Globalisation: 1.6 - Shopping In The Dark Flashcards
TNCs are important in spreading globalisation: Profit focused mindset
TNCs are only focused on profit, so they’ll move operations offshore (e.g to China) where labour is cheap. Apple’s main supplier of components, Foxconn, has massive factories in China
Locals gain employment which leads to increasing affluence
TNCs are not important in spreading globalisation: Government policies
Government policies can restrict what can be sold, through trade blocs or tariffs. E.g EU banned selling military equipment and technology to China (overturned in 2004)
EU also limited imports from China as many EU companies were going bankrupt
TNCs are important in spreading globalisation: Outsourcing
TNCs often outsource to another company to avoid wasting money on something another company is already doing e.g Apple outsourced their OLED screens from Samsung
This results in a global production network that TNCs manage
TNCs are not important in spreading globalisation: Global production networks
Global production networks are risky, as poor management can result in an economic loss and damaged image
e.g Rana Plaza factory collapsed in 2013, killing 1,000 people. It was owned by Primark