P2 Section A (Globalisation) Flashcards
What is globalisation
Globalisation is a process by which national economies and societies have become increasingly integrated due to the global network of trade, communication, transport and immigration
What are the dimensions of globalisation
dimensions of globalisation are capital, labour, products and services and then information
What is flow of capital in globalisation
flow of capital in globalisation is the sharing of money with the deregulation of world financial markets and it can come in forms like FDI, aid and remittances
What are the biggest flows of capital
The biggest flows of capital are remittances, the biggest of which are referred to as the rivers of gold such as from USA to Mexico and UK to Romania
What is flow of labour in globalisation
flow of labour in globalisation is when people move around the world for labour allowed by efficient transport but can be restricted by immigration policies
What is the largest inter-regional flow of labour
The largest inter-regional flow of labour is between southern and western Asia such as 5 million migrating from India, Pakistan and Bangladesh to Gulf States like Qatar and UAE
What is flow of products and services in globalisation
flow of products and services in globalisation is movement of products that has been facilitated by reduced trading costs like tariffs and time and also movement of services which are facilitated by advancing technology allowing servicing of customers worldwide
Where is largest flow of products and services
largest flow of products and services is in and out of USA like with Russia, China and Western Europe
What is flow of information in globalisation
Flow of information in globalisation is transfers of cultures, language, design and business management governed by the flows of people and allowed by digitalisation
What is biggest flow of information
Biggest flow of information is between USA and Western Europe
What is global marketing
Global marketing is the process of promoting, advertising and selling products or services like Coca-Cola having a single campaign on a global scale which has created economies of scale
What is containerisation
Containerisation was the 1960 standardisation of container dimensions by the International Organisation of Standardisation
What are the effects of containerisation
Effects of containerisation are decreased expense of international trade and speeding up of trade but it also led to automated ports so loss of jobs and decline in ports like Liverpool as they couldn’t store bigger ships and containers
How many containers are made in China
97% of containers are made in China
What are economies of scale
economies of scale are savings made as a result of large-scale production, through buying in bulk and division of labour through rationalisation of operations
What is BRIC
BRIC is the group of Brazil, Russia, India and China whose economies have increased rapidly since 1990s
What is protectionism
Protectionism is a policy to impose restrictions on trade with other countries which is done to protect home-based industries from foreign competition
What is a tariff
A tariff is a tax placed on imported goods with the intention of making them more expensive to consumers so they buy the cheaper home-based goods instead
What is the bottom-up process of projects
The bottom-up process of projects is where locals are consulted and supported in making decisions to undertake a development that will meet their needs
What is the top-down process of projects
The top-down process of projects is where a central authority like the government will make a decision to undertake a development without consultation of locals who it’ll affect
What is a bilateral agreement
A bilateral agreement is an agreement on trade that is negotiated between two countries or two groups of countries
What is a multilateral agreement
A multilateral agreement is an agreement on trade negotiated between more than two countries or groups of countries at the same time
What is a conglomerate
A conglomerate is a collection of companies which may be involved in different business activities but all report to one parent company like most TNCs
What are customs unions
Customs unions are a trade bloc that allows free trade with no barriers between members but imposes external tariffs to countries outside the bloc
How has transport became easier for globalisation
transport has became easier for globalisation by increasing aircraft size, containerisation, high speed railways and computerised logistical systems
How has security changed due to globalisation
Security has changed due to globalisation as terrorism and smuggling has increased costs and increased delays but it ensures shipment security for the business
How does Renaults management allow for quick production
Renaults management allows for quick production as they sub-assemble the car parts from different countries and then build the vehicle is France which relies on remote management of production and distribution lines
What is Organisation of Petroleum Exporting Countries (OPEC)
OPEC is a trade union with countries in middle-east, South America and Africa for oil
What are global advantages of trading entities
Advantages of trading entities are improved global peace and security, increasing trade and co-operation and helping develop economies and standard of living
What are regional advantages of trading entities
Regional advantages of trading entities are allowing people to move between countries more easily and allowing support to remote regions or those with declining industry like EU Regional Fund helping regions like southern Italy and western Ireland
What are disadvantages of trading entities
Disadvantages of trading entities are loss of financial controls to a central authority such as a bank, and certain economic sectors damaged by sharing resources like UK sharing traditional fishing grounds with other EU nations like Spain and France
How did containerisation improve the UK
containerisation improved the UK as Felixstowe handles 2 million containers and in 2012 it was the 7th largest container port in EU
How is containerisation bad
Containerisation is bad as oil tankers use bunker fuel which contains 2000x more sulphur than in a cars diesel fuel
What is NAFTA
NAFTA is the North American Free Trade Agreement between Canada, USA and Mexico and will account for $1.2 trillion in trade
What does world trade organisation do
WTO reduces global injustice and inequalities through trade liberalisation and it removes protectionist policies used by some governments
What is a TNC
A TNC is a company with headquarters in one country, owns factories in one/more countries and sells products globally to make a profit
What is the International Monetary Fund
International Monetary Fund is an organisation of 189 countries working to raise global monetary cooperation, facilitate international trade, and promote sustainable economic growth
What is World Bank
World Bank is a financial institution which provides loans to developing countries for capital programs and its official goal is the reduction of poverty
How is IMF funded
IMF is funded by 190 member countries
How does IMF support development
IMF supports development by providing loans to struggling economies and prevents global crises
How does IMF go against development
IMF goes against development by imposing cuts on education and welfare spending and also only electing European director and also in Asian financial crisis of 1997, IMF told countries to pursue higher interest wages to reduce budget deficit but this caused a serious recession and unemployment
How does world bank support development
World bank supports development by funding over 12,000 development projects via loans and grants to countries with less than $865 GDP per capita and through off-grid power solutions to over 1 million homes in Ethiopia
How has the world bank’s funding not worked
World bank’s funding has not worked as between 1975 and 2000, 66 countries have been funded and 20 were worse and half haven’t improved at all
How was world bank funding in Niger poor
World bank funding in Niger was poor as they received $637 million between 1965 and 1995 yet its GDP per capita fell more than 50% whereas Singapore received 1/7th of the aid and its GDP per capita increased more than 6% every year in that same period
How does world trade organisation support development
world trade organisation support development as they implement measures to boost trading opportunities like 2006 trade for aid initiative which involved UNECA, African development bank and UNDP to help countries trade
How does world trade organisation go against development
world trade organisation goes against development by encouraging free trade which allows inputs to be made from countries with no environmental considerations, it is criticised for being undemocratic by benefiting the rich and also allows EU and US to have high tariffs on agricultural products which hurts developing country farmers
How does unequal flow of labour create inequality
unequal flow of labour creates inequality as less developed countries suffer brain drain as skilled people leave to move to HICs which reinforces existing inequality between countries
How does unequal flow of labour create injustice
unequal flow of labour creates injustice as migrant workers are made to work in dangerous conditions for little wages like in Qatar where several thousand migrants died building infrastructure for 2022 World Cup
How does unequal flow of capital create inequality
unequal flow of capital creates inequality as foreign aid can cause dependency which gives governments little incentives to improve their own country and also FDI can force out local businesses
How does unequal flow of capital create conflict
unequal flow of capital creates conflict as aid can find its way to armed groups and help fund conflict and also FDI can cause conflict between foreign investors and local people
How does unequal flow of ideas create inequality
unequal flow of ideas create inequality as neo-liberalism has spread globally which tends to concentrate wealth in hands of few like large wealthy business in developed areas
How does unequal flow of ideas create injustice
unequal flow of ideas creates injustice as governments and TNCs may argue free trade and privatisation are best way to help development which means justification of poor working conditions and environmental degradation in less developed countries
How does unequal flow of products affect a country
unequal flow of products affects a country as HICs can afford it but LICs can’t and repressive governments of LDCs have used weapons sold to them by developed countries to stop protests
How does unequal flow of culture affect a country
unequal flow of culture affects a country as countries will experience increased diversity but country they’re migrating from will experience decrease and also some new cultures will be discriminated like Jews in Bensham seen as taking over
How does US have most influence in World Bank
US has most influence in World Bank as they have 17.25% shareholding and World Bank aims to tailor investments to meet investor preferences meaning US has higher power and allowing greater control of developing projects
How does OPEC have comparative advantage
OPEC has comparative advantage as they influence oil markets by keeping prices and productions controlled and excluding entrants to the market like Russia and Latin America so the five original countries can claim higher profits from oil they exported
What markets do HICs dominate
HICs dominate automotive, steel and iron and agricultural markets
What markets do emerging economies dominate
Emerging economies dominate consumer technology like China making up 1/3rd and and middle-eastern emerging economies dominate oil industry
What market do LICs dominate
LICs dominate clothing and textiles market but China is worlds biggest exported of textiles and clothing
What do HICs import most
HICs import most manufactured products
What do LICs import most
LICs import most medical supplies - like Chad and Georgia and Uzbekistan
What do emerging economies import most
Emerging economies import most fuel and minerals due to rapid industrialisation like in Brazil China and India
What is outsourcing
Outsourcing is when companies hire other companies to do essential tasks like call centres and advertising as it’s cheaper and done in LICs due to low labour costs
What is offshoring
Offshoring is when a company relocates processes abroad to save money from lower taxes, lower prices of materials and lower labour costs
What are embargoes
Embargoes are prohibitions of commerce and trade with a country - usually in practice for political reasons
What are subsidies
Subsidies are when a government provides unfair financial assistance to its companies to produce or export goods at artificially low prices.
What is comparative advantage
Comparative advantage is when a country who specialises in production of one type of goods can produce it efficiently and at the lowest cost
How has China had economic influence on Africa
China has had economic influence on Africa by investing $41 billion in FDI between 2001 and 2018, with 30% of China FDI in Africa channelled into infrastructure
What is bad about China’s economic influence in Africa
Bad about China’s economic influence in Africa is the fact sending construction workers means local workforce isn’t trained
What is Grand Ethiopian Renaissance Dam
Grand Ethiopian Renaissance Dam is a gravity dam on The Blue Nile River in Ethiopia
How has the GERD created conflict
GERD has created conflict as Sudan and Egypt are concerned it’ll cause severe water shortages downstream
What are the advantages of GERD
Advantages of GERD are when completed, will double the nation’s electricity output, capture 90% of sediment to protect canals and also reduce rate of recurrent floods by climate change
What are the disadvantages of GERD
Disadvantages of GERD are it has destroyed millions of acres of agricultural land to build and water levels have lowered in the Nile
How is China influencing GERD project
China is influencing GERD project by contracting Chinese corporation for $40 million to help finalise GERD on schedule
How did Deputy Prime Minister of Ethiopia say China was better than the US
Deputy Prime Minister of Ethiopia said China was better than the US as they don’t say “do this do that, there are no preconditions”
What are differential treatments
differential treatments are agreements in place by WTO to allow least developed countries to bypass developed countries trading barriers so they’ve got greater market access
What are problems with special and differential treatment agreement
problems with special and differential treatment agreement are that preferential trading may lead to undermining of HIC industry as LDCs have cheaper imports and also some countries like previously Mexico benefited more as a member of NAFTA
Economic impacts of varied access to global market
Economic impacts of varied access to global market are it is hard for countries with poor market access to establish new industries as tariffs make their products uncompetitive
Social impacts of differential access to global market
Social impacts of differential access to global market are people in country’s with good market access will have better wages so more disposable income to reinvest a
How has fairtrade foundation helped LICs in globalisation
fairtrade foundation has helped LICs in globalisation by making sure small-scale farmers receive good trading conditions so they can compete with competitive prices
