Globalisation: 1.4 - Jebel Ali

Question 1

Nation states don’t drive globalisation: Tertiary Sector growth

Answer 1

Tertiary sector makes up 49% of GDP for UAE (in 2017)

Has happened largely due to companies, and this is because their main goal is to make a profit

If a country isn’t ideal for a company, they can easily find a more convenient country

Question 2

Nation states drive globalisation: Country cooperation

Answer 2

If nations choose not to be more globalised, companies can’t access the country fully (e.g making UAE citizenships hard to obtain limits the flow of people)

Question 3

Nation states don’t drive globalisation: Special Economic Zones

Answer 3

SEZs are only there to entice TNCs to invest, without the FDI of a large company, a country will struggle to be more globalised and compete with countries that are already benefiting from FDI

The Dubai World Central is a logistics hub twice the size of Hong Kong, but it’s useless without businesses there

Question 4

Nation states drive globalisation: Special Economic Zones

Answer 4

Governments can provide SEZs like the Jebel Ali Free Zone where companies are exempt from corporate tax for 50 years (+ other benefits)

Government can dictate where it wants the FDI of TNCs to go by manipulating where TNCs go

Question 5

Nation states drive globalisation: Subsidies

Answer 5

Countries can subsidise loss-making companies providing a vital service (e.g UAE subsidised energy companies, spending $1.7 billion on petrol subsidies in 2014)

Question 6

Nation states drive globalisation: Infrastructure

Answer 6

Government can build infrastructure that promotes globalisation and triggers cumulative causation (e.g 5 star Ihn Battuta Gate Hotel has its own dedicated Metro Station minutes way from the end of the Jebel Ali Free Zone)

Strengthens the flow of people, and helps increase employment