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| Alternatives
to Economic Globalization
Positive and negative impacts of globalization
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iClearDebt - August 20, 2007
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Speaking about positive and negative socio-economic impacts
of globalization it is necessary to underline that the general
effect of globalization is dubious regarding at developed
and developing countries. In general, it is developed countries
that basically benefited from globalization while developing
countries are in a rather deprived position since the trend
that is often singled out by specialists concerning globalization
is the fact that rich countries become richer while poor becomes
poorer. Consequently, globalization is obviously positive
because it enriches developed countries and negative as it
deteriorate the situation within developing countries. Furthermore,
another positive impact of globalization is new markets and
consequently new perspectives that open basically before developed
countries. The development of competitiveness may be treated
as a positive impact as well since the wider market is the
more severe is competitiveness. In socio-demographical terms
globalization contributes to free movement of labor force
that is obviously positive for the countries which suffer
from unemployment and in such a way they can export their
labor force. Finally, some specialists believe that elimination
of financial barriers is also positive since it contributes
to development of free trade.
However, practically all positive impacts mentioned above
have their other side, that is rather negative. So, if some
countries (basically developed) become richer due to globalization
than it is natural that they do it because other become poorer
(basically developing). Furthermore, globalization opens new
markets but mainly for producers from developed countries,
at least their products are much more expansive than that
of developing ones. As for competitiveness, it is positive
without any doubt but the problem is that in the competitive
struggle developed countries has obvious advantages, since
they possess hi-tech and well-developed infrastructure, while
developing countries has nothing but their natural resources
to offer on the world market. Moreover, current competitiveness
would eventually result in lack of competitiveness at all
if the global market is not regulated by anti-monopoly laws.
Speaking about relatively free movement of labor force, for
instance in the EU, it is positive mainly to new members,
or in global terms to developing countries, but not for ‘receivers’
of new employees. Finally, elimination of financial barriers,
disappearance of quotas, etc. may have negative consequences
as well, since it makes the markets of certain countries or
even regions unprotected that may be crucial for local economies.
Thus, in conclusion it may be said that globalization has
both positive and negative impacts, the problem is that developed
countries are in a better position than developing ones and
consequently globalization leads to free but not always fair
trade, and as a result economic, socio-political and cultural
integration of practically all countries of the world.
CEO of a Central America IT corporation in Europe
In order to globalize the service of CEO of a Central America
IT corporation it would be very desirable to either acquire
some local company working in the same segment of the market,
or at least to develop contacts with it. Naturally, before
starting the expansion in the European market it is necessary
to start an advertising campaign using the most advanced technologies,
including Internet. Than it is recommended to develop the
company’s infrastructure within the market it is supposed
to operate in. Finally, the main goal of the corporation should
be the creation of its own brand, quite popular and well-known.
Otherwise, if the corporation possessed enough financial resources
it would be possible to acquire some brand famous in Europe.
Trade barriers related to globalization
In fact the trade barriers that are related to globalization
are rather a respond of the countries which aims at the protection
of the local market from the expansion of foreign corporations.
Traditionally, among the main barriers are named financial
ones, such as taxation that is to a certain extent unfair
for domestic and foreign corporations, for instance it is
observed textile and clothing industry in Bangladesh for instance,
where foreign investments are strictly limited by local legislation
and where an overwhelming part of the market is controlled
by domestic companies.
Another significant barriers to globalization are different
quotas existing in some countries. For instance, the recent
arguments concerning Chinese food export to Europe and its
quotation is quite eloquent illustration of the problem.
Finally, it is possible to mention such a tool as antidumping
that traditionally protects local producers from foreign expansion,
as it happened to Russian metallurgic export to the US, for
instance, when American companies insisted on antidumping
of Russian products.
Examples contributing to expand the globalization
Basically it is contemporary technologies and free trade that
contributed the most significantly to expand of the economic
globalization. So, among them may be named Internet and the
rapid development of IT that made geographical borders disappear
in international economic relations. At this respect another
factor that contributed to expand of globalization is in a
way the effect of the previous ones and it is free trade.
The global economy has never experienced such a development
of trade relations between the country and so rapid elimination
of financial barriers in free trade.
Lack of competitiveness as the way to degradation
It is obvious that the lack competitiveness leads to degradation.
In fact there are a lot of examples when some corporation,
being a monopoly, controlled whole branches of economies of
certain countries but eventually they degraded. Such a trend
is particularly dangerous in the conditions of globalization
when the effect would be global. The reason why lack of competitiveness
leads to degradation is quite simple since lack competitiveness
implies that there is no need to improve the quality of products
or services because consumers have no real alternative and
they will buy a product or service offered regardless its
quality.
Bibliography:
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through Young Technology Companies. New York: New Publishers,
1997.
3. Danaher, C. Seven Arguments for Reforming World Economy.
London: Routeledge, 1999.
4. Gomory, R.E. Globalization: Causes and Effects. New York:
Touchstone, 2002.
5. Khor, M. Global Economy and the Third World. New York:
New Publishers, 2001.
6. Rodrick, D. Alternatives to Globalization. New York: New
Publishers, 2002.
7. Rolf, K. World Economy: Past, Present, Future. London:
Routledge, 2000.
8. Steward, L. Globalization and Alternative Ways of Development.
New York: Routledge, 2001.
9. Terry, P. Trends of the World Economy. New York: Guilford,
2000.
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a New Balance. London: Routledge, 2000.
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New York: Guilford, 2000.
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