Globalisation case studies Flashcards
What is an example of a country that was helped by the IMF and the World Bank, and when?
Bolivia, in 1999
What did Bolivia have to do to receive financial aid from The World Bank and the International Development Bank
- Water privatisation was a requirement for the Bolivian government in order to retain ongoing state loans
- The World Bank pressurised the government to give up its control of municipal water supply
Who did Bolivia transfer control of water supplies to?
- To the company Aguas del Tunari
- It’s a multinational group owned by International Water, of which the San Francisco-based company Bechtel was the main shareholder
What happened as a result of Bechtel’s water investment and management in Bolivia?
- When the company took over local wells and informal pumps as well as the public system infrastructure, many consumers were priced out of the market and were unable to pay the increased rates
What was Bechtel’s revenue in 2000 and what does this compare to?
- Bechtel made an annual revenue of over $14 Billion in 2000
- Bolivia’s national budget at the time was only $2.7 Billion
How did Bolivians react to being priced out of water?
- Riots eventually broke out in Cochabamba
- Violence shook the confidence of the local government and international investors
- Bechtel was forced out, resulting in chaos in water delivery but also seriously affecting foreign investment in the country
Why did the water privatisation project in Bolivia fail?
- The government, World Bank and IMF decided to implement their private-market-led policies despite previous failed attempts at structural adjustment in Bolivia
- Bolivia is a small, poor economy so the government likey felt pressured to side with the powerful TNCs
- Foregin investors never sought the input of indigenous people or considered the impact of their policies on them.
What are the goals of the European Union?
- Promotes peace and well-being of citizens
- Offer freedom, security and justice without internal borders
- Sustainable development based on balanced economic growth and price stability
- Enhance economic, social and terrotiral cohesion and solidarity among EU countries
What countries is ASEAN made up of?
Brunei
Cambodia
Indonesia
Laos
Malaysia
Myanmar
Philippines
Singapore
Thailand
Vietnam
What is the goal of ASEAN?
- To facilitate common interests through regional cooperation whilst simultaneously recognising each country’s cultural, social and economic identity
When did McDonalds first open in the world, and in the UK?
- First restaurant opened in the US in 1955
- First UK branch opened in 1974
How many McDonalds restaurants are there now?
- 30,000 restaurants in around 120 countries
- There are 1200 restaurants in the UK
How many customers do McDonalds get?
- 50 million customers a day in the world
- 2 million customers a day in the UK
Where does McDonald’s revenue come from?
- 32% comes from the US
- 40% comes from Europe
- 23% comes from Asia/Pacific, Middle East and Africa
Give some examples of McDonalds glocalisation:
- In Muslim countries, pork has been removed from the menu
- In locations like Antigua in Guatemala, McDonald’s has changed its store frontage to blend in with local architecture
- The types of products are changed to local tastes e.g McRice in Indonesia
What are the benefits of outsourcing to India and manufacturing to China?
Investment in infrastructure
Reduction in poverty
Increase in urban incomes
Better education and training
Describe investment in infrastructure due to outsourcing to India:
- Economical development means that India can afford to expand roads and public transport, such as Mumbai monorail
Describe investment in infrastructure due to shift of manufacturing to China:
- China built 11,000km of new motorways in 2015
- Infrastructure expansion such as Three Gorges HEP dam has occurred
- 82 airports built since 2000
Describe reduction in poverty due to shift of manufacturing to China:
- Over 600million people in China have escaped poverty
- Extreme poverty levels went from 88% in 1981 to only 0.7% in 2018
Describe better education and training due to shift of manufacturing to China:
- Chinese companies are increasingly developing their own products
- TNCs invest in training and skill developments to improve workforce productivity
Describe the reduction in poverty due to outsourcing to India:
- Large English speaking population makes India a popular location for marketing call centres to find workers, providing more and more people with a stable income
What are the costs of outsourcing to India and shifting manufacturing to China?
Loss of productive farmland
An increase in unplanned settlements
Pollution and health problems
Land degradation
Over exploitation of resources and resource pressure
Loss of biodiversity
Describe an increase in unplanned settlements due to outsourcing to India:
- Widening gap between rich and the poor, with 86.8 million people still living in extreme poverty
- This means many can’t afford planned housing
- Many migrants come to the city with little savings and can’t afford formal housing, leading to the growth of shanty towns and slums
Describe loss of biodiversity due to outsourcing to India:
- Housing and industry development is resulting in loss of green spaces
- Biodiversity within most cities has decreased as concrete covers most land, resulting in the loss of habitats