Globalization

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MBA-III, Uniglobe College, Kathamandu, Nepal

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Globalization

  1. 1. Globalizationrefers to the increasingly global relationships of culture, people, and economic activity. It is generally used to refer to economic globalization: the global distribution of the production of goods and services, through reduction of barriers to international trade such as tariffs, export fees, and import quotas.
  2. 2. According to most researchers, it is the modern age which led to the origin of globalization.
  3. 3. In this age, wide spread development took place in the field of infrastructure and connectivity. This led to more interaction between the nations and sharing of ideas, culture and tradition took place.
  4. 4. However, there are some researchers who point out that the origins of the history of globalization can be traced back to the ancient civilizations. The example of the earliest forms of globalization is the trade links between the Sumerian civilization and the Indus Valley Civilization. In fact, after this age, there are numerous instances where trade links were established between various countries like India, Egypt, Greece, and Roman Empire and so on. There were regular business links between the Parthian Empire, Roman Empire and Han Dynasty.
  5. 5. Globalization in the medieval age The Islamic period in the medieval era is an important epoch in the history of globalization. This was when the Jewish and the Muslim traders started going to various parts of the world to sell various items.
  6. 6. Globalization between the pre modern periods to modern period The industrial revolution in the 19th century was one of the major periods in the history of globalization. Due to the industrial revolution, there was a significant increase in the quantity and quality of the products. This led to higher exports and better trade and business relations. Due to better products and colonization, lots of countries across the world became the consumers of the European market. The phase of pre globalization perhaps came to an end after the First World War.
  7. 7. Globalization in the modern era Globalization, in the modern sense of the term, came into existence after the Second World War. One of the main factors for this was the plan by the world leaders to break down the borders for fostering trade relations between nations. It was also in this period that major countries like India, Sri Lanka, Indonesia and some countries in South America gained independence. As a result, these countries started having their own economic systems and established trade relations with the rest of the world.
  8. 8. The establishment of the United Nations Organization (UNO) was also a major step in this regard.
  9. 9. Another milestone in the history of globalization is the creation of the World Trade Organization which led to the growth of a uniform platform to settle trade and commercial disputes.
  10. 10. • refers to the intensification and expansion of cultural flows across the globe. • Culture is a very broad concept and has many facets, but in the discussion on globalization • symbolic construction, articulation, and dissemination • development of a global culture, the role of the media in shaping our identities and desires, and the globalization of languages. • Merging or “watering down” of the world’s cultures e.g. food, entertainment, language, etc. • Heavily criticized as destructive of local culture • e.g. The Simpsons is shown in over 200 countries in the world.
  11. 11. • refers to the global environmental issues. • includes population growth, access to food, worldwide reduction in biodiversity, the gap between rich and poor as well as between the global North and global South, human-induced climate change, and global environmental degradation. • seeing the Earth as a single ecosystem rather than a collection of separate ecological systems because so many problems are global in nature • e.g. International treaties to deal with environmental issues like biodiversity, climate change or the ozone layer, wildlife reserves that span several countries
  12. 12. • filled with a range of norms, claims, beliefs, and narratives about the phenomenon itself. According to Steger, there are three main types of globalisms • market globalism • justice globalism • and jihadist globalism. Steger defines them as follows
  13. 13. • Interconnection of the world’s financial systems e.g. stock markets • More of a connection between large cities than of nations • Example: What happens in Asian markets affects the North American markets.
  14. 14. • The formation of the World Trade Organization (WTO) and the acceleration of import liberalization had started in 1995. • It had further opened the economies of the developing countries to the influx of foreign companies, foreign goods and foreign service providers. • The organization deals with regulation of trade between participating countries. • It provides a framework for negotiating and formalizing trade agreements.
  15. 15. • Expanding free-trade concessions equally to all members. • Establishing free global trade with fewer barriers. • Making trade more predictable through established rules. • Making trade more competitive by removing subsidies.
  16. 16. • It oversees the implementation, administration and operation of the covered agreements. • It provides a forum for negotiations and for settling disputes.
  17. 17. • The WTO represents the rules-based regime of the policy of economic globalization. • The central operating principal of the WTO is that commercial interests should succeed all others. • Any obstacles in the path of operations and expansion of global business enterprise must be subordinated.
  18. 18. • World Trade Organization (WTO) talks collapsed from internal conflicting divisions and the weight of protests directed at labor, human rights, the environment and secrecy. • IT created a system that promotes healthy economic development which required creating new “rules,” new institutions and funds.
  19. 19. • A new architecture for global governance could have three elements: • Rules: New rules are needed to constrain capital flows to prevent the volatile, destabilizing, speculative movement of capital and to direct funds towards healthy development. • Institutions: A union of the UN Development Program, the UN Environmental Program and the WB. Recently it has increased Non-Governmental Organization (NGO) participation, inadequate, and its funding is grossly insufficient. • Incentives and Funds: Perverse subsidies those encouraging the extraction, mining, refining and combustion of coal and oil must be eliminated.
  20. 20. •The IMF is an international organization of 185 member countries. It was established to promote international monetary cooperation, exchange stability, and orderly exchange arrangements; to foster economic growth and high levels of employment; and to provide temporary financial assistance to countries to help ease balance of payments adjustments. • The IMF was conceived in July 1944, when representatives of 45 governments meeting in the town of Bretton Woods, New Hampshire, in the north-eastern United States, agreed on a framework for international economic cooperation.
  21. 21. • Surveillance • Lending • Technical assistance
  22. 22. • It is an assessment of economic and financial developments, which provides a framework that facilitates the exchange of goods, services, and capital among countries and sustains sound economic growth. It consists in: • Focusing on assessing whether countries' policies promote external stability • It is to be remembered that surveillance is a collaborative, candid, and evenhanded process between the Fund and its members
  23. 23. • IMF lending enables countries to rebuild their international reserves; stabilize their currencies; continue paying for imports; and restore conditions for strong economic growth. • IMF does not lend for specific projects • It eases the adjustment policies and reforms that a country must make to correct its balance of payments problem and restore conditions for strong economic growth.
  24. 24. • It supports the development of the productive resources of member countries by helping them to effectively manage their economic policy and financial affairs. • About 90 percent of IMF technical assistance goes to low and lower-middle income countries, particularly in sub-Saharan Africa and Asia.
  25. 25. • The term globalization is derived from the word globalize, which refers to the emergence of an international network of social and economic systems • The WTO represents the rules-based regime of the policy of economic globalization. • World Trade Organization (WTO) talks collapsed from internal conflicting divisions and the weight of protests directed at labor, human rights, the environment and secrecy.

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