What is Globalization?

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What is globalization?




When did globalization begin?

The features of globalization

What are the environmental impacts of globalization?

Is globalization shifting power from nation states to undemocratic organizations?

How does globalization affect culture? Is it 'Americanization'?

Globalization in Russia

Who are the players?

What is the role of the internet and communications' technologies in globalization?




What is globalization?


Many people see it as a primarily economic phenomenon, involving the increasing interaction, or integration, of national economic systems through the growth in international trade, investment and capital flows.

However, one can also point to a rapid increase in cross-border social, cultural and technological exchange as part of the phenomenon of globalization.

Globalization is a capitalist process. It has taken off as a concept in the wake of the collapse of the Soviet Union and of socialism as a viable alternate form of economic organization.

Globalization is the rapid increase in cross-border economic, social, technological exchange under conditions of capitalism.


When did globalization begin?

The first great expansion of European capitalism took place in the 16th century, following the first circumnavigation of the earth in 1519 to 1521.

There was a big expansion in world trade and investment in the late nineteenth century. This was brought to a halt by the First World War and the bout of anti-free trade protectionism that led to the Great Depression in 1930. Some see this period as an interruption to the process of globalization commenced in the late 19th century.

A sense that the world was united was generated by the establishment of the International Date Line and world time zones, together with the near global adoption of the Gregorian calendar between 1875 and 1925. During that period, international standards were also agreed for telegraphy and signaling.

The end of the Second World War brought another great expansion of capitalism with the development of multinational companies interested in producing and selling in the domestic markets of nations around the world. The emancipation of colonies created a new world order. Air travel and the development of international communications enhanced the progress of international business.

The fall of the Berlin Wall and the collapse of the Soviet Union ended the cold war between the forces of capitalism and socialism with capitalism triumphant. The development of the internet made possible the organization of business on a global scale with greater facility than ever before.


The features of globalization

Globalization influences all spheres of our life: culture, business, trade, politics, environment and even our mentality. It connects different countries and nations, makes their cooperation easier. It makes everything and everyone similar or even identical.


What are the environmental impacts of globalization?

Global businesses are working hard to improve their environmental performance, with greater emphasis upon environmental reporting. A growing number of companies in sensitive industries, such as mining, forestry and chemicals, are producing independently audited environmental reports.

WTO rules expressly permit countries to take actions to protect human, animal or plant life or health, and to conserve exhaustible natural resources. However, such restrictions must pursue legitimate environmental objectives, and not be a disguised form of trade protectionism. The WTO rules do not prevent countries from banning or restricting the marketing of genetically modified organisms. But the anti-globalization movement considers that The World Trade Organization does not make it possible to block the trade in goods and services that are produced by environmentally damaging methods.


Is globalization shifting power from nation states to undemocratic organizations?

As the work of the United Nations has demonstrated, globalization is more effective when there are strong governments, with strong domestic institutions. Globalization benefits both big and small business, together with the citizens of those countries that embrace international trade. But what about those countries which don't have strong governments?

There is a danger that globalization is undermining nation states. First, it is that it is empowering corporations at the expense of the nation state, and secondly, that the international institutions such as the WTO and World Bank are not democratic.


How does globalization affect culture? Is it 'Americanization'?

It does not make sense to talk of a world of 6 billion people becoming a monoculture.

The spread of globalization will undoubtedly bring changes to the countries it reaches, but change is an essential part of life. It does not mean the abolition of traditional values. Indeed, new global media, such as the internet, have proven a powerful means of projecting traditional culture (and the culture of radical opponents of globalization).

But the report by the UN Educational, Scientific and Cultural Organization (UNESCO), showed that the world trade in goods with cultural content almost tripled between 1980 and 1991: from 67 billion dollars to 200 billion dollars. At the core of the entertainment industry - film, music and television - there is a growing dominance of US products. World Trade Organization rules do not allow countries to block imports on cultural grounds.

It is argued that one of the consequences of globalization will be the end of cultural diversity, and the triumph of a monoculture serving the needs of transnational corporations. Hence the world drinks Coca-Cola, watches American movies and eats American junk food.

American culture is seen to be dominated by monetary relationships and commercial values replacing traditional social relationships and family values.


Globalization in Russia

As often happens with such terms, the word "globalization" has become popular in our country only belatedly. To be exact, it has become popular among us at the very moment when people around the world have stopped talking about the rise of a new global economy, and instead have begun talking about its crisis. The fact that our commentators and theoreticians have begun speaking of globalization later than those in the West does not indicate that the process has passed us by or that its impact has been delayed. It simply testifies to the backwardness of our social thinking.

Russia is often discriminated on the world markets. The lion's share belongs , as always, to the developed countries and main benefits from globalization will be theirs. Our unlucky country has always been at the background and of course we have few chances to survive in the future 'united world'. A globalization that does not include the entire world is not globalization but "Westernization". The process of globalization implies growing competition but it is necessary that it proceed on an equal basis. It's an awful fact that Americanization has already influenced our national mind. Of course we want to have a good living level, we want to have a worthy life, but should we endow our spiritual values? Thanks God we still can resist!

I love my country, I proud of it and of course I think that globalization in it's modern meaning is extremely bad for it. Globalization threatens Russia with total damage and chaos.


Who are the players?


International organizations:

The World Trade Organization (WTO) http://www.wto.org was established in 1995 to administer the rules of international trade agreed to by its 123 member countries. These rules have been ratified by the parliaments of all members.

The key difference between the WTO and the General Agreement on Tariffs and Trade (GATT), which it replaced, is that the WTO is a permanent organization with the judicial powers to rule on international trade disputes. The WTO also covers trade in services, whereas GATT only covered trade in goods.

The WTO's rules make it hard for a country to favour their own industry over imports from other countries. Also, the WTO rules do not allow a country to favour the imports of one country over those from another.

The WTO argues that the growth of trade between countries increases the wealth of everyone. Trade allows the production of goods and services by those who are most efficient, thus maximizing their availability at the best price.

The growth of trade is helped by the lowering of barriers, such as tariffs and import quotas, which is the object of WTO agreements.

The International Monetary Fund (IMF) http://www.imf.org was established in the wake of the World War II in 1946 to:

         promote international cooperation on finance,

         encourage stability in exchange rates and orderly systems for exchanging money between

         providing temporary assistance for countries suffering balance of payments problems

The IMF frequently seeks institutional reform in the countries to which it provides temporary financial assistance. Like the WTO, the IMF believes that world prosperity is enhanced by greater exchange between nations and that this is made possible by everyone agreeing to abide by rules. The IMF has 182 member countries.

The World Bank http://www.worldbank.org provides loans to poor countries for development projects. The bank provides loans for investment projects, such as water and sanitation, natural resource management education and health. It also lends for what it calls adjustment projects, which are to support governments undertaking policy reforms, such as improved public sector management.

Established at the conclusion of the Second World War, the United Nations http://www.un.org has become a promoter of globalization, arguing that individual states have a dual role with responsibilities to both their own citizens and to the world society as a whole. The United Nations says the broader global responsibility requires international institutions. It supports the case for reform of international institutions, including its own Security Council, to make them more representative. The UN has sponsored a Global Compact to establish and promote a shared set of core values in the areas of labour standards, human rights and environmental practices between the UN and the business community http://www.unglobalcompact.org

The Organization for Economic Cooperation and Development (OECD) develops economic and social policy for its 29 members, which include the countries of North America, Western Europe (including Czech Republic, Hungary and Poland) and Japan, Korea, Australia and New Zealand. It provides economic arguments for globalization, such as data demonstrating the positive contribution made by multinational corporations to economic development. www.oecd.org/subject/growth/in_tr_gl.htm

United Nations Conference on Trade and Development (UNCTAD) is a permanent intergovernmental body of the UN that aims to maximize the trade investment and development opportunities of developing economies and to assist their efforts to integrate into the world economy http://www.unctad.org

The World Economic Forum (WEF) http://www.weforum.org is a private not-for-profit foundation that operates conferences for business, political, intellectual and other society leaders. The WEF holds an annual conference in the Swiss town of Davos, where it is based, and also holds regional conferences around the world. It has no decision-making power, but many of the world's business and political leaders discuss issues of importance at WEF meetings.


Public Affairs Organizations

Worldgrowth.org is dedicated to providing a balance to the debate about trade, globalization and sustainable development. It focuses on market based approaches to trade and growth for securing benefits in both developed and developing countries. http://www.worldgrowth.org

The Institute of Economic Affairs is a UK based free market think tank that aims to explain free market ideas including the benefits of globalization see http://www.iea.org.uk

International Policy Network (IPN) and the Competitive Enterprise Institute (CEI) are non­profit, non-government organizations that research and share ideas and issues such as globalization, global wanning, sustainable development and intellectual property. See http://www.policvnetwork.net and http://www.cei.org


Businesses benefiting from open international markets

Most organizations representing business endorse globalization and efforts to lower barriers to international trade and investment. For example, the International Chamber of Commerce argues that economic growth is essential if living standards around the world are to increase. Economic growth, it argues, is generated by trade. http://www.iccwbo.org/home/menu_case_for_the_global_economy.asp

Another international business organization, the World Business Council for Sustainable Development is working to build support for the UN's "Global Compact", www.wbcsd.ch

Australian peak business organizations, such as the Australian Chamber of Commerce and Industry have policy positions supporting globalization. www.acci.asn.au/index_policypapers.htm


Developing country governments and NGOs perceiving benefit from open markets

Most of the world's governments and parliaments are signatories to the World Trade Organization, and members of the international Monetary Fund. A number of the richer nations among the developing world, such as Mexico, Turkey, Egypt and Thailand, have provided vocal support for globalization. For example, Mexico's President Vincente Fox has pledged to expand the benefits of globalization throughout the hemisphere. usinfo.state.gov/regional/ar/summit/

There are also NGOs in developing countries who advocate the benefits of globalization through international trade.

Inter Region Economic Network, Nairobi http://www.irenkenva.org

Africa Fighting Malaria http://www.fightingmalaria.org

Liberty Institute, New Delhi http://www.libertyindia.org


Australian points of view

The Australian Labor Party maintains that engagement with the global economy is essential to Australia's future prosperity. Its policy is spelt out on its website at: http://www.alp.org.au/policv/platform2000/chapter_05.html

Often controversial author, and then backbencher, Mark Latham gave a speech entitled Globalization: Ending the Tyranny of Distance that is viewable at www.thirdway-aust.com/page10.html

The foreign minister, Mr Alexander Downer, expressed the Liberal Party view to the Press Club saying that globalization has increased GDP, employment, family incomes and living standards generally in Australia. www.dfat.gov.au/media/speeches/foreign/2001/010301_fa_npc.html

The views of the Australian Democrats are represented in The Age Millennium Series, which includes comments from leader Natasha Stott Despoja on globalization. Go to www.theage.com.au/special/vision21/index3.htm


Internet and telecommunications industry

One of the driving forces of globalization is the advance of telecommunications in general and the internet in particular. Representative organizations regard the spread of communications technology as a benefit without qualification. For example, the International Telecommunications Union sees globalization as the innate human desire for the integration of individuals in villages and cities and the integration of people of all races and backgrounds into nations. www.itu.int/osg/dsg/speeches/2000/08its.html

Other organizations are concerned that the free spread of communications technology proceeds without impediment of censorship or any other official constraint. See for example the Global Internet Liberty Campaign www.gilc.org


What is the role of the internet and communications technology in globalization?

Many within developing countries see the internet as an opportunity to gain access to knowledge and services from around the world in a way that would have been unimaginable previously. Internet kiosks, mostly facilitating email with overseas relatives, for example, are springing up in many parts of Africa.

The internet is also creating new gaps between the rich and the poor. Rich countries have much greater access to the internet and communications services generally. We are moving from an industrial age, in which wealth was created by manufacturing, to an information age in which wealth is created by the development of information goods and services, ranging from media, to education and software. Poor countries are not taking part in this information revolution.



In the case of globalization the theory and practice of the phenomenon are different. In fact it's not an exchange of achievements, but the absorption many different cultures by one strong culture. I'm for globalization in its original meaning, but I'm against Americanization.


Yafasova Alina

11th "А" form, school #63,

Novosibirsk 2004

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