General Globalisation stuff

Question 1

Globalisation definition -

Answer 1

The growing economic dependence of countries worldwide through increasing variety and volume of cross-border transactions.

Question 2

20th century transport and trade which has allowed globalisation to flow - Containerisation

Answer 2

Containerisation - Malcom Mclean in 1956 and which goods are transported in containers meaning they can be easily transferred on and off ships and this introduction has allowed improved speed efficiency of globalisation as products are not individually placed on ships for transport.

Question 3

21th century transport and trade which has allowed globalisation to flow - The digital economy

Answer 3

Made in 1995 and was aided by the invention of the internet and this reshapes businesses via the computing networks and the scale of goods to be made via the internet. This change has allowed implications for patterns and processes of the global economy. ICT and global communications have paved the way businesses and goods flourish universally.

Question 4

Other factors in the growth of globalisation are?

Answer 4

International politics and economic organisations

Question 5

World bank - international

Answer 5

• Supplies loans to rebuild economies
• reduce inequalities
• aims to reduce the % of people living on less than $1.25 a day to no more than 3%
• Lends money on a global scale

Question 6

WTO - International

Answer 6

• Reduce tariffs/trade barriers and result in untaxed trade this can be seen influential in such areas which have taken this on board like China, however it failed to stop the UK and USA from allowing trade to believed on a level playing field

Question 7

IMF - international

Answer 7

International monetary fund - Help balance economic payments when they are suffering from economic difficulties. Gives loans which allow them to pay debts

Question 8

National attitudes of managing globalisation -

Answer 8

Market liberalisation and privatisation

P - moving ownership of a business from a public to private sector

ML - reduce rules that restrict economic activities from companies, done to allow motivation of companies and reduce the effects of inhibited globalisation.

Question 9

Privatisation -

Answer 9

Deregulation from Margret Thatcher after the general election. Attract FDI and allow more firms to enter the market. As these increases competition in the market.

Question 10

Market liberalisation -

Answer 10

Reduce rules restricting economic activity, governments do this as businesses will become inefficient and not active in a global market, for example the deregulation of London in 1986 paved the way for London to be considered as a global leader, opening these markets can influence more trade and doing so in the UK that what can be seen in Canary Wharf in London.

Question 11

Trade blocs -

Answer 11

Intergovernmental agreement where barriers to world trade are reduced or eliminated in total. (deregulation)

Question 12

Advantages of trade blocs -

Answer 12

National firms (businesses) can bind together to form large TNC’s these can forms larger domestic businesses to compete globally like Vodaphone merged with Germany’s Mannesmann to become the world’s largest telecommunications company.

Bigger markets at no extra taxes - For example Tesco expanded to the whole population of the EU from the UK resulting in a range of over 500 million customers to enter the market.

Question 13

Disadvantages of trade blocs -

Answer 13

A trade bloc is likely to lose sovereignty and they are also very interdependent on other countries and if if a certain country cannot supply enough in a TNC or to be competitive enough in a global market there will be consequences for the attempts of regeneration.

Question 14

Special economic zones -

Answer 14

Allows international trade where certain regions reduce tariffs needed for imports and exports of materials for example China have now set up 7 to this current day.

Question 15

Measurements of globalisation -

Answer 15

KOF globalisation index - measures to the extent to which countries are socially, economically and politically engaged with other countries.

AT Kearney - Produces a global city index of measuring business activity, cultural experiences and political engagement.

Question 16

Role of TNC’s -

Answer 16

• Link together different international markets
• significant investments into other countries
• Rather than directly investing in offshoring (moving different parts of the production to other countries to reduce the costs of labour or other costs.)
  Many engage into outsourcing where TNC’s contact other companies to manufacture goods they need rather than do it themselves this improves the networks of supply chains.

Question 17

Outsourcing does bring risks -

Answer 17

Natural hazards such as the 2011 tectonic hazards in Japan, there is no control over other manufactures for example 2013 UK supermarkets were shocked to find horsemeat in their stock.

Question 18

Glocalisation -

Answer 18

Changing of local products to meet the culture of others increasing the likelihood of sales. E.G in food sales where Chinese chocolate is made sweeter and the Indian Mcspicy

Question 19

Different approaches of TNC’s in the use of glocalisation -

Answer 19

McDonalds established over 35,000 restaurants in 119 countries in India there were problems of menu choices as Hindus and Sikhs are traditionally vegetarian and also Muslims who do not eat pork so with the introduction of the McVeggie and Mcspicy Paneer this has massively benefited their diets and resulted from a westernised culture.

Question 19

Why do some regions choose to remain switched off?

Answer 19

Social, political and economic reasons in the Sahel region and North Korea.

Question 20

Why do North Korea actually choose to remain switched off?

Answer 20

Divided from South Korea in 1948 and has been isolated for nearly 40 years, communist dictatorship of their current leader Kim Jong Um, aim to keep sovereignty of the whole country.

Question 21

Why does the Sahel region remained switched off?

Answer 21

Sahel region

The Sahel region (a group of countries including Mali and Niger) in North Africa is a ‘switched off’ region because of physical and environmental reasons.
This region of the world is dry with severe water scarcity. There are regular droughts and famines. Because of this, conditions for agriculture are bad and the Sahel produces very few crops for export.
The Sahel region includes landlocked countries that struggle to export goods without access to their own ports. This means they are switched off from global trade flows.

Question 22

Global shift -

Answer 22

Describes the international relocation of industrial activity to different areas globally

Question 23

Global shift of China -

Answer 23

With a population of over 1.3 billion people, China has become the ‘workshop of the world’ as TNCs have moved their manufacturing here.
TNCs can keep their costs very low as wages are cheap in China.
This has increased China’s GDP because their exports have increased significantly. Between 1978-2012 China’s economy grew at an average rate of 9.4% per year

Question 24

Global shift in India -

Answer 24

Global shift of services to India

With a large educated and English-speaking population, India has seen a growth in services because many TNCs outsource their call centres and other services here.
E.g. In 2003, BT opened two call centres in India (one in Bangalore, one in Delhi). They employed 2,200 people. BT benefit from lower labour costs because wages are cheaper in India.
India has benefitted significantly from the global shift in services.
The outsourcing industry in India adds an estimated $150 billion to the economy

Question 25

Negative impacts from the global shift on the environment -

Answer 25

As a result of the global shift, there have been negative impacts on both people and the environment.

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People in developing world

There has been a material shift in jobs to the developing world.
Rather than working in agriculture, people in countries like India, China and Bangladesh can add more value and earn higher wages than they would otherwise.
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Land use in developing world

In the developing world, the global shift has caused the loss of productive land.
It was predicted in 2014 that 40% of China’s farmland was degraded because of pollution and increased building.
This means that fertile land that could have been used for farming is instead used for manufacturing or the quality of the land has reduced because of pollution.
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Land use in developing world cont.

In the developing world, the global shift has caused the growth of unplanned settlements.
As more people move to cities to take the jobs in manufacturing, squatter settlements or slums grow. These unplanned settlements often have a low quality of life and cause problems for the government of that area.
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Pollution in developing world

In the developing world, global shift has caused environmental and resource pressure.
Resources are needed to power factories and manufacturing plants. These factories also produce pollution that damages the environment.
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Pollution in China

In 2013, China experienced severe air pollution problems with residents of Beijing advised to stay indoors. The air pollution levels were over 20x higher than the World Health Organisation recommended maximum levels for a 24-hour period.
China also has serious water pollution problems. In 2015, 85% of the water in Shanghai’s major rivers was undrinkable.

Question 26

India is therefore a winner -