The term “globalization” refers to the increasing interconnectedness and mutual dependence of national economies worldwide. These connections are a direct result of the fact that people can now communicate with one another effectively without physical meetings.
Technology underpins the significant advances in globalization. For instance, there has been an increase in smartphones and other devices that have enabled individuals all over the world to have a means of communication and idea-sharing right from their location. Also, there is the Internet of Things (IoT), which has made data collection processes easier and more dynamic. People may now connect more easily because of the increased speed at which information is moving.
There is an ICT revolution, which has led to a major rise in the internationalization of all digital services and made society more competitive, demanding, and fast-paced. The reason for this is not farfetched. Since many businesses and professionals make deals on trade, investments, and communication largely over the internet, there is more pressure to compete on an international level. So, the life cycle of products gets shorter, and over time, the production, distribution, and supply chains get more integrated.
Foreign direct investments, trade, migration, and even the flow of capital are all examples of how this trend has contributed to what is now known as economic globalization. Collectively, these factors promote global trade, the development of which is heavily reliant on the internet. Almost every company in the world uses technology to conduct business.
Technological advancements that have affected globalization in several ways including;
- Mobile payments : In the past, individuals had to be ready to pay any amount in cash. When people were required to pay large sums, they carried large amounts of cash in bags and often hired security to help the money safe which in turn cost more. After sometime, cheques came into the picture however even till now people don’t trust the validity of cheques as they bounce and take long hours to clear. Mobile payments however have changed how we live, putting more people in touch with business opportunities. Mobile payments are making a big difference in how we live. As it is fast, simple and safe. Mobile payment services make it possible to safely pay on the go, these same services are making life easier and more convenient especially for people around the world who live in remote places. It is much easier for them to take part in global trade, either as consumers or as businesses.
- Blockchain: The global trade supply chain is changing a lot by blockchain and distributed ledger technologies that use blockchain. Blockchain technology is being used to solve problems with global trade, like high costs and a lack of security and transparency. Blockchain-based solutions are not only making the movement of goods faster and more reliable, but they are also shaking up the world of trade financing. For example, blockchain is being used to make it easier to get a Letter of Credit (LoC), which is a way to pay for international trade. Getting a LoC used to be a long and complicated process.
- Machine learning and artificial intelligence : Artificial intelligence and machine learning are being used to find the best trade shipping routes, manage ship and truck traffic at ports, and translate e-commerce search queries from one language into other languages and respond with translated inventory. AI is being used to make global trade more stable in more ways than just making it more efficient and giving customers better service, examples include chatbots, etc
- Digital Trade and E-commerce Platforms : Online platforms like Upwork make it easier to trade services. Users can find service providers from all over the world for a wide range of services. These digital platforms make it easy for customers and service providers to connect in a way that wasn’t possible in the past, when these kinds of professional services were mostly done in person. Digital platforms help business customers around the world connect with service providers and make it easier to find the right professional for their needs.
The effect of these technologies has been especially good for emerging market economies, which have been using more foreign knowledge and technology to help come up with new ideas and make their workers more productive. With all the uncertainty in the world today, the future of international trade looks exciting because of new technologies. With the right way of doing things, these new ideas will make trade growth more efficient and open to more people in the future. Because of progress in technology, the world has become a global village where people can talk, work, and do business without leaving their homes. As new technologies are made every day, there is a better chance that these and other fields will get better in the near future.
Article Submitted by Aderonke Folorunso, Director of Enterprise Sales, Prunedge