Second Cold War (part 1): The History of Globalisation

In the early 20th Century, some historians like Niall Ferguson would regard that as the first age of globalisation. Certainly there was not aeroplanes, internet and satellites, but the British Empire was strong enough to have great steam ships and the All Red Line. The foundation of the British Empire was trade. It was trade that motivated the British to go to India and ended up governing the country. It was trade that motivated the British to colonise the City of Hong Kong.

Before the Chinese government in 1842 cased control of Hong Kong Island, the British was a major trade partner of China, importing tea to the United Kingdom, and it ran a trade deficit with China at that time. Then they started to export Opium from British India to China, albeit the trade was not legal by Chinese law. Chinese wanted to crack down this trade, which ended up with a war by the British against the Chinese, known as the Opium War, as the British tried to protect British interest in China trade. This illustrates how globalisation actually was carried out more than a hundred years ago at the height of the Victorian British Empire. British were consuming tea from China, silk from India, sugar from Jamaica, just to name a few.

The first age of globalisation was ended with the first world war (WWI, 1914-1918), when the Austro-Hungary Archduke Franz Ferdinand was murdered in Sarajevo sparked a chain-reaction all over Europe, ended up with British declared war against Germany. But international trade returned after the war. But the brief prosperity in the post-WWI decade and return of trade was ended with the tragic Great Depression. The Great Depression increased protectionism among countries, and the German’s Weimar Republic effectively went bankrupt as the huge debt balances after losing WWI worsened public finances and hyperinflation caused by printing money to finance government debt. These events eventually led to the rise of Adolf Hitler, and Second World War.

Even though the Allies won the Second World War (WWII, 1937-1945*), at the end of WWII, the Soviet and the United States became power rivals for the next five decades, which was known as the Cold War. In the history of the last century, the globalisation at the start of the century was stopped by two wars, the Great Depression, and the cold war. The force of globalisation did not return until the last decade of the last century.

PART II

PART III

PART IV

* I took the start date of WWII as 1937, which was the start of WWII Asian fighting.

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About Zarathustra

Zarathustra: Founder and Managing Editor of Also sprach Analyst. Once an analyst, now an investor and entrepreneur. Based in Hong Kong, but Londoner at heart.