Download - DEMERITS OF GLOBALIZATION

The Other Side Of Globalization

SHAIKH AAMIRSUFYAN ALISYED FARAZ HUSSAIN SHAHYASIR ASGHARSOHAIB BIN SAEEDSHAHAB KHAN

What is Globalization?

Increasing global connectivity. Integration and interdependence in the

economic, social, technological, cultural, political, and ecological spheres.

An umbrella term and is perhaps best understood as a unitary process inclusive of many sub-processes that are increasingly binding people and the biosphere more tightly into one global system.

The influence of globalization

Industrial - emergence of worldwide production markets and broader access to a range of goods for consumers and companies.

Financial - emergence of worldwide financial markets and better access to external financing for corporate, national and subnational borrowers.

Economic - realization of a global common market, based on the freedom of exchange of goods and capital.


Political - Political globalization is the creation of a world government which regulates the relationships among nations and guarantees the rights arising from social and economic globalization.

Social - the achievement of free circulation by people of all nations.

Informational - increase in information flows between geographically remote locations.


Cultural - growth of cross-cultural contacts; cultural diffusion; "world culture".

Ecological- the advent of global environmental challenges that can not be solved without international cooperation, such as climate change, cross-boundary water and air pollution, over-fishing of the ocean, and the spread of invasive species.

Other faces of Globalization

Globalization= Imperialism Globalization = Americanization Globalization = Delocalization Globalization = Multinational corporations Globalization = Branding Globalization = the rich gets richer, the poor gets

poorer

Other Faces of Globalization Economical

Exploitation of the resources in the third world country

Local Industries are being taken over by Multi-nationalists.

The benefits of Globalization are not universal, the richer gets richer and the poor gets poorer.

Other Faces of Globalization Political

There are international and regional trade agreements, and powerful international lobby and pressure groups in various fields.

Globalization includes penetration of political ideas and practices across borders. It includes infusion of cultural and religious beliefs and practices, resulting in weakening of some cultures

Other Faces of Globalization Political

Multi-national Companies and Corporations which were restricted to commercial Activities are increasingly influencing political decisions.

Other Faces of Globalization

Cultural Fast Food Chains like KFC & McDonalds are spreading. Local or minority culture are facing the fate of disa

ppearing Western culture invaded into developing countries Example: McDonalds

More than 100 countries 30,000 restaurants Serves 50 million people daily


Cultural Infusion of cultural and religious beliefs and practi

ces, resulting in weakening of some cultures. Bad aspects of foreign cultures are affecting the lo

cal cultures through T.V and Internet. Threat that control of world media by a handful of

corporations will limit cultural expression


Environmental Aggravated pollution, Global warming, losses in

biodiversity and species extinction. Average global temperatures are estimated to rise

1- 3.5 centigrade (33.8 – 38.5 degrees) by 2050. Developed industrial countries export hazardous

waste to third world countries. Deadly Diseases are being spread by travelers to the remote corners of the world.


Women and children 90% of the workers at the

sweatshops are women Child labor hired by global

companies in developing countries Example: 14-year-old workers in Nike factories

in Indonesia


Human rights More and more strict immigration restrictions in develo

ped countries, no free move for labors In sweatshops in developing countries, harsh working

conditions, low pay and overtime working are common Example: The Pouty Bratz dolls factory in Southern Ch

ina Working 94 hours a week 17 cents, workers are paid for making each doll; $19, retail price in US More than 120 million Bratz dolls sold since 2001


Exploitation of Labor Job insecurity and Low-Wages due to competition. Prisoners and Child labors are working in Inhumane

conditions. Safety Standards are

ignored to produce

cheap goods.


Social The unequal wealth distribution worldwide The gap between the developed countries and the

third world counties The gap between

the poor and rich

Who is The Beneficiary ?

Per-Capita Income Globalization leads to a shift in wealth from

workers, consumers, and developing countries to multinationals.

Example:McDonald’s is accused of preventing union

formation and paying substandard wages in its restaurants abroad.

Per-Capita Income

R2 = 0.56

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

$0 $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 $35,000 $40,000 $45,000

Per-capita Income (US$)

Per

-cap

ita T

rade

(US

$)

Lower middle, and low income countries

Luxembourg

Belgium

Ireland Netherlands

JapanUS

Bahrain

Who is Beneficiary ?

Income Distribution Globalization results in a concentration of income

so that the few benefit disproportionately to the many.

Example: Bill Gates, Sam walton, Mukesh Ambani etc ….

Income Distribution

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

15.0 20.0 25.0 30.0 35.0 40.0 45.0 50.0 55.0 60.0 65.0

Gini Coefficient (0 = equitable, 100 = inequitable)

Per

-cap

ita

Tra

de

(US

$)

US

Switzerland

Ireland

Finland

Cyprus

Netherlands

Singapore

Hong Kong

NorwayDenmark

SwedenAustria

CanadaGermany

IsraelFrance

Slovenia

GabonSouth Africa

Malaysia

Source: International Financial Statistics, International Monetary Fund, December 2001, and Measuring Income Inequality: A New Database, Deininger, Klaus, and Lyn Squire, World Bank, 2002

median


Life Expectancy: Increases in life expectancy, decreases in infant mortality,

better nutrition accrue mostly to developed countries. Globalization causes a reduction in health measures for lesser developed countries.

Globalization causes agricultural resources to be diverted to meet the needs of exporters rather than local needs. People driven off rural land are forced to work in overcrowded cities without proper water and sanitation. Foreign-owned firms, unfettered by environmental and health regulations, pollute the environment of lesser developed countries and maintain inadequate working conditions.

Life Expectancy

R2 = 0.59

$1

$10

$100

$1,000

$10,000

$100,000

30.0 40.0 50.0 60.0 70.0 80.0 90.0

Life Expectancy (years)

Per

-cap

ita

Tra

de

(US

$, l

og

arit

hm

ic s

cale

)

US

PakistanIndia


Environment: Firms in developed countries have incentive to

exploit the environment in developing and under-developed countries. Greater industrialization puts greater stress on the environment.

Deforestation. Co2 Emissions.

CO2 Emissions

R2 = 0.72

$10

$100

$1,000

$10,000

$100,000

0 5 10 15 20 25

CO2 Emissions per capita (metric tons)

Pe

r-c

ap

ita

Tra

de

(U

S$

, lo

ga

rith

mic

sc

ale

)

Hong Kong Singapore

Luxembourg

USKuwait

KazakhstanUkraine

RussiaPoland

BelgiumSwitzerland

Countries that are more globalized generate more

CO2. This is to be expected because greater

globalization usually implies greater industrial and consumer activity.

Source: International Financial Statistics, International Monetary Fund, December 2001, and World Development Indicators, World Bank, 2002

Can All Countries Benefit from Globalization?

Establish international monitoring system Domestic:

each country should build up a system that can integrate into the global market

protectionism in the domestic market International:

International institutions should reform to fit into the needs of the globalization, such as IMF, World Bank, UN

Be more responsible for all the countries, rather than some or few countries

Be more transparent and be monitored by member countries from third world.

Can All Countries Benefit from Globalization? To enhance corporations between countries and reg

ions Make free trade free and fair for both developing

and developed countries Eliminate or reduce the trade barriers Get more countries involved into the global market Equal and balance development in the global

market

Questions and Comments