World Economy

1- During the last twenty years, the international economy has experienced a basic change.
Improvements in the telephone and other communications have had important economic
effects on world markets. Faster methods of transports from one place to another have made
the world seem smaller to the businessmen. As a result, the world no longer consists of a
number of separate economies under the control of different nations. Instead, the nations
have been integrated into a single economy, and the integration is becoming more and more
complete every year. For the first time in history, we can truly speak of a world economy.
2- The most dramatic example of this integration was the oil crisis of 1973 and 1974. It came as
great surprise to the public in industrial nations to discover that they depended so heavily on
imported oil. However, the best evidence for the growing integration is the rapid expansion
in the volume of world trade. It went up by 8% a year during the decade from 1960 to 1970.
As a result, some imported products have become as common as domestic goods. Some of
them are so common that the consumer no longer realizes they foreign.
3- Production has also become international. Some large corporations have stepped across
national borders and established subsidiaries in several different countries. As an example,
US companies are building automobiles in Japan, west Germany, Britain and Canada. The
automobile is then finished inside the US using the imported parts.
4- Labor, too, is much more mobile than in the past. Both skilled and unskilled workers can
now move easily from one country to another. In Europe, for example, there are large
numbers of Turkish workers employed in the German economy. Doctors, lawyers and other
professionals are also finding it easier to work in foreign countries. The labor market has
become international.
5- As world economic integration has grown, more and more nations have become
economically powerful. Only a decade ago, most decisions on international economic policy
were made as a result of conferences among the ten major industrial countries. Today, the
developing countries are much more aware of their strength.

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I) Reading Comprehension Questions:

1) What is the meaning of « world economy »?

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2) What makes the economies of the countries around the world more integrated?
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3) Focus on paragraphs 2,3,4 and 5. Then, List the effects of world economy?
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4) There are two manifestations of this economic integration. What are they?
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5) How can world economy be beneficial to the developing countries?

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6) Pick out synonyms of the following words.

- Supplementary firms =
- Set =
- Proof =
- Brought from abroad =

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