Reasons for Globalisation

Globalisation refers to the increasing interconnectedness and interdependence of countries worldwide through the exchange of goods, services, capital, people, and information. It has been driven by various factors, including:

Free Trade Agreements and Economic Trading Blocs

Free trade agreements and economic trading blocs have significantly contributed to globalisation by reducing or eliminating trade barriers like tariffs and quotas. These agreements make it easier and cheaper for businesses to trade across borders, leading to increased international trade and investment.

For example, the North American Free Trade Agreement (NAFTA) between Canada, Mexico, and the United States led to a surge in cross-border trade and investment in North America. Similarly, the European Union (EU), a customs union with free movement of goods, services, capital, and people, has fostered economic integration and boosted trade among its member states.

Improved and Cheaper Transport and Travel Links

Technological advancements in transportation and communication technologies have significantly reduced the cost and time required to move goods, services, and people across borders. Improved transport links like containerisation and air freight have made it easier and cheaper to ship goods internationally. At the same time, the internet and mobile technologies have made communication and information sharing faster and more affordable.

For instance, the development of container shipping has revolutionised international trade by significantly reducing transportation costs and transit times. Similarly, the rise of budget airlines has made international travel more accessible and affordable, facilitating tourism, business travel, and cultural exchange.

In conclusion, the growth of free trade agreements, economic trading blocs, and advancements in transportation and communication technologies have played a crucial role in driving globalisation. These factors have led to increased interconnectedness and interdependence among countries, facilitating trade, investment, and cultural exchange.

**Sources:** * Griffiths, A., & Hill, S. (2019). Business studies. Pearson Education Limited. * Stimpson, P. (2014). Business studies for A level. Cambridge University Press.