Globalisation/global systems Flashcards
Define globalisation
Complex to define but A process by which national economies and cultures have become increasingly interconnected due to flows of labour, capital, products, information and services.
What are capital flows
Remittances, repatriation of wages from periphery to core, core regions pay to IMF/world bank who give low interest loans to periphery, mobile/investment banking, FDI usually in LDEs or EEs. Disaster relief. Stocks and links to information (trends to analyze before investing). Remit 40% of Tajikistan
FDI fell by 40% with covid
Deregulation of financial systems eg2008 shock
What are labour flows. How did Covid impact? Iphone labour treatment
Freer movement of people. Migration (in) or emigration (out).
Prior to Covid, quarter of a billion economic migrants (seeking higher pay). Maybe refugees. Though, millions returned due to Covid slowing it temporarily. Skilled or not? Blue collar to white collar industries? Ease of visas etc. for example knowledge of the working conditions at Foxconn producing iPhones.
What are product flows
Merchandise sold internationally. Associated with low production costs of manufacturing in LDEs. Eg Dyson offshoring to Asia. Branding has to be managed. Locate near demand for reduced lag times.
Service flows
By 2040, India supposed to be 2nd largest economy due to call centers outsourcing. Global marketing whereby one common theme is used worldwide. Glocalization can occur where it’s tailored for regional needs (including product). Growing service and quaternary/tertiary sectors. Follow labour. High vs low skill.
Information flows
Telecoms./fiber optics. Social media. Time-space convergence where much more information can be transferred instantly. On-demand services such as Netflix. Cheap and reliable. Working from home.
Give one of most globalized countries based on KOF index 2020
Switzerland
Give example of China being highly globalized but also not
Is globalized in terms of trade. Some of It’s citizens don’t participate in global social media - use national WeChat. Great Firewall etc.
How has developed transport technology helped globalisation? How many containers on some ships?
Containerisation allows large amounts of goods to be transferred in uniform intermodal containers. But, 2021 Suez Canal block highlights issues (critique). The Jumbo Jet creates in the 1960s has now made travel far faster and easier for tourists eg ryanair. From months to hours. Up to 24k containers per ship
How can the time-space convergence effect link with changing places?
Far pleases may not feel as far. Can travel easier and share much more information. But, only for those with monetary access in HICS. Visas are hard to get too due to red tape.
Financial systems impacting globalisation
2007-9 global crisis. America sneezes world catches cold. Faster international transfers. IMF funnels money from core to periphery. In return, periphery have to be free market and open to outside investment (critique).
Trade agreements
WTO (26k pages) or USMCA. EU now a multi governmental organization with its own currency and some shared legislation.
How have management systems impacted globalisation?
Vertical disintegration (break down production into several parts).TNCs have global production networks, EOS and outsourcing branches or offshoring. China joined WTO in early 2000s and GDP skyrocketed as a result after Mao was replaced
Describe 2 security features of globalisation
Use of X rays in airports
Focus on cybersecurity.
Cambridge analytica using facebook data forphyscographic targeting of posts
Define interdependence
What happens in one place increasingly has impacts on others
Economic interdependence
Finance/shocks. Countries need flows of labour for their economy. Need remittances/support monetarily (links politically).
Eg some sectors of germanys economy rely on Eastern Europeans labour
Political interdependence
Tariffs/quotas. Need countries to work together and get lots of support for key ideas eg COP21. Help with political unrest. Golden Arches theory (Friedman) states 2 counties with similar TNCs won’t wage war on one another. Though, Ukraine vs Russia proven this wrong.
Social interdependence
Diaspora (large amounts of migrants located in another area). TV programmed from other countries.
Environmental interdependence
Global commons. Countries must work cooperatively towards shared goals otherwise change is irreversible. However, some HICS still purchasing hardwoods from LICs.
Argument against interdependence
Unequal flows of capital, labour, products, services and info can promote stability, growth and development but can cause inequalities, conflicts and injustices.
When talking about patterns of production and consumption, what should you say?
-TNCs sweatshops. Locate in NEEs. Locate near demand. Locate in developed areas that were deindustrialised.
-Demand for LICs/NEEs from HICS.
-NEEs growing affluence.
What is an emerging economy (MINT)
-Major in demand economy such as oil in Nigeria with profits to reinvest
-Well educated population that can produce high tech goods
-Low cost location with FDI incentives such as similar culture or language
-Close to an affluent market
Capital flows: What do the IMF do and evaluate this
-Monitors economic and financial development of countries. 189 members. Lends money/offers bailouts to states in financial difficulty to maintain stability eg Greece 2010, large bailout.
-USA/Europe HDEs exert too much influence over institution supposed to be politically neutral.
-Delayed crisis responses
Capital flows: Who are the world bank and evaluate them.
-Provides advice, development loans and debt relief on a global scale to reduce poverty and promote development. 65 US billion in 2014.
-Can impose strict conditions on loans and grants. Critics call it neo colonialism.
Give issue with unequal flow of people, specifc to Qatar
World Cup Construction used migrants. 1200 died.
Issue for host country with FDI in another
May reduce gov spending/TNC spending here.
Benefits with unequal ideas
Help educate low-income countries to grow or reduce inequality. Deregulation/privatisation/free trade
Where is increasing tech innovation occuring (what type of country)? Benefit to Indian people of call centres.
LICs/EMEs due to FDI.Indian call centre workers enjoy higher QoL than their parents (large difference, short temporal scale).
Issues with unequal technology
Loss of jobs in host countries, workers paid little in relation to profits and can’t afford these in LICs usually.
Benefits of FDI. What % of FDI to EMEs.
Average incomes in Asian Tiger economies soared eg European FDI.
1 billion people escaped absolute poverty defined by UN 1.90 per day
50% FDI to EMEs eg BRIC/MINT.
Benefits of locating in Ireland for TNCs but then evaluate
Lowest business tax rates in Europe of 12.5%. But new global gov rules threaten this.
Why might remittances not occur in long-run. 2022 India remittance value (highest).
Relatives feel less connected to one another or may have moved to the country instead.
$100 bil
Beneficial flows of products such as weapons
Western Europe to Ukraine. But increased tensions with Russia.
Increasing info: How has it helped with healthcare in Nigeria (the single-product economy with Dutch disease)
Successful campaigns for vaccinations against infectious diseases.
Describe China’s silk road/belt initiative: What do they aim to do and what happens if country cannot repay debt?
Invests in foreign countries in Asia/Eurpoe/Africa to develop trade with transport infrastructure or ports (self-interest). If countries cannot repay debts for this, China can gain control over the assets/infrastructure paid for eg Malaysia.
Describe Kenya and relationship with EU and UK
Kenya sell flowers to UK showing interdependence. Producers in Kenya rely on UK as a market and UK consumers rely on Kenya for products they can’t get elsewhere.
Though, this LIC has sturggled to trade wit EU due to impsotion of tariffs on non-member states.
Uganda Mini Case Study:
Has plenty of natural resources (copper and cobalt)
Access to freshwater
English is commonly spoken
Yet, after civil wars, corruption and HIV/AIDS epidemics, its development has been stunted.
Nearly 1/3 of the population) live under the poverty line amongst many other indicators of development (live expectancy, infant mortality, etc.)
Inequalities/injustices:
Describe poverty, fishing in the Lake, main export, geographical position and main export partners
Poverty in Uganda is greatest in its rural areas, particularly the North where the majority of the population are smallholder subsistence farmers in Shambas.
Fishing Lake Victoria is also common practice for those living on its shores. The fishing is unregulated and has become very unsustainable (overfishing). Also new preadtory species Nile Perch reduced economic potential from fishing.
Main export of coffee due to previous British colonialisation. Env exploitation. Over-production in late 90s led to fall in income for farmers. Land-locked
China and India are 2 biggest improters.
Stability/growth/development:
Describe the Village Phone Model 2007
There has been technological change taking place in the rural regions of Uganda. Mobile phone antennae are springing up from the rooves of farm houses.
Given installing telephone wires across these areas would be too expensive. The arrival of new cheap wireless technology has revolutionised how people communicate and how some make their living income.
This is called the ‘Village Phone Model’. People wishing to start a mobile phone business are given loans. This money is used to buy a mobile device (more so smart phones today), a car battery to charge it and a booster antennae that can pick up signal from 25km away. Paid back in months (short temporal for lon-run benefits).
This new accessibility to internet/communications and data has changed the way the economy works in the area making it much more efficient and competitive.
Uganda Trade Bloc East African Community 8 countries
The EAC vision is
To set up a prosperous, stable united East Africa
To provide a platform to widen and deepen Economic, Political, Social and Cultural integration in order to improve the quality of the life of people of East Africa through increased competitiveness, value added production, trade and investments
Free trade between member states
Country in future?
3 issues with unequal power
HICs lead politcal conferences
HICs contribute msot to climate change and waste but LICs impacted most and can’t afford, financially, to deal with it.
LICs supported financially but often under strict conditions and repayment charges with interest.
Information flow stat: How much of world have internet access?
Only 40% of people in the world have access to the internet, so we are set for these flows to become all the more influential.
Censorship of info in China
The Great Firewall – Set up in stages throughout late 1990’s
Banning of websites that the Chinese government did not approve of.
Bandwidth Throttling – intentional slowing of internet speeds when trying to access illegal websites
The Golden Shield – set up in 1998
A system of domestic surveillance
Those caught breaking the law would be subject to fines, arrests and imprisonment. In 2010 Lui Xiabao was imprisoned for 10 years for sharing illegal documents. The UN awarded him the Nobel Peace prize, this was not reported widely in China.
China has been relatively successful in controlling the information that its citizens are exposed to. Yet, they have found a healthy balance between censorship and exposure for trade. For example, Alibaba is a Chinese e-commerce company that connects Chinese exporters with companies all over the world, allowing for ease of trade between the east and west. Wholesale.
NATO security
NATO supports globalization by ensuring collective defense, stabilizing key regions, and addressing global threats like terrorism and cyberattacks, creating a secure environment for global trade and cooperation.
