# data[].attributes.body
Globalisation has increased the trade in skills as well as goods

# data[].attributes.attachment_link.readable_text
Football transfers were catapulted off the sports pages into the global media spotlight this year when Paris St-Germain broke - or rather smashed - the world record fee to snatch Brazilian star Neymar from Barcelona this summer.

But that very prominent deal was just the very visible peak of a huge industry, namely the international trade in football players, which is becoming more and more of a global business.

Latest data from Fifa, the sport's governing body, show there have been 15,291 international transfers so far in 2017, with total spending on players hitting a record $6bn (£4.58bn).

International transfers are ones where a player moves from one country to another, as opposed to domestic transfers which take place between two clubs in the same country.

That record figure - which is unlikely to change by the end of the year as player transfer windows in the biggest European leagues are not due to open again until January 2018 - is a 25% increase on the $4.8bn spent in 2016.

"There are two driving factors behind the soaring spending," says Harry Philp, a football finance expert at London-based Portland Advisers.

"The first is the emergence of China and the huge transfer fees that they are prepared to pay, and the second is the fees English Premier League clubs can spend thanks to their ever more lucrative TV deals. These factors are driving up the value of the global market."

Indeed, Chinese clubs spent a whopping $451m on football players last year, an increase of 168%. That made them the fifth biggest spenders in the world after England - where clubs splashed out $1.37bn on global stars - Germany, Italy, and Spain.

"The rapid nature of this [Chinese spending] growth is unprecedented," observes Fifa. "One of the key objectives fuelling China's transfer drive is to raise the overall standard of football in the country so as to assist the national team in reaching the World Cup for only the second time in their history, following their debut in 2002."

There has been a huge increase in investment in Chinese football in recent years, kicked off by President Xi Jinping's plans to turn China into a great footballing nation, one that one day might host and ultimately win a World Cup.

Chinese clubs are investing almost exclusively on players coming from Europe, but not necessarily Europeans.

Many of those making a playing name for themselves in East Asia are South Americans, and Fifa's data shows Brazilians and Argentines are the most transferred nationalities globally.

"Irrespective of how their national team is doing, Brazil continues with its production line of young players for sale around the world," observes Mr Philp.

"It is a socio-economic phenomenon, with football still being a way out of the favelas and a means for a youngster to financially support his extended family."

Not only does Brazil produce talented players for export, with their stars now plying their trade in 118 countries, but their total financial accumulated sales value came to $594m in 2016, the most for any playing nation.

Most of the transfers discussed in the global media involve large transfer fees, but in reality, only a small percentage of all worldwide transfers involve the payment of a fee.

The majority of deals are players who have become free agents finding a new club.

"Transfers out of contract remain the most popular type of international transfer," says Fifa. They are even more common for older players - in 2016, more than 90% of the international "transfers" of players older than 32 were out of contract.

Loan deals account for another proportion of transfers, and there have been accusations that clubs such as Chelsea, and to a less extent Manchester City, are scouring the globe for top young talent to stockpile.

"They are then put out on loan to see how they develop," says Mr Philp. " A small proportion will make it into to the first team, and the rest of the pool of talent can be sold on, usually at profit. This provides revenues for the clubs to then buy one global top star player, and also to assist in compliance with financial fair play.

"These clubs are trading players, almost running what I would call 'asset-management businesses'."

In such a fractured landscape it all means that transactions such as Neymar's, where money changes hands, are actually in the minority.

"It is at the top level where the fees are being paid," says Mr Philp. "A club like Paris St Germain is spending so much money that they are accounting for a meaningful percentage of annual global transfer revenues."

He says that after splashing out 220m euros on Neymar, PSG is set to pay another 180m euros or so next year, when it makes permanent its current loan signing of Kylian Mbappe from Monaco. There have been suggestions that the Paris club has opted for a loan deal this year to get around financial fair play rules.

The financial fair play rules have been introduced by European football's governing body Uefa to ensure that clubs only spend cash on big-name star signings from revenues that they have created, rather than through borrowing or handouts from rich owners.

"Financial fair play is meant to control the transfer madness," says Mr Philp. "But if revenues are going up, whether through TV monies in the Premier League, or at PSG via Qatari investment - however that is being structured - then transfer fees and player wages will continue to climb.

"Financial fair play is still alive and kicking, but with revenues soaring then there is nothing to stop the global transfer trade going the same way."

With January transfer trading windows opening in the biggest five European leagues including England - as well as in China and Brazil - it means players, clubs and agents will already be gearing up for a frenzied period of global trading that could see spending leap even further ahead during 2018.

# data[].attributes.attachment_link.title
Brazil's Neymar and the $6bn global trade in footballers

# data[].attributes.attachment_link.description
Football transfers were catapulted off the sports pages into the global media spotlight this year when Paris St-Germain broke - or rather smashed - the world record fee to snatch Brazilian star Neymar from Barcelona this summer.

# data[].attributes.headline
The increasing scale and pace of economic migration

# data[].attributes.subject
The increasing scale and pace of economic migration

# data[].attributes.headline
The politics and economics of globalisation

# data[].attributes.subject
The politics and economics of globalisation

# data[].attributes.body
News report from November 2016

# data[].attributes.attachment_link.readable_text
Egypt has devalued its currency by 48% and announced that it will be allowed to float - measures that meet a key demand by the International Monetary Fund in order to secure a $12bn (£9.6bn) loan over three years to overhaul its ailing economy.

The devaluation pegged the Egyptian pound at 13 to the dollar, up from nearly nine on the official market. A central bank auction of dollars will be held later on Thursday, allowing supply and demand to determine the value of the pound for the first time in decades.

The devaluation was virtually certain to cause a steep hike in prices, piling pressure on Abdel Fatah al-Sisi's government to avoid a popular backlash against its handling of the economy.

Sisi has repeatedly urged Egyptians in recent weeks to rally behind him as he grapples with the country's worst economic crisis in decades, arguing that there was no way out of the economic crisis unless Egyptians "endure and be patient."

Sisi, a general turned president elected in 2014, has pledged to do all he can to protect Egypt's poor from the inflationary fallout that is certain to come with economic reforms. Last week he said the military would distribute a one-off package of basic food items such as sugar and rice at half price among poor Egyptians.

Also on Thursday, the central bank raised by three percentage points its two key overnight interest rates.

The bank said the measures were part of the government's reform programme and designed to "completely end" the unofficial currency market. The measures, it said, would "empower the Egyptian economy to face the present challenges, unleash its potential and achieve the hoped-for growth".

"The floatation is an excellent, overdue step that, thank God, we took it," the Egyptian business tycoon Naguib Sawiris wrote on Twitter. "We must all help to make this step a success."

The much heralded central bank decision followed a sharp and sudden decline this week in the value of the dollar on the unofficial market, plunging from an all-time high of 18.25 pounds to about 13 to the US currency.

Abdel Fatah al-Sisi has repeatedly urged Egyptians in recent weeks to rally behind him. Photograph: AFP/Getty Images

The IMF's executive board has yet to ratify the $12bn loan provisionally agreed between Egypt and the lender of last resort in August.

Egypt is also expected to reduce or lift altogether state subsidies on fuel to meet IMF conditions. It has already reduced subsidies on household electricity and hiked the price of sugar by 40% for ration card holders.

Seeking to calm nerves at a time of economic tumult, the central bank said it guarantees deposits in all currencies and that individuals and companies would face no restrictions in depositing and withdrawing foreign currency. Regulations governing importers of non-essential goods would remain in place, it said.

Banks would be allowed to operate until 9pm and open on weekends to buy and sell foreign currency, it added. Banks in Egypt are normally open to the public until 5pm and close on the Friday-Saturday weekend.

The developments on Thursday came just two days after the association of the chambers of commerce inflicted a blow to the unofficial currency market, announcing a two-week freeze in dealing with black market currency traders and curtailing the imports of non-essential goods for three months.

On Tuesday, the supreme investment council, a newly formed body led by Sisi, approved a package of measures designed to spur the economy, including a three-year freeze on taxing capital gains on stocks and an unspecified increase in the number of state-owned companies to be partially privatised.

# data[].attributes.attachment_link.title
Egypt devalues currency by 48% to meet IMF demands for $12bn loan

# data[].attributes.attachment_link.description
Egypt has devalued its currency by 48% and announced that it will be allowed to float - measures that meet a key demand by the International Monetary Fund in order to secure a $12bn (£9.6bn) loan over three years to overhaul its ailing economy.

# data[].attributes.body
Video about how TNCs organise their supply chain

# data[].attributes.body
Exam question, mark scheme and model answer

# data[].attributes.headline
ICT & environmental impacts of globalisation

# data[].attributes.subject
ICT & environmental impacts of globalisation

# data[].attributes.body
Exam question, mark scheme and model answer

# data[].attributes.body
Short video

# data[].attributes.body
Global trends 2016

# data[].attributes.attachment_link.description
Starbucks records its "most profitable year" and says it is focusing on China to secure growth "for decades to come".

# data[].attributes.headline
Ten companies that control everything you buy

# data[].attributes.subject
Ten companies that control everything you buy

# data[].attributes.body
Newspaper article

# data[].attributes.attachment_link.title
These 10 companies control everything you buy

# data[].attributes.attachment_link.description
Oxfam created a mind-boggling infographic that shows how interconnected consumer brands really are

# data[].attributes.body
Podcast on how containers revolutionished trade

# data[].attributes.attachment_link.title
BBC World Service - 50 Things That Made the Modern Economy, Shipping Container

# data[].attributes.attachment_link.description
The boom in global trade was caused by a simple steel box

# data[].attributes.headline
The steel box that transformed global trade

# data[].attributes.subject
The steel box that transformed global trade

# data[].attributes.body
Companion to the podcast

# data[].attributes.attachment_link.readable_text
Perhaps the defining feature of the global economy is precisely that it is global.

Toys from China, copper from Chile, T-shirts from Bangladesh, wine from New Zealand, coffee from Ethiopia, and tomatoes from Spain.

Like it or not, globalisation is a fundamental feature of the modern economy.

In the early 1960s, world trade in merchandise was less than 20% of world economic output, or gross domestic product (GDP).

Now, it is around 50% but not everyone is happy about it.

There is probably no other issue where the anxieties of ordinary people are so in conflict with the near-unanimous approval of economists.

Arguments over trade tend to frame globalisation as a policy - maybe even an ideology - fuelled by acronymic trade deals like TRIPS and TTIP.

But perhaps the biggest enabler of globalisation has not been a free trade agreement, but a simple invention: the shipping container.

It is just a corrugated steel box, 8ft (2.4m) wide, 8ft 6in (2.6m) high, and 40ft (12m) long but its impact has been huge.

Find out more

BBC World Service's 50 Things That Made the Modern Economy programme highlights the inventions, ideas and innovations that helped create the global economy.

You can find more information about its sources and listen online or download the programme podcast.

Consider how a typical trade journey looked before its invention.

In 1954, an unremarkable cargo ship, the SS Warrior, carried merchandise from New York to Bremerhaven in Germany.

It held just over 5,000 tonnes of cargo - including food, household goods, letters and vehicles - which were carried as 194,582 separate items in 1,156 different shipments.

Just keeping track of the consignments as they moved around the dockside warehouses was a nightmare.

But the real challenge was physically loading such ships.

Loading by hand

Longshoremen would pile the cargo onto a wooden pallet on the dock.

The pallet would be hoisted in a sling and deposited in the hold.

More longshoremen carted each item into a snug corner of the ship, poking the merchandise with steel hooks until it settled into place against the curves and bulkheads of the hold, skilfully packed so that it would not shift on the high seas.

There were cranes and forklifts but much of the merchandise, from bags of sugar heavier than a man to metal bars the weight of a small car, was shifted with muscle power.

In a large port, someone would be killed every few weeks.

In 1950, New York averaged half a dozen serious incidents every day, and its port was safer than many.

Researchers studying the SS Warrior's trip to Bremerhaven concluded the ship had taken ten days to load and unload, as much time as it had spent crossing the Atlantic.

In today's money, the cargo cost around $420 (£335) a tonne to move.

Given typical delays in sorting and distributing the cargo by land, the whole journey might take three months.

Sixty years ago, then, shipping goods internationally was costly, chancy, and immensely time-consuming.

Surely there had to be a better way?

Vested interests

Indeed there was: put all the cargo into big standard boxes, and move those.

But inventing the box was the easy bit - the shipping container had already been tried in various forms for decades.

The real challenge was overcoming the social obstacles.

To begin with, the trucking companies, shipping companies, and ports could not agree on a standard size.

Some wanted large containers while others wanted smaller versions; perhaps because they specialised in heavy goods or trucked on narrow mountain roads.

Then there were the powerful dockworkers' unions, who resisted the idea.

Yes the containers would make the job of loading ships safer but it would also mean fewer jobs.

US regulators also preferred the status quo.

The sector was tightly bound with red tape, with separate sets of regulations determining how much that shipping and trucking companies could charge.

Why not simply let companies charge whatever the market would bear - or even allow shipping and trucking companies to merge, and put together an integrated service?

Perhaps the bureaucrats too were simply keen to preserve their jobs.

Such bold ideas would have left them with less to do.

Spotting an opportunity

The man who navigated this maze of hazards, and who can fairly be described as the inventor of the modern shipping container system, was called Malcom McLean.

McLean did not know anything about shipping but he was a trucking entrepreneur.

He knew plenty about trucks, plenty about playing the system, and all there was to know about saving money.

As Marc Levinson explains in his book, The Box, McLean not only saw the potential of a shipping container that would fit neatly onto a flat bed truck, he also had the skills and the risk-taking attitude needed to make it happen.

First, McLean cheekily exploited a legal loophole to gain control of both a shipping company and a trucking company.

Then, when dockers went on strike, he used the idle time to refit old ships to new container specifications.

He repeatedly plunged into debt.

He took on "fat cat" incumbents in Puerto Rico, revitalising the island's economy by slashing shipping rates to the United States.

He cannily encouraged New York's Port Authority to make the New Jersey side of the harbour a centre for container shipping.

But probably the most striking coup took place in the late 1960s, when Malcom McLean sold the idea of container shipping to perhaps the world's most powerful customer: the US Military.

Impetus of war

Faced with an unholy logistical nightmare in trying to ship equipment to Vietnam, the military turned to McLean's container ships.

Containers work much better when they are part of an integrated logistical system, and the US military was perfectly placed to implement that.

Even better, McLean realised that on the way back from Vietnam, his empty container ships could collect payloads from the world's fastest growing economy, Japan.

And so trans-Pacific trading began in earnest.

A modern shipping port would be unrecognisable to a hardworking longshoreman of the 1950s.

Even a modest container ship might carry 20 times as much cargo as the SS Warrior did, yet disgorge its cargo in hours rather than days.

Gigantic cranes weighing 1,000 tonnes apiece lock onto containers which themselves weigh upwards of 30 tonnes, and swing them up and over on to a waiting transporter.

The colossal ballet of engineering is choreographed by computers, which track every container as it moves through a global logistical system.

The refrigerated containers are put in a hull section with power and temperature monitors.

The heavier containers are placed at the bottom to keep the ship's centre of gravity low.

The entire process is scheduled to keep the ship balanced.

And after the crane has released one container onto a waiting transporter, it will grasp another before swinging back over the ship, which is being simultaneously emptied and refilled.

Zero-cost transport?

Not everywhere enjoys the benefits of the containerisation revolution.

Many ports in poorer countries still look like New York in the 1950s.

Sub-Saharan Africa, in particular, remains largely cut off from the world economy because of poor infrastructure.

But for an ever-growing number of destinations, goods can now be shipped reliably, swiftly and cheaply.

Rather than the $420 (£335) that a customer would have paid to get the SS Warrior to ship a tonne of goods across the Atlantic in 1954, you might now pay less than $50 (£39).

Indeed, economists who study international trade often assume that transport costs are zero.

It keeps the mathematics simpler, they say, and thanks to the shipping container, it is nearly true.

Tim Harford writes the Financial Times's Undercover Economist column. The 50 Things That Made the Modern Economy programme was broadcast on the BBC World Service. You can find more information about its sources and listen online or download the programme podcast.

More on this story

Around the BBC

# data[].attributes.attachment_link.title
The simple steel box that transformed global trade

# data[].attributes.attachment_link.description
Perhaps the defining feature of the global economy is precisely that it is global. Toys from China, copper from Chile, T-shirts from Bangladesh, wine from New Zealand, coffee from Ethiopia, and tomatoes from Spain. Like it or not, globalisation is a fundamental feature of the modern economy.

# data[].attributes.body
What you need to know about globalisation

# data[].attributes.body
Advantages and disadvantages of the process

# data[].attributes.body
How the world looks 100 years apart

# data[].attributes.body
What is the link between ICT and globalisation?

# data[].attributes.body
Who is connected and who misses out

# data[].attributes.body
A switched on city state

# data[].attributes.body
The history of McDonalds

# data[].attributes.body
McDonalds - the fries that bind us

# data[].attributes.body
Case studies of the impact of people movements

# data[].attributes.body
Globalisation across TNCs

# data[].attributes.body
A guide a few of the most common ones

# data[].attributes.body
How political isolation works against being switched on

# data[].attributes.attachment_link.title
How North Korea's hushed-up economy is hindering its development

# data[].attributes.attachment_link.description
China has rejected a North Korean attempt to join its new Asian Infrastructure Investment Bank (AIIB), according to a recent report, a decision which could have a significant effect on Pyongyang. Masahiro Kawai, a professor of public policy at the University of Tokyo told Emerging Markets that North Korea had failed to "disclose sufficient information" relating to industry, public finances, and its tax base.

# data[].attributes.body
What issues do they face?

# data[].attributes.body
How China has transformed

# data[].attributes.attachment_link.readable_text
China has undergone a huge transformation over the last 70 years, from a large rural country to one of the biggest economies in the world.
The change has been rapid; from the Great Leap Forward in 1958 which saw widespread famine to more capitalist tendencies in recent years, the landscape, both physically and financially in China has changed beyond recognition.

# data[].attributes.attachment_link.description
China has undergone a huge transformation over the last 70 years, from a large rural country to one of the biggest economies in the world. The change has been rapid; from the Great Leap Forward in 1958 which saw widespread famine to more capitalist tendencies in recent years, the landscape, both physically and financially in China has changed beyond recognition.

# data[].attributes.body
AS Paper

# data[].attributes.body
Culture clash

# data[].attributes.attachment_link.readable_text
"We completely agree that the cultural and artistic heritage and the Italian historical town centres have to be protected and guaranteed, as well as the traditions and the historical small shops, but we cannot accept discriminatory regulations that damage the freedom of private initiative without being advantageous to anyone," McDonald's told the BBC in a statement.

# data[].attributes.attachment_link.title
McDonald's sues Florence for 18m euros for blocking restaurant

# data[].attributes.attachment_link.description
"We completely agree that the cultural and artistic heritage and the Italian historical town centres have to be protected and guaranteed, as well as the traditions and the historical small shops, but we cannot accept discriminatory regulations that damage the freedom of private initiative without being advantageous to anyone," McDonald's told the BBC in a statement.

# data[].attributes.body
Short animation

# data[].attributes.body
Test yourself

# data[].attributes.body
How is wealth spread and how does globalisation impact it?

# data[].attributes.attachment_link.title
Global Wealth Inequality  -  What you never knew you never knew (See description for 2017 updates)

# data[].attributes.body
How the project works

# data[].attributes.attachment_link.title
Incredible Edible: Todmorden's local food revolution

# data[].attributes.body
Give yourself feedback

# data[].attributes.body
What is development?

# data[].attributes.body
TED talk by Michael Green

# data[].attributes.attachment_link.title
Michael Green: What the Social Progress Index can reveal about your country

# data[].attributes.attachment_link.description
The term Gross Domestic Product is often talked about as if it were "handed down from god on tablets of stone." But this concept was invented by an economist in the 1930s. We need a more effective measurement tool to match 21st century needs, says Michael Green: the Social Progress Index.

# data[].attributes.body
Test yourself

# data[].attributes.body
How the pile keeps growing

# data[].attributes.body
How Laos is affected by development

# data[].attributes.body
Exam style questions

# data[].attributes.body
Podcast By Jim O'Neil exploring the + and - impacts of increased global trade.

# data[].attributes.attachment_link.readable_text
Jim O'Neill asks if new challenges mean an end to the era of globalisation?

Jim O'Neill asks if new challenges mean an end to the era of globalisation. As chairman of Goldman Sachs Asset Management, Lord O'Neill was seen as one of the high priests of globalisation - coining the term BRICs to describe the economic rise of Brazil, Russia, India and China. Now, many see the UK's vote to leave the EU, alongside the election of Donald Trump as indications that the world is turning away from globalisation. A stalling in the increase in global trade is seen as another significant indicator. Lord O'Neill believes that globalisation can be a positive force, lifting hundreds of millions of people out of poverty. But can this economic engine take care of those left behind by rapid, wrenching change?
Producer: Helen Grady.

# data[].attributes.attachment_link.title
BBC Radio 4 - The New World, Fixing Globalisation

# data[].attributes.attachment_link.description
Jim O'Neill asks if new challenges mean an end to the era of globalisation? Jim O'Neill asks if new challenges mean an end to the era of globalisation. As chairman of Goldman Sachs Asset Management, Lord O'Neill was seen as one of the high priests of globalisation - coining the term BRICs to describe the economic rise of Brazil, Russia, India and China.

# data[].attributes.body
Short animation questioning globalisation

# data[].attributes.body
Advice and guidance

# data[].attributes.body
Short animation

# data[].attributes.attachment_link.title
Ecological footprint: Do we fit on our planet?

# data[].attributes.body
How Nissan operates sustainably in USA

# data[].attributes.attachment_link.title
Local Sourcing of Materials for the Nissan LEAF | AutoMotoTV

# data[].attributes.body
More feedback