Impact of the technological revolution on International trade and the emerging new challenges in the year 2020

We are in the stage of a technological revolution that is affecting every sphere of our life, the way we live, the way in which we interact with each other and the way in which we work. These things are transforming in such a way that humankind has not experienced it ever before, new technologies are coming so rapidly in the market that it becomes obsolete before even reaching to the whole market.

Humankind doesn’t exactly know how this technological evolution will unfold itself but it is very clear that this technological evolution will have a very comprehensive and uniform effect on all sectors of the international trade. It will affect transportation, communication, manufacturing, and most importantly research and development.

Humankind in its technological evolution used steam, water and coal to mechanize their production for the first time and felt very proud of itself. Then we started using an electric engine for the mass production of goods. Till now we were completely dependent on ourselves for the operation of those big machines and it had no memory or processor of itself. Now humans started to work upon the electrical and electronics evolution of the machines (self-processing power of machines). But still, machines were not able to work with the efficiency of the humans and the biggest problem in machines was it repeats the same mistake until corrected by human intervention.  

Impact of the technological revolution on International trade and the emerging new challenges in the year 2020

Now humankind is taking this technological evolution to the next level where the machines will not need any kind of human intervention and will correct their mistakes by their own. Till now machines were not biologically connected to the humankind but now they are in interaction with human minds by their own artificial intelligence. So, we can see the evolution of the technological advancement in which first there was physical interaction then digital and now its biological interaction.

There are basically three reasons to say that the technological advancement has started effecting the world trade (global trade) in them the first one is the velocity or (speed) the technology has increased the velocity of everything related to world trade there was a time when it took a year to reach America before construction of Suez canal it took lots of physical and economical strain on businessmen and ultimately effecting the cost of the goods. The second factor affecting trade is scope the scope and chances which technology has given to humankind is ultimate now we can see that how artificial intelligence is finding jobs for us. We are getting every day a new app which works on artificial intelligence it has the power to know our behaviour, likes and dislikes more than our family member. Now a company based in the USA need not send their representatives to a small village in India to take their review about their products. The third factor is system impact or (generating facility) now see the impact of technology in world trade that most of the companies in the USA are making their customer service centres in India, Bengaluru because they get cheap employees here. This creates employment in India and decreases the cost of service in the USA now see the effect of it in the global market. Indians are now able to spend more money in the market and now they will buy those luxury item imported in India by the USA. so, it is very clear how money is rotating at a global level with the help of technology. With the help of technology, MNC’s are outsourcing their services from all over the world.

Impact of the technological revolution on International trade and the emerging new challenges in the year 2020

Artificial intelligence is affecting the whole world trade system and policies Now with the progress in technological advancement computers are becoming more and more powerful and able to process more and more data which is helping companies globally to invent new, more reliable and cheap products. Companies are using the technology even for knowing the cultural fabrication of their customers.

Industries are introducing new technologies by replacing human labour which is creating a very different type of value chain in the global market. Now global industries are working on more reliability on machines instead of humans because they are more efficient and reliable in comparison to humans. A very good example of this is Ola cabs, without any infrastructure and without buying a single cab they have created a multi-billion company.

Major factors affecting the global market is people’s access to mobile and internet due to which markets have become more and more transparent. This has led to companies to improve their quality and cost-effectiveness due to the access to technology the whole world becomes a market for them.

A new trend has come in the market with the help of technology which is the combination of demand and supply which has disrupted the current industry trend(structure). Technology is giving more efficient trading and business facility with the help of smart intelligent machines. Not only that it has also broken the barriers for traders to connect to their customers and customers to connect to their sellers. Outsourcing of goods and services is becoming a major business in the global market.

There are four major effects of technology on international trade first is on expectations of the customers, second is an enhancement in products, third is collaboration innovation and fourth is on the form of organisation. Consumers and businesses are the major players in the global economy. They give the direction to the market behaviour and the whole concept is solely based upon the concept of satisfying the customers. Services and physical products can now be made according to the will of the consumers with the help of the technology which ultimately leads to an increase in their value. Till now the evolution of technology has increased the demand for the products which was considered to be a luxury item earlier. This has happened because of the globalisation of technology which has made the products very cheap.

Impact of the technological revolution on International trade and the emerging new challenges in the year 2020

In the coming times, technological involvement will do great miracles it will lead to long term benefits it will increase the benefits and productivity in the global markets. The main sectors which will get the most benefits from the technological innovation are transportation and communication sectors the operational cost will drop rapidly, global supply chains will become more effective, and the cost of trade will diminish, all of which will open new markets and drive economic growth.

At the same time, the revolution will be led to greater inequality, in the labour market, it will create a lot of unemployment. As robots and automated machines will replace labour across the whole economy it may lead to inequality in the proper distribution of money in the whole economy. On other the hand, it is also possible that the displacement of labour by the automated machines will lead to a more safe and awarded job in the whole economy. Which will ultimately lead to an increase in productivity.

Impact of the technological revolution on International trade and the emerging new challenges in the year 2020

Increase in the inequality between different classes is the main societal concern in technological advancement. The biggest beneficiary of the technological advancement in global trade is the intellectual class and physical capital holder and this will lead to the competition between those dependent on capital versus labour. Technology is, therefore, one of the main reasons why incomes have stagnated, or even decreased, for a majority of the population in high-income countries: the demand for highly skilled workers has increased while the demand for workers with less education and lower skills has decreased.

Discontent can also be fuelled by the pervasiveness of digital technologies and the dynamics of social media. More than 30 per cent of the global population now uses social media platforms to connect, learn, and share information. In an ideal world, these interactions would provide an opportunity for cross-cultural understanding and cohesion. However, they can also create and propagate unrealistic expectations as to what constitutes success for an individual or a group, as well as offer opportunities for extreme ideas and ideologies to spread.