Goldman Sachs Projections Largest economies in 2003 Largest economies in 2025 Largest economies in 2050 USA Japan Germany UK France China Italy India Brazil
Goldman Sachs Projections Largest economies in 2003 Largest economies in 2025 Largest economies in 2050 USA USA Japan China Germany Japan UK Germany France India China UK Italy France India Russia Brazil South Korea
Goldman Sachs Projections Largest economies in 2003 Largest economies in 2025 Largest economies in 2050 USA USA China Japan China USA Germany Japan India UK Germany Japan France India Brazil China UK Mexico Italy France Russia India Russia Germany Brazil South Korea UK
Globalisation and the UK
The UK is a highly open economy
Strong trade links with other countries
Over a quarter of our annual GDP is exported
Open financial (capital) markets
We have a fairly open labour market – tolerant of inflows of workers from overseas
Globalisation creates opportunities and threats
The key is to be internationally competitive
Opportunities and benefits for the UK
Cheaper imports from emerging market countries
Keeps down inflation and interest rates
Potential for increasing export sales
Which markets are we best at?
Opportunities for overseas investment
Mergers and takeovers
Direct investment (e.g. new factories overseas; out-sourcing of manufacturing)
Opportunities arising from migration of labour
Opportunities of rapid technological change
Threats for the UK economy
Threats to our manufacturing industries
Risk of structural unemployment
Widening of the rich-poor divide – more inequality
Social and economic tensions from migration
Threats to the global environment – this affects us all
Inflationary risks from higher energy and metal prices
Property boom and bust – think about the origins of this
Takeover of UK businesses from overseas?
Risks of return to protectionism
Threats to current globalisation wave
Commodities – including metals and foodstuffs
World Bank: Food price crisis is the ‘silent Tsunami’
Widening income & wealth inequality within countries (rich and poor)
Bursting of the financial euphoria / bubbles
Huge trade imbalances
Increasing distrust of big business
Growing pressure for
Economic nationalism / trade protectionism
Shift away from multi-lateral trade towards bi-lateral trade agreements
And the threats to the global commons – perhaps the biggest market failure of all time
Globalisation may stall – it is not inevitable
Trade barriers are back!
With the world struggling to come out of recession and economic growth stagnant, barriers to trade are once again on the rise!
US angry at Chinese trade barriers
Questions for discussion:
Why would countries want to erect trade barriers?
How can the UK remain competitive in this new globalised world?
Ten Key Tips!
Use diagrams and ensure they are clear and annotated
Use the sources provided (where appropriate)
Use plenty of real world examples - often exam questions will say “using the data and your own knowledge”
Use precise terminology – learn your definitions well
Pick up on ‘trigger words’ in the exam question i.e. solely, inevitably
Ten Key Tips!
Answer the question but back up any assertion made with evidence or examples
Avoid repeating yourself in a conclusion – try to bring something new into the discussion
Practice drawing key diagrams
Read one topical economics article every day
When writing essay answers – leave a line between each paragraph