Unit 4 - Power, Places and Networks

Question 1

What are superpowers?

Answer 1

They are able to influence policy on a worldwide scale, and often in different regions at the same time.

Question 2

Name two global superpowers

Answer 2

USA and China (rising superpower)

Question 3

What is the USA’s economic influence as a superpower?

Answer 3

• The American economy remains the bedrock of the global financial system.
• Over 80% of all financial transactions worldwide are conducted in dollars.
• As long as the world continues to place such faith in America’s currency and overall economic stability, the US economy remains very powerful.

Question 4

What is the USA’s political influence as a superpower?

Answer 4

• Foreign aid helps the US maintain a high political influence globally. In 2013, the US shared out $32.7 billion in financial assistance. Money buys strong political ties from countries in need.

Question 5

What is the USA’s cultural influence as a superpower?

Answer 5

• Americans continue to enjoy a quality of life unmatched by the rest of the world.
• In 2012, American’s spent $370 million on pet costumes.

Question 6

What is the USA’s military influence as a superpower?

Answer 6

• The US accounts for 37% of global military spending and spends more than four times what China, the world’s number 2 spender does on its military.

Question 7

Is China on its way to become a superpower economically?

Answer 7

• Their economy is growing at a rapid rate. But it’s not just the size of the economy that matters it’s about the quality.
• In 2013, the USA’s GDP was $53,042 and just $6,807 in China. This means that little of China’s rapid economic growth is received by Chinese consumers.
• China’s economic growth may be higher but the US economy allows citizens to grow along with it.
• Overtime, China’s economic strength due to its population size will be much bigger than that of the US. Already, even at its present low level of development, China is the main trading partner of many countries around the world and economic power will drive political power and influence. China will, if it wishes, be able to bend many other countries to its will.

Question 8

Is China on its way to become a superpower culturally?

Answer 8

• The Chinese are proud of their historical achievements.
• For instance, during the Song dynasty from the 10th to the 13th century, with major advances in a number of fields like Biology, Mathematics, Hydraulic engineering, architecture etc.

Question 9

Is China on its way to become a superpower through its military?

Answer 9

Although China does have a large military it is smaller and weaker than the US military. While America has 11 aircraft carriers, China only commissioned its first last month.

Question 10

Is China on its way to become a superpower overall?

Answer 10

The forms of power for the Chinese will be economic and cultural.

Question 11

Define globalisation

Answer 11

Globalization is the growing interdependence of countries worldwide through an increasing volume and variety of cross-border transactions in goods and services and of international capital flows, and through the more widespread diffusion of technology.

Question 12

What does the KOF Index measure?

Answer 12

measures the economic, social and political dimensions of globalisation.

Question 13

Distinguish between economic, social and political globalisation.

Answer 13

Economic - flows of trade, FDI, restrictions on trade.

Social - spread of ideas, information, images, people. (internet users, tourism, foreign population etc.)

Political - the degree of political cooperation. measured by a number of embassies, membership of international orgs, number of international treaties signed.

Question 14

What are the powerful organisations?

Answer 14

G7, G20, OECD, OPEC, The World Bank, The IMF

Question 15

What countries are part of the G7?

Answer 15

The United Kingdom, United States, Italy, Germany, France and Japan and Canada.

Question 16

What are the achievements of the G7?

Answer 16

• They have helped maintain global economic stability, especially after the 1073 economic recession.
• They have launched the Heavily Indebted Poor Countries (HIPC) initiative in 1999, which aimed at cancelling the bilateral and multilateral debts of poor countries.

Question 17

Brief history of the G7

Answer 17

• They initially met to discuss looming oil prices.
• Membership is volatile and countries can be suspended at any time.
• Russia was allowed to join the group as the only communist country, which gave birth to the G8. Russia was however expelled in 2014 with its annexation of Crimea.
• The main objectives include discussing issues of global governance, global economy, energy policy, and international security.

Question 18

What are the criticisms of the G7?

Answer 18

• Criticised for coming up with too many problems and not tangible solutions.

Question 19

What is the G20?

Answer 19

An international forum of governors of central banks and governments from the 20 of the world’s leading industrialised and emerging economies.
Throughout the year, representatives from G20 countries gather to discuss financial and socioeconomic issues.

Question 20

Criticisms of the G20

Answer 20

• Many have criticized the G20 as not being transparent, as it does not have an existing charter and most meetings are usually held behind closed doors.
• Other institutions have criticized the G20 as ineffective in combating the global financial crisis of 2008 and questioned its ability to implement economic policies that could ensure global financial stability.
• The under representation of Africa has also been questioned.

Question 21

What are the aims of the OECD?

Answer 21

• It is an international policy that strives to make better policies for better lives.
• They work on establishing evidence based international standards and finding solutions to social, economic and environmental issues.
• They improve economic performance, create jobs fostering strong education and fight international tax evasion.

Question 22

Criticisms of the OECD

Answer 22

• Narrowness of its membership; excludes major market players like China.

Question 23

What is the purpose of OPEC?

Answer 23

to co-ordinate and unify petroleum policies among Member Countries, in order to secure fair and stable prices for petroleum producers; an efficient, economic and regular supply of petroleum to consuming nations; and a fair return on capital to those investing in the industry.

Question 24

Criticisms of OPEC

Answer 24

Came to be viewed as a monopolistic cartel in many circles in the 1970s.
It triggered high inflation and low fuel supplies around the world by imposing oil embargoes in 1973.

Question 25

What is the IMF?

Answer 25

A loaning scheme that gives large loans to countries that are either about to face a crisis or need a way out of one.

Question 26

Criticisms of the IMF

Answer 26

• The countries all contribute money to the IMF, and the country who contributes the most money has the most power when voting on issues. Germany and the US are the largest contributors to this and so the US has 15% of all votes.
• Countries with a lower GDP have less power because they are not financially secure like others.
• Don’t lend to countries that they deem as not worthy e.g. countries with bad human rights.

Question 27

What is the World Bank’s mission?

Answer 27

to ‘fight poverty with passion and professionalism… and to help people help themselves and their environment by providing resources, sharing knowledge and building capacity and forging partnership in private and public sectors’.

Question 28

Criticisms of TWB

Answer 28

• Many scholars have argued that the policies of the WB is detrimental to the dev’t of developing countries. These scholars point out that western economic practices cannot be applied successfully in developing countries.
• It also seems to focus so much on the growth a country’s GDP rather than on the standard of living of its citizens.

Question 29

Why have the tariffs have been imposed by the USA on aluminium and steel imports?

Answer 29

There is no rationale behind imposing the tariffs other than making the US economy their priority

Question 30

What measures have been taken by those affected?

Answer 30

The steel and aluminium production has increased in the US which has also increased the demand for jobs within the factories. This is because less companies are importing steel and aluminium into the USA and so they will use the local, US supplies of steel and aluminium

Question 31

Outline the steel tariffs Trump implemented.

Answer 31

• 25% tax on steel and 10% tax on aluminium
• Imposing this traffic will only impact trade and ultimately will lead to a loss of jobs
  • In beverage cans there is only about 3% worth of steel or aluminium. They are sold for just over $1 in a store. Therefore it is unrealistic to say that there will be a disaster from implementing this tariff.• The first problem is that investors will look elsewhere to see if there is anything they can do to reduce their costs
  • When a tariff regarding tyres was imposed by Obama, the employment rate increased by 2% and so this idea could be imposed on the steel and aluminium tariffs

Question 32

Explain the difference between international aid, bilateral aid and multilateral aid.

Answer 32

International Aid - any form of needed assistance by one country or multilateral institution to another
Bilateral aid - aid given directly from one government to another
Multilateral aid - aid coming from numerous governments and organisations to another

Question 33

What is top down aid?

Answer 33

Large in scale

Carried out by governments, international organisations and “experts”

Imposed upon the area or people by outside organisations

Well funded, quickly respond to disasters

Does not involve local people in decision making

Question 34

What is bottom up aid?

Answer 34

Small in scale

Labour intensive

Run by locals for locals

Limited funding available

Involves locals in the decision making process

Question 35

Why does the IMF lend money?

Answer 35

• Provides regular economic health checks on countries. Surveillance stage.
  
  • Provides technical assistance in training
  • Helps countries in need offering assistance in loans
  • Countries could get themselves in trouble through internal and external issues. Internal issues include: natural disasters.

Question 36

Give examples of the factors that require countries to ask for assistance.

Answer 36

• Employing too many people
  
  • Giving out too many subsidies
  • May want financial support and guidance
  • Cant keep up with their debt

Question 37

The IMF and the World Bank How Do They Differ?

Answer 37

IMF:

• draws its financial resources principally from the quota subscriptions of its member countries
• Assists all countries

World Bank:

• acquires most of its financial resources by borrowing on the international bond market
• Provides to poorer countries

Question 38

What are the benefits of debt relief programmes?

Answer 38

Debt happens at an individual and governmental level.
Heavily indebted countries such as Guyana. Provided them with space and how to plan and use their money.
More modern and efficient healthcare and education system as more money is available.
Improving in the quality of services.
Multicultural debt relief
Uganda’s rural transport has improve through supporting roads. Roads used to transport crops as part of their jobs which produces more income, providing education to their kids, they get jobs, get money…

Question 39

Explain the objectives of the HICP initiative.

Answer 39

• HIPC launched in 1996 by the IMF and the World Bank
  
  • Endorsed by 180 governments
  • Main aim to ensure that no poor country faces a debt burden it cannot manage.
  • Two main objectives:
  • To relieve certain LICs of their unsustainable debt to donors
  • To promote reform and sound policies for growth, human development and poverty reduction

Question 40

Debt relief occurs in two steps:

Answer 40

• At the decision point, the country gets debt service relief after having demonstrated adherence to an IMF programme and progress in developing a national poverty strategy.
  
  • At the completion point the country gets debt stock relief on approval by the World Band and IMF. The country is entitled to at lease 90% debt relief from bilateral and multilateral creditors to make debt levels sustainable.

Question 41

Will Covid have an impact on remittances?

Answer 41

Yes, as people are losing their jobs, the remittances reduce which could greatly impact countries such as Pakistan where 40% of remittances contribute to their GDP.

Question 42

Remittances are a result of…

Answer 42

Remittances are a result of globalisation. Global issues has an impact on a local level.

Question 43

Remittances can…

Answer 43

Remittances can relieve people of poverty

- 40% of GDP in Pakistan is from remittances.

Question 44

Dark side of remittances

Answer 44

Organisations that provide people with the jobs receive the money that the workers earn instead of the whole sum being received by the family.

Question 45

What is human trafficking?

Answer 45

Involves the use of force, fraud or coercion in exchange for labour, services, or commercial sex act.

Question 46

What is an example of small scale trafficking?

Answer 46

forcing children to work in manufacturing companies

Question 47

What is an example of large scale trafficking?

Answer 47

Thailand’s fishing industry - made fishing industry the largest exporter of shrimp. But, behind this was trafficking: Military caught selling Burmese and Cambodian migrants onto fishing boats. They were made to work and were thrown overboard if they fell sick. The fish they caught to feed shrimp to then be caught were sold in Costco, Tesco, Walmart and Carrefour.

Question 48

Types of trafficking and percentage of trafficking they make up

Answer 48

Forced labour exploitation - 68%

Forced prostitution - 22%

State-imposed labour - 10%

Question 49

What are the benefits of counterfeit goods?

Answer 49

• cheap, stylish clothing
• creates jobs
• generated revenues for countries

Question 50

What are the drawbacks of counterfeit goods?

Answer 50

• damage a brand’s reputation

- illegal

Question 51

What’s an example of a flow of counterfeit goods?

Answer 51

A group of Chinese smugglers were arrested trying to bring 300,000 counterfeit Nike shoes to the USA worth around $73 million. - came in containers on ships from China.

Question 52

How much revenue does the Narcotics business generate per annum?

Answer 52

more than $20 trillion

Question 53

Why is the flow of Narcotics dangerous?

Answer 53

Because every year 40,000 people die due to drug overdoses - more car accidents and guns combined.

Question 54

What’s an example of how the flow of Narcotics is possible?

Answer 54

As law enforcement gets stricter, the drug cartels get more creative. Created Narcosub marines - 7 tonnes of cocaine per sub, worth $227 million.

Question 55

Why do people participate in the production of drugs?

Answer 55

People are forced to pick leaves as they don’t have money for an education. Many locals benefit. Earning around $41 USD a day. - directly and indirectly. E.g. in Colombia, without cocaine, there would be absolute poverty.

Question 56

95% of all drugs are transported by….

Answer 56

boats

Question 57

Define TNC

Answer 57

An organisation that operates in a large number of countries.

Question 58

Where are TNC headquarters generally located?

Answer 58

Generally TNC headquarters are in HIC cities with research and development and decision-making concentrated in growth areas of HICs.

Question 59

Where are assembly and production (TNCs) located?

Answer 59

Mainly LICs.
E.g. An American company like Nike invest in a foreign country such as Vietnam. They invest in roads, electricity, gas, water, infrastructure, labour to make it work for them.

Question 60

Define FDI

Answer 60

The investment by a company into the structures, equipment of organisations of a foreign country.
It does not include investment in shares of companies of other countries.

Question 61

Define outsourcing

Answer 61

Hiring people outside a company to perform services and create goods.
JESS uses a cleaning company to do the cleaning for them.
JESS outsourced an IT company in the UK to provide Office 365 for the students.

Question 62

What are the advantages of TNCs?

Answer 62

TNCs can be responsible for the transfer of technology and managerial know-how from developed to developing nations.

TNCs have allowed consumers in developing countries to buy consumer goods that they would never have been able to buy in the past.

TNCs seem to be central to economic growth in today’s world. Foreign Direct investment has helped China overtake the UK and France to become the world’s fourth biggest economy.

Positive multiplier effect usually means that the presence of TNCs in a country improves roads, airports and services.

Question 63

What are the disadvantages of TNCs?

Answer 63

Outsourcing means that TNCs exploit cheap labour. As a result local workers are paid badly.

The products of TNCs are consumed in almost every country on earth. This erodes local diversity and homogenises our tastes and cultures.

Over 90% of TNCs have their headquarters in the developed world. The profits simply go into the pockets of their shareholders – rich, privileged westerners.

TNCs are footloose and may move their operations out of a country at any point – in search of lower wages and cheaper production elsewhere. This creates economic uncertainty within the host country.

Question 64

Examples of TNCs

Answer 64

McDonalds and Starbucks

Question 65

Comparing the global strategy of Starbucks vs McDonalds

Answer 65

• McDonald’s have used glocalization where they adapt to countries worldwide whereas Starbucks have not adapted to countries needs as their menu has not changed.
• McDonalds likes to take raw materials from as close as possible whereas Starbucks uses raw materials from the 6 same regions.

Question 66

Define MGO

Answer 66

MGOs are organizations or countries that come together to form a single entity mostly for trading purposes. Eg.

EU- European Union
USMCA- United States Mexico Canada Agreement

Question 67

Define free trade zone

Answer 67

A duty-free and tax-exempt industrial park created to attract foreign corporations and create industrial jobs

Question 68

State the four general international migration trends that can be identified

Answer 68

1. Migration is becoming more global in that more countries are affected at the same time and the diversity of areas of origin is increasing.
2. Migration is accelerating with the number of movements growing in volume in all major regions.
3. Migration is becoming more differentiated with no one type of movement dominating a country’s flows but instead combinations of permanent settlers, refugees, skilled labour, economic migrants, students, retirees, arranged marriages etc.
4. Migration is increasing among women who are not only moving to join earlier male migrants but are now playing a fuller part in their own right, notably as economic migrants as well as often being dominant in refugee flows.

Question 69

How do MGOs promote global interactions?

Answer 69

MGOs allow state boundaries to be crossed feely in order to facilitate the free movement of goods, services, finance, ideas. Members are encouraged to abolish tariffs and promote the exchange of ideas in areas of security, trade, etc

In that case they promote global interactions since they are encouraging different people to become one.

Question 70

Ways by which MGOS can promote global interactions

Answer 70

• They promote free movement of people between countries. For instance in the EU and ECOWAS people can move freely thereby we can say they are practicing globalization.
• Free trade allows the free movement of goods between member countries. It promotes global interactions because it leads to the development of homogeneous landscape saving brands, banks, etc.
• Some of the MGOs use a common currency, which allows the free flow of goods and services. This common currency unites those countries, such as the Euro using countries, financially.
• Free movement of ideas between members as a result of the Internet. For instance if you are the member of the EU, you cannot be charged for roaming charges if you visit another EU country.

Question 71

Why do MGOs not always lead to global interaction?

Answer 71

Joining groups like the EU means you would be unable to be independent as their currency is even controlled by the EUs central bank.

Foreigners would dominate the countries.

Question 72

How can export-processing zones facilitate global interactions?

Answer 72

• Export processing zones allow countries to have access to goods that they cannot produce on their own at relatively low prices.
• Free zones also help in global interactions because it helps in the transfer of skills from advanced countries to developing countries through the training of workers.
• Free zones help to stabilize a country’s currency against other countries currency. This improves global interactions because the country would be able to trade with another country, like the US, and get a lot of the foreign currency into their country.
• Export processing zones leads to bilateral and multilateral relations between countries, which enable the manufacturing companies to sell their goods to different parts of the world.

Question 73

The export processing zones do not always lead to global interactions because:

Answer 73

The companies do not do not directly interact with the people of the given country with the exception of the workers.

Question 74

Ways in which the government of the US is controlling migration

Answer 74

• Introduction of American green card system to allow for the selection of migrant with required skills to enter America.
• Scholarship packages for needy but brilliant people from developing countries.
• The Mexican Wall
• Army patrol at the American Border
• Random checks.

Question 75

How does the UAE control economic migration flows?

Answer 75

• Everyone has to be employed and have a sponsor
  
  • Everyone has to have the right vaccines to prevent diseases e.g. everyone arriving must have a negative COVID test
  • Can only be granted to live here if you have something that benefits the economy e.g. job, property
  • Males have to have a job when 18 and females have to get employed by 21. - strictly patrolling their flows of people.
  • Harder for women to get jobs than men. They need special work visas and permission from husband.
  • If employed by a company - the company will apply and sponsor your residence visa while you are in the UAE
  • University students are sponsored by their universities in the UAE under the institution’s name.
    The validity of stay on a residence visa differs depending on its type and sponsor. It may be for 1, 2, 3, years. However, according to recent changes a residence visa can also be issued for 5 and 10 years subject to certain conditions.

Question 76

How has the improvement in air transport reduced the friction of distance?

Answer 76

Planes have been equipped with jet engines, which makes them travel at a speed of 700-800km/hr.
Planes have also been improved in the number of passengers that can be carried within a specific time. This has made it possible for people to travel in their numbers within a shorter period of time. This has also made it possible for goods to be transported in large quantities i.e cargo planes transport perishable goods e.g DHL.
Air travel has also made it possible for the cost of travel to be significantly reduced which makes it possible for large numbers of people to travel.

Advantages:

• It is safer as compared to other modes of transport but the sea.
• It is faster over long distances.
• There is limited congestion compared to road transports.
• It is good for transporting valuable items and perishable goods.

Disadvantages
- Large chunks of lands are usually required to construct airport terminals.
- High noise and visual pollution in terms of greenhouse pollution.
- Aircrafts are difficult to build and expensive to maintain
There is no flexibility of routes.

Question 77

How has the improvement in road transport reduced the friction of distance?

Answer 77

Improvement in road transport over the years has also helped to significantly reduce the friction of distance between places eg the use of fossil fuels to replace coal and steam powered vehicles has significantly improved the relative speed with which most cars or lorries travel from one place to another for example, most cars today can travel at 200kn/hr.

Again, the development of bigger cars like buses that can carry as much as 86 passengers have helped to improve the capacity of road transportation thereby reducing the friction of distance.

Advantages:

• It is cheaper.
• It is cost effective in terms of maintenance.
• It is cheaper over long distance
• It is convenient for carrying goods for remote places.

Disadvantages

• It is limited in terms of the goods it can carry.
• It is dangerous compared to air and sea.
• It relies heavily on crude oil, which is the number one contributor to greenhouse gases.
• Vehicular congestion can sometimes increase the friction of distance/ time-space divergence.

Question 78

Examples of technology reduced the friction of distance?

Answer 78

1. Telephone
2. Computers and the internet
3. GIS and GPS

Question 79

How has the improvement in shipping transport reduced the friction of distance?

Answer 79

• Containerisation - Easy to stack and get on and off ships.
• Containers have made things cheap which increases the amount you can move
• Bigger ships increases capacity
• The fleet of containers is expanding alongside the size of the vessels
• Many of the larger container ships can carry 17,000 20 foot equivalent units (TEUs) but there are plans to build containers that can carry 25,000 TEUs however the number of ports to accommodate these ships is limited

Question 80

Define friction of distance

Answer 80

This is the reducedlikelihoodof people using a service the greater the distance that they live from it. Distance is an issue due to the time and costs to overcome it. Friction of distance is closely related to transportation and accessibility.

Question 81

Define Time-Space Convergence

Answer 81

This is when travel time between places decreases and distance declines in terms of its significance. It is generally brought about by transport innovations and improvements e.g. Airbus A380 can fly Paris to Adelaide in just 20 hours in 2013. (see first image on the right)

Question 82

How does the physical environment play a key role in determining the level of globalization in a country?

Answer 82

• Countries that have access to natural resources tend to be more globalized than countries that do not have natural resources.
• However, this is not always the case, as some resource rich countries are still very poor e.g. DR Congo.
• On the other hand, some countries are resource poor, yet their level of globalisation is very high example, UAE.

Question 83

How can Resource Availability affect globalization?

Answer 83

• Countries rich in resources such as gold, diamond attract TNCs and foreign direct investment which increases their level of globalization
• Countries with large populations tend to have increased globalisation such as China, Indonesia and India
• Coastal countries tend to have higher levels of global interactions, due to foreign ships docking at their harbors
• Countries located on flat and fertile lands attract high levels of global interactions. e. g they attract farmers and agricultural workers. This improves globalization.

Question 84

How can geographic isolation can have a negative impact on the level of globalization?

Answer 84

• Some land-locked countries tend to have lover levels of globalization than coastal countries
• Mountainous areas can also suffer lower levels of globalization i.e. the Himalayas which is very difficult to construct roads and settlements limits its level of global interactions.
• Remote islands such as Greenland are disconnected from the rest of the world due to the extremely cold temperatures however, islands such as Hawaii are highly globalized

Question 85

How has palm oil led to global interactions?

Answer 85

The exploitation of palm oil has led to global interactions because of human demand. This is because the majority of palm oil production has been used for common everyday use products such as shampoo.

Used in processed or prepared foods such as bread, cakes, breakfast cereals and ready meals, as well as ice cream, margarine and crisps.

Palm oil is also cheaper than other types of oils.

Question 86

What are the environmental impacts of palm oil?

Answer 86

Majority of the world’s palm oil comes from Malaysia and Indonesia where the expansion of the of the industry has destroyed millions of hectares of rainforest. This deforestation is said to be fargreaterthan the rate of deforestation due to logging in the Amazon rainforest.

Question 87

Example of where palm oil is being traded.

Answer 87

Palm oil is being traded as a commodity on the Bursa Malaysia in Kuala Lumpur, Malaysia. Traders from all over the world can buy and sell Palm Oil Future Contracts and Options in order to protect themselves against price fluctuations.