Unit 4 Power, Places and Networks Flashcards
What is globalisation and what types of globalisation are there? How has it changed through time?
Globalisation: ways in which people and places are more connected now than they used to be
Economic: Growth of TNC’s accelerating cross border trade, ICT supporting complex divisions of labour and building an international economy, online shopping through companies such as amazon.
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Social: International immigration, leading to cross border families and multi-ethnic cities, education and health (not universal), peoples connections through technology.
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Cultural: ‘successful’ western traits dominating certain territories, e.g. Americanisation. Hybridising of old local cultures. Accelerated circulation of ideas and information.
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Political: Growth of trade blocs: reduced Tariffs and restrictions allow market growth like TNC merging. Global concerns and global disaster response. Global support by World Bank, UN, WTO, etc.
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In the past globalisation was achieved through
Trade - The movement of native materials to non-native areas
Colonialism - The claiming of land by more powerful nations taking nations materials, though strengthening connections
Cooperation - Post WW1, multi-governmental organisations such as the UN have existed
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Now globalisation occurs through
Lengthening of connections across the world
Deepening of connections between different people
Faster speed of connections through travel and internet
What indicators of globalisations are there? Pros and cons?
of TNC’s - “business activity”
Economical: Trade, FDI, International trade restrictions.
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Political: # of embassies, UN peace missions participated in
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Social: Internet use, TV ownership, Imports and exports of books
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Pros:
Comprehensive Coverage: economic, political, and social globalization.
Annual updates allow showing trends.
Global Comparison: Covers a wide range of countries.
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Cons:
Some indicators use older data.
Limited Regional Focus
Emphasizes measurable factors, potentially missing cultural and qualitative aspects.
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A.T. Kearney Global Cities Index
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New York, London, Paris, Tokyo among highest ranked global hubs for commerce.
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Museums - “cultural experience”
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Foreign embassies - “political engagement”
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Pros:
Focuses on cities, acknowledging the urban role in globalization.
Timely and Current
Wide Indicator Range
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Cons:
Excludes rural areas and overlooks national-level globalization impacts.
Tends to favour larger cities.
Some indicators rely on perceptions.
What are global superpowers? Examples? (China & USA case study)
Originally used to describe the ability of the USA, USSR and the British Empire to project power and influence anywhere on Earth to become a dominant force.
Results of Superpowers:
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Diffusion of EU languages, religions, laws, customs, arts and sports globally through colonialism.
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Dominating many world affairs. USA by neo-colonial strategies.
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Smart power through a mixture of soft and hard.
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USA
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The United States, with a population of 330 million, controls 40% of global personal wealth and hosts a quarter of the world’s 500 largest companies (as of 2015).
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Its political clout extends globally through control of key international institutions, like the World Bank, where every president has been American.
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American culture, often termed “Americanization,” has shaped global trends in food, fashion, and media.
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The U.S. combines overt military power and covert intelligence, intervening in numerous states, and accounts for over half of all international arms sales.
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Prior to 1978, China was economically isolated, impoverished, and impacted by famine under communist rule.
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In 1978, Deng Xiaoping’s “Open Door” policy transformed China, allowing it to engage with globalization while maintaining one-party rule.
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Now the world’s largest economy, China has lifted 400 million people from poverty, with foreign direct investment projected to grow by over $1 trillion from 2015 to 2025.
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However, challenges remain: its average income per capita is a third of the U.S. level, economic growth is slowing, and it faces an aging population.
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China’s authoritarian government limits its soft power, yet its 2.3 million-strong military enables substantial hard power influence globally.
Explain the G8 and G20 and discuss its pros and cons.
It included the US, UK, Canada, France, Germany, Italy, Japan, and later Russia (who was suspended in 2014).
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It’s known for coordinating rapid responses to crises, like supporting Japan’s economy after the 2011 tsunami.
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However, the G8 became less influential as it excluded emerging powers like China, India, and Brazil.
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The G20 was created to include these growing economies along with EU members, creating a broader forum.
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However, the G20’s diversity sometimes complicates consensus and swift action.
Explain the OECD.
Its objectives include environmental protection and addressing issues like aging populations.
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The OECD has played a key role in combating tax evasion by TNCs, establishing stricter rules among 31 member states to reduce tax havens. However, the organization faced criticism for not predicting the 2008 global economic slowdown, highlighting some limitations in its economic forecasting.
Explain the OPEC group.
OPEC once controlled 65% of global petroleum production (1979), though this fell to 36% by 2007, reducing its influence.
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Despite this, oil revenue has enabled OPEC members to diversify their economies and gain economic and political power, especially in the 1970s-80s.
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Western countries’ reliance on Middle Eastern oil has driven energy conservation and alternative energy efforts, underscoring the need for stable relations and political stability in the region.
What global lending institutions are there?
The World Bank
Founded in 1944, provides financial and technical support to developing countries to reduce poverty.
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Comprising the International Bank for Reconstruction and Development (IBRD) and the International Development Association (IDA), it initially focused on post-war European reconstruction but shifted to development projects in poorer nations in the late 1960s.
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Through the 1980s, the World Bank implemented structural adjustment policies (SAPs) to address Third World debt but faced criticism for these free-market reforms, which some argue harmed local economies and living standards.
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Critics also highlight the Bank’s Western-centric governance, focus on GDP over quality of life, and possibly increased poverty while being detrimental to the environment, health and cultural diversity. Some say it is used to promote western interests.
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The International Monetary Fund
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Established in 1944, is an organization that monitors the global financial system, focusing on exchange rates and balance of payments.
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With 186 member countries, the IMF provides a funding pool for nations facing payment imbalances, offering temporary loans to stabilize their economies.
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In response to the 2008 financial crisis, the IMF increased its resources significantly, enabling it to better support member states.
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However, it faces criticism for promoting austerity measures (cutting of government spending) in SAPs which mean national assets often are sold to western corporations, and supporting authoritarian regimes that align with Western interests, often prioritizing economic stability over democratic values and human rights.
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New Development Bank
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established in 2014 by the BRICS collective, aims to support public and private projects through various financial instruments, including loans and guarantees.
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Headquartered in Shanghai, the NDB focuses on funding infrastructure and sustainable development initiatives, particularly in clean energy.
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Initially, the founding countries contributed $10 billion to the bank, which plans to finance one project from each member country. While new members can join, BRICS nations must retain at least 55% of the bank’s shares.
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The NDB seeks to address the significant funding gap in infrastructure development that exceeds $100 billion annually, complementing the efforts of established multilateral development banks like the World Bank.
What does the term, “networked world” mean?
We live in a networked world where international borders that separate cities are no longer present and physical separation poses no obstacle to information flows between places in the internet age.
Discuss global trade in materials, manufactured goods and services.
While Asia, Europe, and North America remained the primary regions for merchandise trade, emerging economies’ share of exports rose from 33% in 2005 to over 40% by 2015. Additionally, intra-emerging economy trade increased to over 50% of their total trade.
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Merchandise trade was valued at over $16 trillion in 2015, dominated by nations like China, the USA, Germany, and the UK, with the top ten trading nations accounting for more than half of global trade. However, emerging economies only contributed just over one-third of global service trade.
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Factors like China’s economic slowdown, a recession in Brazil, falling commodity prices, and exchange rate changes contributed to the trade decline in 2015.
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Despite these challenges, Asia, particularly “Factory Asia,” had led the recovery after the 2008-09 financial crisis. In 2015, China remained the world’s leading exporter, with exports valued at $2.17 trillion, while the USA was the largest importer.
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Low-income countries (LICs) saw their merchandise export share fall below 1% due to declining energy and mining product prices, while developing countries increased their share in commercial services.
What is aid for trade?
In 2014, over $50 billion was made available for Aid for Trade projects. Asia and Africa remain the
main recipients.
What is the difference between top-down and bottom-up development?
Top-down
Larger in scale
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Government led, or international organisations
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Imposed upon area by outside organisations
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Well funded and quickly responsive
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Lack of local involvement
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E.g. emergency relief.
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Bottom-up
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Small scale
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labour intensive
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Local communities and areas
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Run by locals for locals
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Limited funding
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Involved locals in decisions
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E.g. Earthen dams.
When is aid provided? When is it ineffective?
Can help countries postpone necessary improvements in economic management and mobilization of domestic resources, as well as provide investment in areas that lack access to commercial capital.
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However, aid can also be ineffective and lead to several negative consequences.
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It may create dependency, discouraging self-reliance and sustainable economic practices.
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Food aid can inadvertently depress agricultural prices, worsening rural poverty and increasing reliance on imports, which may lead to future food insecurity.
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The unpredictability of aid, often influenced by the political agendas of donor countries, can disrupt development programs.
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Furthermore, aid may involve the transfer of inappropriate technologies or funding for environmentally harmful projects.
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Emergency aid addresses immediate crises but does not tackle long-term development challenges.
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Additionally, tied aid—where funds are contingent on purchasing goods from the donor country—can limit economic efficiency.
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Corruption can further hinder aid effectiveness by preventing resources from reaching those in need.
What is development aid?
The largest donors are the USA and Japan, each contributing less than 0.25% of their GNI, while France and the UK donate under 0.5%.
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In contrast, Scandinavian countries like Norway, Denmark, and Sweden lead in aid relative to their GNI.
What are loans?
Official Development Assistance (ODA) encourages the efficient use of borrowed funds, as loans require repayment, minimizing the financial burden on donor governments.
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Despite the OECD’s target of 0.7% of GNI for ODA, only a few donors have met this goal. Sub-Saharan Africa receives about 35% of ODA, with Afghanistan and the Democratic Republic of the Congo as significant recipients
What is debt relief?
Sub-Saharan Africa has the highest number of heavily indebted countries, with debt increasing from $3 billion in 1962 to about $235 billion today.
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Prominent debtors include Nigeria, Côte d’Ivoire, and Sudan. High borrowing in the 1970s and 1980s, prompted by Western lenders, led to economic challenges.
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Since 1988, the Paris Club has facilitated debt relief initiatives, while the World Bank and International Development Agency have increased concessional lending significantly. The IMF also introduced a soft loan facility contingent on economic reforms.
