Sample Communications Paper on Globalization


Despite its first use in the 20th century, a universal definition of globalization is nonexistent. Scholars, economists, and historians among other specialists have subjective definitions of the word (Rzepka 2011, p. 453). Although a diverse range of definitions exists, each of them, agree on certain aspects of the word, including global impact, some form of integration, communication, and travel on a global scale. As an eclectic phenomenon, globalization has had a great impact on individual countries’ economies, population composition, culture, and national image. Thanks to globalization, the U.S. and Canada have a multicultural and multiethnic population, while goods from as far as Russia easily reach Australia in the deep of the Atlantic Ocean. Perhaps the greatest impact of globalization has been on the world economy as well as that of specific nations (Das 2010, p. 46). The 2007-2010 global financial crisis that started in the U.S. and had rippling effects across the world is a testament to the interconnected nature of the world in modern times as a result of globalization. While many countries have proof of the impact of globalization, China, the world’s second largest economy, is perhaps the aptest attestation to the economic impact of globalization. The previously largely agrarian country with the bulk of its population living in rural areas is currently the world’s industrial area. Foreign direct investment (FDI) inflows in manufacturing have especially been responsible for China’s exponential growth. Statistics show that the nation’s

GDP growth over the past few decades has been proportional to increased FDI inflows. In the analysis of the impact of globalization, China provides a perfect exemplar, as it can attribute its recent decades-long spurts of growth, cultural, and policy changes to globalization.

Birth and Definition of Globalization

The origin f globalization is not clear, but different scholars have distinct theories. According to Rzepka (2011), the expansion of European capitalism marked the birth of globalization. On the other hand, Rzepka (2011) believes that globalization is “connected to the end of the Second World War, development of the nuclear age, colonial countries gaining independence, renewed business expansion, and the economic development of South-East Asia countries” (p. 453). The recent information technology revolution has been said to have influenced the advent of globalization

The word globalization has more than 200 definitions; however, what stands out in all the definitions is the relation of the economy and widespread (to the world) presence. One of the definitions of globalization is that it is “the integration of national economies in the direction of an international trade-based economy, direct foreign investment, short-term capital flows, the international flow of workers and people in general, as well as the flow of technology” (Rzepka 2011, p. 453). The definition heavily relies on the economic aspect of the view of globalization as a phenomenon. Another economist definition of globalization is that the term refers to the “the increased speed, frequency, and magnitude of access to national markets by non-national competitors” (Wolf 2000, p.3). Alternatively, the term is described as a historical process through which goods, capital, and labor markets are opened and unified into one global market. A basic definition of globalization is that it is an international relationship between economies.

In all the definitions mentioned above, the relationship between previously independent economies is apparent. As such, through globalization, different economies find ways to benefit from the phenomenon mutually. The relation goes beyond economics to technology, labor, and consumer markets. Most importantly, globalization involves people; hence it facilitates the transfer of culture, beliefs, and attitudes, which are the embodiments of human nature and interactions.

Impact of Globalization in China

Economic Development

China’s recent exponential economic development is mostly attributed to globalization. The impact of the phenomenon on the nation’s economic development is evident in the growth in not only the economy but also international trade as well. Over the past 20 years, China’s international trade grew 16 times ranking the nation as one of the tops in the world. Additionally, the country has grown its trade dependence, shifting from the previous 10% to 36%, hinged on exports from it (Yue 2012). Therefore, the country’s economic development continues to heavily rely on globalization as seen from the growth of Chinese private and State-owned Enterprises.

Perhaps the most visible impact of globalization on China’s economic development is on its GDP. China’s GDP grew between 2007 and 2017, although not as fast as at the start of the decade (see fig 1). Part of the slowdown in the growth is attributed to globalization, which has pushed the Chinese government into investing, particularly outside the country. In the article, “China’s Economic Growth in 2015 is Slowest in 25 Years,” Mark Magnier reports the slowing Chinese economic growth, which has fallen short of the country’s projections with a moderated percentage of 6.8. Magnier (2016), posits that the country’s growth in 2016 declined from the 6.9 percent growth that it had experienced in 2015.

Fig. 1: Growth of China GDP. Source: Lu (2018)

The slowing growth has been a concern for the political leadership with president Xi Jinping urging economists and officials to stabilize the country’s short-term growth (Magnier 2016). According to the article, the growth slump is attributed to slow growth in the industries that power the economy such as construction and mining. The Chinese government has put measures to control the slowdown, including encouraging consumption rather than investment, as has been the norm.

The integration of China within the global market through globalization means that any change in its economic development affects other nations, corporations, and individuals with investment in the country. It is for this reason that the current Chinese growth rate is a worry for many who have invested in the country. The slowdown in growth is not only a concern of the world but also the Chinese government as well, given that it is the first time that the nation has missed on its economic growth target in more than two decades (R2015). China’s economic growth has been on the increase over the years with its economic output exceeding $10 trillion in 2014, a feat that only the U.S. had achieved in 2000 (R 2015). The $10.3 trillion output made China the second country in the world to reach such levels, and ostensibly making the second largest economy in the world. Such growth is phenomenal, given that the country had a meager $1.9 trillion in output a decade ago (R 2015).

Over its growth period, investment-intensive activities, thanks to globalization, drove the GDP growth. However, with the slowing capital-intensive activities and sluggish consumption, the GDP has been on a decline. According to Gordon (2016), the country’s consumption of 50 percent of raw materials is slowing the economy, which has a huge effect on commodity-related sectors, particularly on demand for the raw materials.

International Trade

Although China has been a great opponent to globalization, its embrace of the phenomenon has been beneficial to its trade relations with its neighbors and the world at large. One of the most important trading partners for China is the ASEAN (Association of Southeast Asian Nations) countries. Through globalization, China and ASEAN have achieved great growth rates of international trade. To put the matter into perspective, “During the decade from 1991 to 2000, China’sinternational trade grew at an average annual rate of 15 percent. In 2000, China’sexports amounted to the U.S. $249.3 billion, and its imports totaled $206.1 billion” essentially achieving a positive balance of trade (Liu and Luo 2014, p.1).

China’s trade with ASEAN has grown exponentially. Between 1987 and 2000, trade between the two totaled $38.2 billion, growing 55.3% annually (Liu and Luo 2014, p.1). More important was the growth of China’s exports to the ASEAN countries during the same period totaling US$21 billion from $2.3 in 1987 (Liu and Luo 2014, p.1). Globalization, particularly China’s entry into the World Trade Organization (WTO) has opened more doors for the country in international trade. Since its acceptance to the WTO, China’s trade with the developed world, among them the US, has grown exponentially. Between 1986 and 2000, China’s exports to the US increased by 1910% (see Table 1).

Table 1: US imports from ASEAN-5 and China in Billion $. Source Liu and Luo 2014, p.6

Recent data shows an increase in the value of trade between China and the US, as well as with other countries. According to Ortiz-Ospina, Beltekian, and Roser (2019), China’s total value of exports to the rest of the world stood at $1.58 trillion in 2010, even as it exported goods worth $73.1 billion to the U.S. (see fig. 2). Among the major international trade partners for China over the past decade has been Sub-Saharan Africa.   Ortiz-Ospina, Beltekian, and Roser (2019) report that through globalization, trade between China and Sub-Saharan Africa grew from $1 billion in 1992 to $140 billion in 2011.

Fig 2:  Value of goods exported to the US in 2016.  Source Ortiz-Ospina, Beltekian and Roser 2019

Multinational Enterprise and Foreign Direct Investment

China’s large population makes it an attractive market as well as a destination for multinational enterprises. China has great potential as a market for goods and services, especially following the Chinese government’s efforts in creating jobs for locals. According to R (2015), China has been great at creating new jobs: the nation created 13.2 million jobs in 2014, in comparison with 12 million in 2007. Moreover, the nation is fast moving away from its reliance on investment. Many multinationals, including Google, Apple, Samsung, Louis Vuitton, Volkswagen, Coca Cola, and 3M among others have opened shops and offices in China to serve the Chinese market better and reap from a growing middle class. Globalization has been at the center of these moves as the Chinese become more welcoming to foreign cultures, items, and services.

Perhaps more import has been China’s ability to attract FDI. From the 1970s when the country opened its economy and started receiving FDI, many MNCs (Multinational Companies) have heavily invested in the Chinese economy. Park and Vanhonacker (2017) inform that in the 1980s, MNCs such as NEC, Motorola, and Philips were welcomed by the Chinese government. Among the benefits such companies enjoyed were corporate tax and zero duties on capital goods (Park and Vanhonacker 2017). Thanks to globalization and such favorable policies, China remained the world second largest recipient of FDI after the US in 2018 (see figure 3). According to Suokas (2019), quoting a report by the United Nations Conference on Trade and Development, China received US$ 142 billion in FDI in 2018, marking a 3% increase from the previous year.

Fig. 3 FDI inflows, 2017 and 2018. Source: Suokas, 2019

International Finance System and Crisis

The Asian financial crisis awakened China to the ills that come with globalization. The regional financial crisis swept Asia causing depreciation of the Asian currencies against the dollar (see graph 1). The crisis’ effects were felt across the globe and in so doing triggered China’s protectionist tendencies. Among the groups impacted by the Chinese protectionist tendencies are MNCs, whose operations undergo rigorous scrutiny (Park and Vanhonacker 2007). China’s move to scrutinize MNCs was triggered by the indirect effects of the financial turmoil that hit the region. At the time, China lacked enough awareness of the financial and economic risks presented by globalization (Zhongying 1999). The Asian economic crisis and later the 2007-2010 global economic recession have been instrumental in creating China’s awareness of the negative and positive aspects of globalization.

Graph 1: Selected Asian exchange rates against US$ in 1997. Source Park and Vanhonacker 2007

What remains unclear is China’s commitment to globalization and integration of financial systems, which remain in the strong grip of the government’s protectionism. Despite the nation’s economic influence in the world, China’s banks and financial system remain cut out from the rest of the world (Park and Vanhonacker 2007). China has only recently begun gradually easing control on its capital account and foreign exchange markets. However, following the recent effects of the global financial crisis and the instability of the international financial system, the Chinese administration is cautious in joining the global financial system. Additionally, the country’s slowing economic growth has led the administration to be keen on seeing the economy grow at levels that will prevent major layoffs. With this in mind, China is reluctant to join the international financial system, which has the potential of increasing instability and volatility in the country.

Exchange Rate and Regional Economic Integration

China’s open acceptance of globalization and opening of the country to outsiders was a cause for worry for many world economies. The traditionally low wage workers in the country caused fears that their integration into the global economy would be the exportation of deflation. The super-competitive prices of products from China allowed by the low cost of labor will make other products extremely expensive in comparison those from China. However, these fears have been unfounded since the Chinese government has traditionally pegged the renminbi to the dollar exchange rate.

Globalization has been instrumental in China’s move towards regional integration. The republic’s initiative to become part of the global economic system began with its lobbying to become part of the World Trade Organization, which it achieved in 2001. China’s accession to WTO came at a cost for the country, especially in economic and financial policy reforms required before its acceptance to the organization (Park and Vanhonacker 2007). The accession marked China’s first step towards international economic integration.

China has initiated a program that it promises will lead to better regional economic integration. According to Lu (2018), the Belt and Road Initiative (BRI) is China’s program hinged on the benefits of globalization and hopes to initiate deeper economic integration in South of Asia. The initiative, started by China’s premier Xi Jinping, hopes to connect countries in the region. Lu (2018) informs that the “Chinese led trade network enables large, medium and small enterprises to realize their potential and trade more simply and expansively around Asia.” The fact that China is taking such an initiative points to its belief in the benefits of globalization and the realization that globalization is here to stay and it is only prudent that the country embraces it, using it to its advantage.


Globalization is a new and developing phenomenon. Globalization has connected nations and people through trade, travel, and technology. For a long time, China had remained in isolation, closing its doors to foreigners. Over the past decades, however, the country has opened its economy to the world with tremendous results. Foreign direct investment has grown exponentially—China is currently the second highest recipient of FDI. Most important is the effect of FDI into the country. By opening its doors to the rest of the world and accepting globalization, China’s GDP has grown exponentially, propelling the country to the second position in economic might. Although sections of China’s economy remain locked to the rest of the world, globalization is actively changing this, as the country looks more to international financial systems and regional integration.



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Lu, H. 2018, A Changing Nation: The Effects of Globalization on China, RMS International

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Ortiz-Ospina, E., Beltekian, D., and Roser, M. 2019, “Trade and Globalization,” Our World in Data

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