Lesson video

Hello, and welcome to lesson three of the Globalisation unit.

In this lesson we're going to be looking at, how does globalisation affect trade? Let's have a look at the agenda together now.

So the first thing that we're going to look at in today's lesson is, what is trade? Then we'll look at, how has globalisation affected trade? And then lastly, we'll look at, how does trade affect different people? And for this lesson, you'll need three things, an exercise book or paper, a pencil or a pen, and most importantly, our brains.

So pause the video to make sure you've got those things, and then when you're ready to get learning, resume the video and we will get started.

In this first part of the lesson, we're going to be looking at, what is trade? And this is really important, because if we are going to understand how globalisation affects trade, then we need to have a rock solid understanding of what trade actually is.

So, here is the definition for you.

Trade is, the buying and selling of goods and services.

I'm going to repeat that again.

Trade, is the buying and selling of goods and services.

Now, what I'd like you to do is say that back to me, what is trade by the way? That's right, trade is the buying and selling of goods and services.

And a key thing to know about trade is there are two sort of key aspects of trade.

There are imports, so those are the goods and services that we are bringing into our country.

And there are also exports.

So those are the goods and services that are leaving our country.

And a good way of remembering that is exports, it's got the word ex.

It's like that exiting our country.

So remind me, what is trade? That's right, it's the buying and selling of goods and services.

So what I'd like you to do now to help solidify that definition in your mind, is to write your own sentence using the word, trade.

For example, here's a little sentence I wrote earlier.

Trade has increased because of globalisation.

So your sentence doesn't need to be really complicated.

Just write any sentence using the word trade, and make sure it completely makes sense.

And to help you out, I've put the definition of trade there to facilitate your writing of that sentence.

So when you're ready, pause the video to complete your task and resume once you're finished.

Okay, I wonder what you wrote down? Something to do with trade I hope, I'm sure it was absolutely, excellent.

So we know that trade is the buying and what is it? Selling of goods and services, nice one.

What I'd like you to think about now, is have a look around the room you're in.

Look at the different objects and things that are in your room, and have a think about what types of goods in your house are traded or have been traded and imported into the country.

I'll just Give you a moment to scan the room.

Well, I did this exercise this morning.

And it was a very interesting exercise for me.

So for example, this morning, I had a delicious breakfast.

In my breakfast I had some bananas.

Now bananas, sadly do not grow on trees where I live, which is London.

So the bananas I had for breakfast have been traded.

They have been imported into Britain from Costa Rica.

So an example of how foreign goods travel as part of trade.

I then had a shower, and I washed my hair.

And I used a shampoo bottle where the plastic container was made in China.

And the liquid itself, the shampoo itself, was actually made in Switzerland, crazy right? Seemingly the same object, but the different things that make up that object have been treated from very different parts of the planet.

I now I'm sat here recording my lesson on a laptop, and my laptop, contains parts from I checked this, Russia, Chile, Korea, Zimbabwe, and California.

And that is not every single part, my laptop contains parts from all over the world, because all the different little components that make up my laptop, have been traded.

Because trade remember, is the buying and selling of goods and services.

And trade leads to different objects, goods and services, travelling from all over the globe, into our country.

Let's move on to the next part of the lesson.

In this second part of the lesson, we're going to be looking at, how has globalisation affected trade? And the first thing that you need to know, is that globalisation has significantly increased trade.

And that is why, if you think back to the objects I just went through, that's why we have so many different objects in our homes that come from all over the world because trade has been increasing massively, particularly over the past 200 years.

But how has globalisation actually helped with that? Well, the first reason that globalisation has helped increase the amount of trade taking place is because the increased connections, that have come about because of globalisation have made it much easier to trade.

So if you think about, for example, the internet, that has significantly made it easier for people to buy things from different countries.

Or improving transport, has made and increased those connections between countries making it far easier to trade.

Now, another reason how globalisation has helped, is because globalisation has helped people in many countries earn more money.

And when people have more money, they have more money to spend on goods and services.

And when people have more money to spend on those things, it leads to more companies developing, to provide those goods and services.

So people have more money, they've got more money to spend on goods and services.

So new companies develop, in order to provide even more goods and services.

And then the last reason why globalisation has helped is because globalisation, has helped make technology become cheaper.

And this technology, has made it quicker and easier for companies to produce products.

They've reduced the time it takes to make them, and they've reduced the cost.

So globalisation has played a very important role.

So to sum up, globalisation has helped trade because it's increased the connections between countries.

Globalisation has helped increased trade because people now have more money to spend on goods and services.

So more companies are developing to produce those goods and services.

And globalisation has also helped because technology is now cheaper.

And that technology makes it quicker and easier to produce the goods and services that people want to buy.

Based on that information, you're now going to complete the following task.

Please answer the following questions one, two and three, in nice, neat sentences.

And when you're ready, pause the video to complete your task and resume once you're finished.

And if you're wondering how to get started with those sentences, here is some sentence starters for you to use.

Okay, let's go through those answers together now.

Question number one, how has globalisation led to increased trade? Let's have a think, here's what I wrote down.

Globalisation has led to increased trade because, it has increased connections around the world, making it easier to trade.

So as long as you are mentioning increased connections, making it easier to trade, you've done the right thing there, good job.

Question number two, how has people becoming richer, increased trade? Here's what I wrote.

People becoming richer has increased trade because, people have got more money to buy goods and services.

And as a result, more companies develop to provide the goods and services.

Okay, so the key things to mention are, the fact that people got more money to spend on goods and services, and new companies are created or developed in order to keep up with the demand and to provide those goods and services.

And then question number three, how has technology becoming cheaper, increased trade? I remember, this has helped in two ways, one of those two ways.

Here's what I wrote.

Technology becoming cheaper has increased trade because, the time and cost of making products have been reduced.

So you don't have to spend as much money on making products and it doesn't take as long to make them.

So, well done on completing that task.

Let's move on to the final part of this lesson.

What we're going to look at in this final part of the lesson is how does trade affect different people? Because trade and the massive increase of trade obviously brings benefits to lots of different people.

However, it also bring some negative effects to different people.

So we're going to have a little look at two different scenarios and reflect on what are the positives of this situation? And what are the negatives of this situation? So let's get started.

So this is Scenario number one, okay? And this is very like a real life situation, which happens all the time.

So in this scenario, lots of factories are now able to move to other countries, because technology and transport, means that they can do that and produce their products for a cheaper amount.

However, it does mean that the people in the countries that they're now moving to, are paid less money.

So just to summarise, factories are moving to other countries because they can do now, because of technology and transport.

In those countries, it costs less to produce the products and the workers are paid less.

Here's what I want you to do now.

Have a think about, what are the advantages and disadvantages of that scenario? Pause the video to jot down your thoughts, and then we'll reflect on it together in a moment.

Okay, what did you come up with? I've got a series of positives and negatives or advantages and disadvantages to this.

So in terms of advantages, well, the main thing is that when that company moves their factory to another country, in that country, they are creating lots of jobs, which is great.

Jobs are very important for people to be able to have a life of, you know, opportunity and being able to buy things that they need.

Another advantage just for the company, is that they can make their products more cheaply now.

And when companies don't have to spend as much money on their products, that means they're making more money ultimately.

However, I also came up with a couple of disadvantages.

Did you spot any disadvantages? Here are my disadvantages.

Number one, when that company or the factory moves to another country, all the people that originally were working in that factory, no longer have their jobs.

So while it is creating jobs in one country, it does mean the people in the original country no longer have their jobs.

And also, what do you remember about the salaries of the people in the new factory? What's that? That's right, in the new factory people are paid less.

So, they are getting jobs, but they are not getting paid as well.

And in many situations like this, people end up getting paid quite badly.

So this scenario shows us that there are many advantages to this globalised trade, but there are also disadvantages as well.

Let's have a look at another scenario.

So this is a real life scenario.

And some regions now in parts of the world, in terms of their agriculture, they have decided to just become experts and mainly focus on growing one type of product.

In West Africa, their focus is generally on producing cocoa, or cocoa beans, the things that make delicious chocolate.

And in fact, so West Africa produces 65, sorry, 66% of the world's cocoa, which is extraordinary.

However, because trade is expanding, and people who need cocoa beans in large quantities, they can get it from all different parts of the globe.

That means the farmers in West Africa, are having to keep their prices very low, so that the people who buy their product, don't go to other suppliers to try and get.

So to sum up, West Africa has decided to focus mostly growing cocoa beans, they provide 66% of the world's cocoa beans.

But because trade is expanding and people can get cocoa beans from different parts of the world, the farmers in West Africa, are forced to keep their prices very low.

Again, a complex scenario this, let's have a think about what are the advantages and disadvantages of this scenario? And pause the video, to just jot down your thoughts or write down your thoughts and what you think the different advantages and disadvantages of this scenario are.

Okay, let's go through this together.

Another complex situation, right? Well, the advantages are, that the expansion of trade will mean that there are more and more people buying cocoa beans from West Africa.

And they're doing pretty well, right? Because they are producing 66% of the world's cocoa beans.

Fantastic, great job.

However, a big disadvantage here is, that they are forced to keep their prices really low.

So that, the competition or so that the companies don't buy their cocoa beans elsewhere.

And that means the farmers aren't going to be making as much money as they could do, in what is a very, like it's a lot of hard work farming and growing cocoa beans and they're not making that much money.

And also another disadvantage is, if the companies did decide to all of a sudden buy their cocoa beans elsewhere, because other countries are selling it at a cheaper price then unfortunately, West Africa has mostly been specialised in growing cocoa beans.

So they don't have the same expertise in other areas necessarily, all those cocoa bean farmers will have to move on to another product, and that is a very difficult thing to do.

So, hopefully you got some similar advantages and disadvantages, and maybe you found something that I didn't, I'm sure you did.

Essentially, what I would like you to come away with this though, is understanding that while trade brings lots of opportunities to many different people, that it affects people very differently.

And sometimes there are disadvantages to the globalisation of trade.

That brings us to the end of this lesson.

I hope you've enjoyed it, and well done on all the fantastic learning that you've done.

Before we finish though, there are just two things that you need to do, please remember to write down three key things that you will remember from the lesson.

That's really helpful in solidifying the knowledge in your mind.

And then lastly, don't forget to complete the exit quiz at the end.

That's going to be a great way of seeing the tremendous progress you are making in this unit.

Thanks again, and I look forward to teaching you again soon.