayers of the people heavenward to their gods. They were also added to healing
ointments and to potions drunk as antidotes to poisons. To hide the many household smells,
people burned spices daily in their homes. They were used as cooking ingredients very early on -
not only to add flavour but also to make the food, which was often far from fresh, palatable,
particularly in hot climates.

Myths and legends were woven around these exotic substances. They were linked to strange
beasts like the phoenix, giant eagles, serpents and dragons. In the Fifth Century BC, the Greek
historian Herodotus wrote how the spice cassia grew in a lake “infested by winged creatures like
bats, which screeched alarmingly and were very pugnacious”. Some of these stories were
probably created by the traders who, wishing to protect their profits, tried to hide the sources of
the spices.

The profits to be made from spices were considerable. They were small and dried, and
consequently could be transported easily. The wealth of the spice trade brought great power and
influence and, over the centuries, bloody battles were fought to win control of it and the routes
along which it took place.
3. Age of Discovery/Exploration (15th to 18th centuries)

A series of European expeditions crossing Eurasia by land in the late Middle Ages marked a
prelude to the Age of Discovery. Although the Mongols had threatened Europe with pillage and
destruction, Mongol states also unified much of Eurasia and, from 1206 on, the Pax
Mongolica allowed safe trade routes and communication lines stretching from the Middle East to
China. A series of Europeans took advantage of these in order to explore eastward. Most were
Italians, as trade between Europe and the Middle East was controlled mainly by the Maritime
republics.

Christian embassies were sent as far as Karakorum during the Mongol invasions of Syria, from
which they gained a greater understanding of the world. The first of these travelers was Giovanni
da Pian del Carpine, who journeyed to Mongolia and back from 1241 to 1247. About the same
time, Russian prince Yaroslav of Vladimir, and subsequently his sons, Alexander Nevsky and
Andrey II of Vladimir, traveled to the Mongolian capital. Though having strong political
implications, their journeys left no detailed accounts. Other travelers followed, like French
André de Longjumeau and Flemish William of Rubruck, who reached China through Central
Asia. From 1325 to 1354, a Moroccan scholar from Tangier, Ibn Battuta, journeyed through
North Africa, the Sahara desert, West Africa, Southern Europe, Eastern Europe, the Horn of
Africa, the Middle East and Asia, having reached China. In 1439, Niccolò de’ Conti published an
account of his travels as a Muslim merchant to India and Southeast Asia and, later in 1466-1472,
Russian merchant Afanasy Nikitin of Tver travelled to India.

Marco Polo, a Venetian merchant, dictated an account of journeys throughout Asia from 1271 to
1295. His travels are recorded in Book of the Marvels of the World, (also known as The Travels
of Marco Polo, c. 1300),
a book which did much to introduce Europeans to Central Asia and China. Marco Polo was not
the first European to reach China, but he was the first to leave a detailed chronicle of his
experience. The book inspired Christopher Columbus and many other travelers.
The geographical exploration of the late Middle Ages eventually led to what today is known as
the Age of Discovery: a loosely defined European historical period, from the 15th century to the
18th century, that witnessed extensive overseas exploration emerge as a powerful factor in
European culture and globalization. Many lands previously unknown to Europeans were
discovered during this period, though most were already inhabited, and, from the perspective of
non-Europeans, the period was not one of discovery, but one of invasion and the arrival of
settlers from a previously unknown continent. Global exploration started with the successful
Portuguese travels to the Atlantic archipelagos of Madeira and the Azores, the coast of Africa,
and the sea route to India in 1498; and, on behalf of the Crown of Castile (Spain), the trans-
Atlantic Voyages of Christopher Columbus between 1492 and 1502, as well as the first
circumnavigation of the globe in 1519-1522. These discoveries led to numerous naval
expeditions across the Atlantic, Indian and Pacific oceans, and land expeditions in the Americas,
Asia, Africa, and Australia that continued into the late 19th century, and ended with the
exploration of the polar regions in the 20th century.

During the 15th and 16th centuries, Portuguese explorers were at the forefront of European
overseas exploration, which led them to reach India, establish multiple trading posts in Asia and
Africa, and settle what would become Brazil, creating one of the most powerful empires.

Portuguese sailors were at the vanguard of European overseas exploration, discovering and
mapping the coasts of Africa, Asia, and Brazil. As early as 1317, King Denis made an agreement
with Genoese merchant sailor Manuel Pessanha, laying the basis for the Portuguese Navy and
the establishment of a powerful Genoese merchant community in Portugal. In 1415, the city of
Ceuta was occupied by the Portuguese in an effort to control navigation of the African coast.
Henry the Navigator, aware of profit possibilities in the Saharan trade routes, invested in
sponsoring voyages that, within two decades of exploration, allowed Portuguese ships to bypass
the Sahara. The Portuguese goal of finding a sea route to Asia was finally achieved in a ground-
breaking voyage commanded by Vasco da Gama, who reached Calicut in western India in 1498,
becoming the first European to reach India. The second voyage to India was dispatched in 1500
under Pedro Álvares Cabral. While following the same south-westerly route as Gama across the
Atlantic Ocean, Cabral made landfall on the Brazilian coast— the territory that he recommended
Portugal settle.
Portugal’s purpose in the Indian Ocean was to ensure the monopoly of the spice trade. Taking
advantage of the rivalries that pitted Hindus against Muslims, the Portuguese established several
forts and trading posts between 1500 and 1510.
Portugal established trading ports at far-flung locations like Goa, Ormuz, Malacca, Kochi, the
Maluku Islands, Macau, and Nagasaki. Guarding its trade from both European and Asian
competitors, it dominated not only the trade between Asia and Europe, but also much of the trade
between different regions of Asia, such as India, Indonesia, China, and Japan.
FIRST WAVE OF GLOBALIZATION

The first wave of globalization occurred in the 19 th century to 1914. The first wave of
globalization was occurred over the century ending in 1914. By the end of the 18th century,
Great Britain had started to dominate the world both geographically, through the establishment
of the British Empire, and technologically, with innovations like the steam engine, the industrial
weaving machine and more. It was the era of the First Industrial Revolution.

The “British” Industrial Revolution made for a fantastic twin engine of global trade. On the one
hand, steamships and trains could transport goods over thousands of miles, both within countries
and across countries. On the other hand, its industrialization allowed Britain to make products
that were in demand all over the world, like iron, textiles and manufactured goods.

The resulting globalization was obvious in the numbers. For about a century, trade grew on
average 3% per year. That growth rate propelled exports from a share of 6% of global GDP in
the early 19th century, to 14% on the eve of World War I.

SECOND AND THIRD WAVES OF GLOBALIZATION

The story of globalization, however, was not over. The end of World War II marked a new
beginning for the global economy. Under the leadership of a new hegemon, the USA, and aided
by technologies of the Second Industrial Revolution, like the car and the plane, global trade
started to rise once again. At first, this happened in two separate tracks, as the Iron Curtain
divided the world into two spheres of influence. But as of 1989, when the Iron Curtain fell,
globalization became a truly global phenomenon.

In the early decades after World War II, institutions like the European Union, and other free
trade vehicles championed by the US were responsible for much of the increase in international
trade. In the Soviet Union, there was a similar increase in trade, albeit through centralized
planning rather than the free market. The effect was profound. Worldwide, trade once again rose
to 1914 levels: in 1989, export once again counted for 14% of global GDP.

Then, when the wall dividing East and West fell in Germany, and the Soviet Union collapsed,
globalization became an all-conquering force. The newly created World Trade Organization
(WTO) encouraged nations all over the world to enter into free-trade agreements, and most of
them did, including many newly independent ones. In 2001, even China, became a member of
the WTO, and started to manufacture for the world.

At the same time, a new technology from the Third Industrial Revolution, the internet, connected
people all over the world in an even more direct way. The orders Keynes could place by phone in
1914 could now be placed over the internet. Instead of having them delivered in a few weeks,
they would arrive at one’s doorstep in a few days. What was more, the internet also allowed for a
further global integration of value chains. You could do R&D in one country, sourcing in others,
production in yet another, and distribution all over the world.
The result has been a globalization on steroids. In the 2000s, global exports reached a milestone,
as they rose to about a quarter of Global GDP. In some countries, like Singapore, Belgium, or
others, trade is worth much more than 100% of GDP. A majority of global population has
benefited from this, more people than ever before belong to the global middle class and hundreds
of millions achieved that status by participating in the global economy.

GLOBALIZATION 4.0

In a world increasingly dominated by two global powers, the US and China, the new frontier of
globalization is the cyber world. The digital economy, in its infancy during the third wave of
globalization, is now becoming a force to reckon with through e-commerce, digital services, 3D
printing. It is further enabled by artificial intelligence, but threatened by cross-border hacking
and cyber-attacks.

At the same time, a negative globalization is expanding too, through the global effect of climate
change. Pollution in one part of the world leads to extreme weather events in another. And the
cutting of forests in the few “green lungs” the world has left, like the Amazon rainforest, has a
further devastating effect on not just the world’s biodiversity, but its capacity to cope with
hazardous greenhouse gas emissions.

But as this new wave of globalization is reaching our shores, many of the world’s people are
turning their backs on it. In the West particularly, many middleclass workers are fed up with a
political and economic system that resulted in economic inequality, social instability, and – in
some countries – mass immigration, even if it also led to economic growth and cheaper products.
Protectionism, trade wars and immigration stops are once again the order of the day in many
countries.

THE WORLD WARS

World War I is the most important single event in the history of globalization. The war ended the
first significant era of increasing economic ties among nations and thereby shaped the economic
history of the twentieth century. The war set off both a search for ways to re-create the prewar
liberal world economy and attempts to create statist alternatives to it. The collapse of interbank
cooperation and expansion of controls on trade, migration, and agriculture meant that economic
globalization re-emerged only very slowly over the rest of the twentieth century. Indeed, the
long-term effects of World War I lasted until the 1990s. The lesson of this story for the twenty-
first century is to check the dangers inherent in a multipolar world, where globalization produces
both economic growth and social tensions.

In 1914, the outbreak of World War I brought an end to just about everything the burgeoning
high society of the West had gotten so used to, including globalization. Millions of soldiers died
in battle, and millions of civilians died as collateral damage. War replaced trade; destruction
replaced construction; and countries closed their borders yet again. In the years between the
world wars, the financial markets, which were still connected in a global web, caused a further
breakdown of the global economy and its links.