Globalisation - Challenging Globalisation with Sustainability

Globalisation And Sustainability:

• The impacts of globalisation can be reduced with: Local sourcing, Fairtrade and ethical shopping, recycling

Local Sourcing:

• Getting foods and goods from close by
• Reduces ‘food miles’ – how far foods travel
• Therefore, less carbon dioxide and pollution is caused
• Can cause other benefits such as organic food so less chemicals are being used, less water pollution and biodiversity loss.

Fairtrade And Ethical Shopping:

• Ensuring ‘ethics’ apply to goods and trades e.g toys made in china or agriculture produce from Africa.
• Ethical shopping means it does not exploit the workers and help them e.g good wage, decent hours, safe conditions
• Fairtrade is one type of ethical shopping as it guarantees farmers a good price and also guarantees they can sell the produce. Also helps with education and training.

Recycling:

• Reduces ecological footprint by reusing materials which you already have rather than mining more from the ground or cutting down trees
• Reduces waste to landfill, paper, plastic, metals, electronics can all be recycled
• Reduces amount of energy and pollution created by products e.g Bolton now recycles

Other Info And Graphs:

• Lamb has the biggest food miles
• 18-34 have positive views on ethical shopping but don’t think it will make a difference.
• LEDCs still have lots of slavery e.g India has 14 million slaves, USA has 50k
• Recycling rates in England is increasing every year with peak at 50.0% in 2012/2013
• Ecological footprints in MEDCs countries are increasing but India and China have big ones because the country overall has lot of people but individuals don’t use a lot of energy.

	Positive:	Negative:
Local Sourcing:	Food miles and carbon footprint are reduced	Produce costs more – consumer uptake limited
Fairtrade & Ethical Shopping:	Farmers in LEDCs get a higher price for products	Too complex, some may not like it.
Recycling:	Reduces waste to landfill	Energy consumption is still high for processing and transport

Globalisation - Tensions Caused by Globalisation

Multiculturalism With Globalisation:

• Open boarders in the EU have increased multiculturalism
• Deregulation (free markets) have increased opportunities for FDI and workers
• More foreign workers and students now live in the UK
• Globalisaton of people can lead to conflicts due to race
• Globalisation of resources can cause conflicts e.g water and fossil fuels.

Example Of Culturally Mixed Societies:

• Russian elite in London – 300,000 Russians = £Billions
• Gulf states, low wage Asian workers from India, Pakistan. Large Asian communities in the UK who have colonial links and immigration.
• EU immigrants from Poland (1 million in the UK) have increased tensions
• Tensions Include: Racism, hate crime, riots, protest, stand-offs, arrests and vandalism.

Controlling Globalisation:

• Some counties censor globalisation of knowledge, ideas, education, culture and democracy e.g North Korea banning mobile phones, China banning Facebook and news outlets such as BBC News
• Some also limit immigration such as the UK who have strict rules for immigrants from outside the EU
• Trade is protected by large TNCs and foreign imports
• Amazon Tribes are fighting globalisation by protesting, Greenpeace are also doing the same

Retaining Cultural Identity:

• Amazon Tribes are doing this because outsiders want their land, whilst they want to keep it due to it having physical resources whereas some people also embrace globalisation's economic advantages.

Globalisation - Indices Measuring Globalisation

What Is Development:

• Development is how advanced a country is compared to others.
• It reflects the wealth of a country, the standard of living, the technology it has and the level of consumption and globalisation
• USA, UK, Japan, Europe, Australia, are MEDC (more economically developed countries)
• Many African countries like Chad are poorer LEDCs (less economically developed countries).
• China has some poor and some rich areas; therefore it is best to call it a ‘middle-income country’.
• The terms MDCs and LDCs can also be used for the very richest and poorest countries (Most and Least Developed Countries). E.g. USA versus Chad. See the world map next.
• The LDCs are at the ‘extremities’ of development: the poorest extreme position
• GDP is a single indicator often used to show the development level of a country. It measures the average income of each person in that country (US dollars). GDP per capita is the country income as a whole (GDP) then divided by the population number to get the GDP per capita!

Key Terms:

• Development gap: The (growing) difference in development between the richest and poorest countries
• Disparity/Inequality: The unequal distribution of wealth, rights or living standards can be within or between countries
• Development: The ways in which a country seeks to progress economically and to improve life for its habitants
• Absolute Poverty: When a person’s income to too low for basic human needs to be met, potentially resulting in hunger and homelessness.
• Relative Poverty: When a person’s income is too low to maintain the average standard of living in a particular society. There is asset growth for the very rich which leads to more being in relative poverty.

The Development Gap With Globalisation:

• Globalisation helps countries develop. However, there is a large gap between the richest countries in the world and the poorest. Known as the development gap. It is getting wider, although more countries like China are crossing the gap and becoming middle-income countries or even MEDCs like South Korea now is.

Economic Growth – Korea And The USA:

• USA is growing and increasing everyday
• Korea was once together and whilst they were, they were not growing
• Once the south separated in the 1970s, they grew whilst the North had a decrease in GDP

The Economic And Social Measures Of Development:

• Economic measures look at money and income, or overall wealth
• Social measures look at factors like education, health, gender issues and how the environment affects people’s living spaces
• Single indices measure one thing e.g. GDP or GDP per capita
• Composite indices combine several single measures onto one indices e.g. HDI measures 3 things: life expectancy (health), literacy (education), and income (GDP) combined

Types Of Scale:

• Income per capita/GDP: Mean average income of a group of people.
• Economic Sector Balance: 4 economic sectors whose relative importance changes as a country develops – used to share GDP calculation
• Human Development Index: Ranks country according to GDP
• Gender Equality Index: Measures gender equality based on reproduction health and empowerment of women (seats held in Parliament)
• Environment Quality Index: Measures air pollution as air is poor in developing countries. Usually improves with transition from industrial to machines.

Human Development Index (HDI):

• Composite indices measure of development
• Combines life expectancy (health), literacy (education), and income (GDP)
• Covers economic and social factors, so more reliable as a measure of development than just GDP per capita
• Africa and parts of Asia are at the bottom of the list (lowest development)
• ‘Western’ countries top the list e.g. Europe, USA, Australia. Norway often top!

Gender Inequality Index (GII):

• A measure of social development
• Measures several factors to test how the level of inequality (disparity) between men and women in the country
• Looks at factors like access to education, employment opportunities, etc.
• Chad has a very low score due to traditions banning women from many activities of opportunities. Africa and parts of Asia lowest scores
• Highest scores in Europe, with Scandinavian countries scoring well. Generally speaking, more developed and richer countries are more gender-equal.

Gini Coefficient or Gini Index:

• Evaluation: a limitation of GDP and HDI is that they do not show the inequality/disparity level within a country
• Gini Coefficient measures how unequal a society is by income variation
• High equality does not mean high development!
• Poorest scoring countries have a smaller number of rich elites and large relatively poor populations e.g. all Latin America. Most unequal country in the world = South Africa
• Europe scores well, i.e. inequality is relatively low. As with GII, Scandinavian countries have the highest scores (are the most equal).

Globalisation Winners And Losers:
Winners:	Losers:
Middle class	Environment
TNCs	Women
South Korea	The poor
Elite/professionals	Afghanistan
USA	Car industry workers in Detroit.

Globalisation - Globalisation of Culture

Key Terms:

• Cultural Diffusion: Spreading out of different cultures into new areas
• Westernization: Movement of culture towards English MEDC cultures e.g USA Fast Food and Music
• Consumption: The use of resources, goods and technology.
• Cultural Erosion: The loss of local/traditional cultures like music, language and lifestyles.

Overview:

• Globalisation increases cultural diffusion which causes cultural erosion
• TNCs play a huge role in culture e.g McDonalds spreading into China
• Tourists and migrants learn about other places and take expenses home
• As the world develops more places consume, more global products and more westernised.

Advantages:	Disadvantages:
More products	More resources consumed
New Experiences	Loss of cultural
More investment	More pollution
Glocalisation
Increased standard of living

Cultural Diffusion – A Positive Aspect:

• Spread of the Olympics has improved countries cooperation, sporting links and cultural
• Paralympics games have improved LEDCs viewpoint and cultural beliefs around people with disabilities.
• Example: In China, the disabled are respected and supported, 2008 torch was lighted with a wheelchair athlete.

Cultural Diffusion – A Negative Aspect:

• Westernisation: In China, obesity is increasing due to improving development and more disposable income. Also due to consumer westernisation increasing fast food consumption.
• Create more future health problems for citizens and more costs for the government to provide care and medicine.

Cultural Erosion:

• The loss of languages, music, traditional food, tribal traditions, clothing etc (replaced by western traditions).
• For example: Amazon Indians Tribes in Papua New Guinea

The Anti-Globalisation Movement:

• Mainly Greenpeace protests
• Various campaigns to fight mining, protect wildlife, reduce pollution, in wild areas and areas where indigenous people live

Globalisation - Globalisation of Migration

Key Terms:

• Rural-Urban Migration: Migration from the countryside to towns and cities
• Refugees: People who are forced to move due to war, famine, political persecution or natural disaster
• Economic Migrant: People who move for quality of life reasons usually economic gains
• Natural Increase/Decrease: The rise and fall of the population due to birth and death
• Net Migration: Balance between immigration and emigration
• Internal Migration: Movement of people within a country
• Megacity: A city with population over 10 million people.

Types Of Migrant:

• Displaced Person: Forced to move by war, famine, disaster or fear of persecution
• Voluntary Migrants: Permanent move for work or quality of life reasons or a temporary move for work.
• Illegal Migrants: Voluntary individual move for work, an organised move as part of criminal activity

Push & Pull Factors:

• Push Factors: Poverty, conflict, natural disasters, crop failure. They send remittance back to the country they came from
• Pull Factors: Education, healthcare, safety, housing, bright lights

Problems In Megacities:

• Rapid population growth, lack of clean water, lack of green space, pollution, overcrowding, gridlock, slums

Global Hub:

• A place or region that provides a focal point for global activities e.g trade and Shanghai
• They allow a country to become globalised as TNCs set up headquarters in that area

Elite Migration:

• When someone is rich moves to a country that is also rich e.g Russian celebs to London
• Why: Push – Russian Mafia, pull – London lifestyle

Effects Of Migration.

	Source Country:	Host Country:
Economic	Increase in taxes	Remittance
Social & Cultural	Bringing in culture such as Food	Loss of workers
Political & Environmental	New skills perhaps as politician	Environment gets better because lack of people in country.

Globalisation - Impact of Globalisation on Countries

Global Shift:

• International relocation of industry, especially manufacturing, mainly to Asia e.g China does manufacturing and India does services.
• MEDCs industrialised years ago, and are now deindustrialising. Newly Industrialised Countries (NICs) have more cheaper workers, fewer laws and regulations, less environmental controls etc. Therefore, more manufacturing now takes place in NICs.
• Why China: Open door policy, dedicated workers, good skills, SEZs like Shanghai, less regulations and taxes, coastline access to the Pacific ocean, available land.
• Why India: Educated to speak English, clever graduates, low wages, huge amounts of infrastructure which already exists.

Global Shift Benefits:	Global Shift Costs:
Education & Training	Loss of Land
Poverty Reduction	Unplanned Settlements
Waged Work	Resource Pressure
Infrastructure Investment	Environmental Prssure
	Pollution

Environmental Problems:

• Pollution: Harmful substances in the environment e.g China’s rivers have chemicals from factories.
• Land Degradation: Reduction in quality or ability to use land
• Over-Exploitation: Unstainable use of a resource such as water from rivers of cutting down trees
• Biodiversity: The variety of all life in an area e.g animals, plants

Economic Restructuring From Deindustrialisation Leading To Social and Environmental Problems:

• Former industrial areas have now deindustrialised due to the global shift and other factors like more automation (less workers needed)
• Economies in MEDCs e.g. Detroit in USA and Bolton in UK, have had to ‘restructure’ i.e. change!
• Some areas do not restructure as well as they need to, and problems such as high unemployment, depopulation, land dereliction and contamination, and high crime (spiral of decline etc) result

Why Detroit:

• Since 1950 population has halved (now 700,000)
• Automobile industry collapsed due to
• Competition and global shift
• City centre ‘white flight’ – moved to suburbs
• Poverty & crime risen: most dangerous US city

Globalisation - Indexes, TNCs & Switched-Off Countries

A.T. Kearney Index:

• Measures cities globalisation through business, culture, politics e.g. measures TNCs headquarters, museums, embassies
• Top cities include: London, New York, Paris, Tokyo, Hong Kong
• London is first because: Huge score on globalisation of culture e.g. English language, history, Shakespeare, Buckingham Palace, modern Art, fashion etc; around 8 million people: Human capital very high with many educated at degree level and working professionals, like bankers, insurance, services; the Houses of Parliament and the financial centre

KOF Index:

• A indicator index for how globalised countries are.
• Measures three main dimensions of globalisation: Economic (amount of FDI), Social (how many own a TV), Political (UN participation)

Summary Of Indexes:

• A.T.Kearney Index measures cities globalisation
• MEDC major cities are most globalised e.g. London, NYC
• KOF index measures countries globalisation
• Europe most globalised, and MEDCs, but Africa the least
• BOTH indices measures include economic/business, political, social/cultural measures
• All the world is getting more globalised constantly
• Useful to compare factors and different places in a rank
• Impossible to measure everything for an index – have to pick some indicators

Transnational Companies (TNCs):

• TNCs are huge companies and play a massive role in many issues such as economic growth, globalisation, migration, trade, industry, environmental pollution and so on. An example is Google, McDonalds, Apple, BP.
• TNCs use ‘glocalisation’ to sell more products, and make it easier to make products.
• They use local materials e.g. types of food, and adapt/change the product to match the area e.g. McDonalds food in India or Chinese is ‘glocalised’.
• McDonald's restaurants are found in 118 countries, serve 68 million customers each day, operates 36,615 restaurants worldwide, employing more than 420,000 people.
• Economic liberalisation allows TNCs to use the following two strategies to make more profits by two methods (listed below)
• Outsourcing: Obtain (goods or a service) by contract from an outside supplier e.g. call centre in India (or companies, Amazon)
• Offshoring: The relocation of a business process from one country to another, e.g. manufacturing in China (HQs, branch plants, division of labour)

Key Terms:

• Transnational Company: A company that has operations in more than one country
• Foreign Direct Investment: The spending of money by TNCs to invest into a country’s economy e.g. setting up a new factory
• Glocalisation: Changing a produce to suit customs and resources in one country
• Multiplier Effect: Investment, industry, jobs, taxes, and growth all increase and spiral upwards

Tesco Case Study (An example of an TNC):

• In 1919 Jack Cohen opened a small grocery store in East London destined to become Tesco. He made a whopping £1 profit on the first day… now they make £6.8 million profit each day. They have shops across the whole world.
• Their key to success has been: develop markets, glocalise, production networks
• They develop markets through methods like using the internet & technology to reach more customers, and diversify there goods that they sell, as well as expanding into other countries e.g. China
• Glocalisation to ensure more products sell better around the world e.g. Tesco ‘Lotus’ stores in Asia
• Production networks that help to reduce the cost of making and transporting goods and services, e.g. branch plants, offshoring and outsourcing
• However TNCs (and Tesco’s) aren’t all good: They are exploiting people in Asia or spreading the wealth
• Low wages – low living costs (exploitation, inequality and disparity?)
• Global transport pollution – packaging, carbon dioxide emissions from transport
• Cultural erosion – local products are in decline
• Local shops are closing

Are TNC Good Or Bad:
Advantages:	Disadvantages:
Taxes are paid to the host country	Local smaller businesses and shops have to close e.g. Tesco in Thailand
Improves infrastructure and creates a ‘multiplier effect’	Environmental pollution e.g. Tesco goods transport releases CO2
Technology transfer – aids development and skills	Cultural erosion
Creates jobs and wealth, and improves living standards	Exploitation of very cheap labour or even children e.g. Nike Sweatshop in India
	Removes wealth as profits go to richer source countries or parent company

Why Don't Some Countries Globalise - What The World Looks Like At Night:

• MEDCs are the most switched on, LEDCs aren’t that switched off – they aren’t globalised.

Case Study – North Korea:

• Switched off from world by being politically isolated by USA and other MEDCs due to threats of war. Very poor, undeveloped, and not globalised. Internet banned, watching Hollywood films results in execution, no-one can leave the country etc.
• Politically most isolated country on earth
• Enemy of Western governments, especially the USA
• Dictatorship led by the Kim Jong’s: at present Kim Jong-un
• Execution if you criticize the ‘Great Leader’
• Lack of technology, electricity, goods and services = switched off

Case Study 2 - Sahara Desert and Chad:

• Physical factors are those that are due to the environment and nature (not humans), such as climate, resources, and location
• Chad is a very poor country with low level of development
• Half the country is part of the Sahara Desert
• It has a very hot and dry climate, so little agriculture, which limits food production
• It has poor natural resources which means few exports e.g. no oil, little crops to sell to other countries
• It is ‘land-locked’ so it does not have good access to ports and the sea for shipping, trade and import/exports

Globalisation - IGOs & Trade Blocs

• Governments and politicians make very important decisions about trade and the economy. They form intergovernmental organisations to control trade and money. This means governments influence globalisation a lot.
• Countries form trade blocs to increase trade and to be more stable like the EU. UK government influences the private sector and businesses. As they want the economy to benefit from taxes and jobs
• Large countries and blocs have the biggest influences on economic decisions making. China has become important as they have their own political and economic impact on globalisation.

Key Terms:

• Free Trade: Trade is open across all borders without restrictions on quotas and without taxes added tariffs. Trade is unlimited without controls
• Free Market (Economic Liberalisation): Economy is open to all with no limitations or restrictions so foreign businesses can move in and operate, sell goods, employ people, takes profit – the UK does this.
• Foreign Direct Investment: Foreign countries and companies invest money into the country e.g Donald Trump have a golf course in Scotland, Coca-Cola factories in England and Call Centres in India.

Economic Organisations:

Name Of Organisation:	What They Do:
IMF (International Monetary Fund)	Allows loans
World Bank	Loans from MEDC to LEDC
WTO (World Trade Organisation)	Free trade

International Monetary Fund (IMF):

• HQ in Washington DC, the USA
• President always European
• Huge loans available to help development of poorer countries
• You must become a free-market economy to get them
• This means Western companies like McDonald's can move in to sell goods and make profits

World Bank:

• HQ Washington DC, USA
• Huge loans to help development and infrastructure
• Creates debt, dependency and can be corrupt

World Trade Organisation (WTO):

• Supposedly promotes Free Trade
• Based in Switzerland, Europe
• Good to increase trade and reduce tariffs and quotas
• BUT often very selective e.g. Wants China to remove charges on manufactured goods, but will not allow free trade with African farmers because the farmers might go out of business

Free Trade Blocs – The European Union:

• Trade is free across borders without restrictions on quotas and without taxes
• Movement is free and citizens can work anywhere
• Allows for more trade
• Cheaper products and better quality for consumers/more choice – this is cultural globalisation
• Economic migrant workers, free movement

Advantages:	Disadvantages:
Easier to trade so more exports and imports e.g. UK cheese, French wine	Trade blocs still have quotas and tariffs for countries outside the trade bloc.
More security for goods and products so less risk of running out	LEDCs cannot access the EU market, as the tariffs added to make the profits they earn too low, or quotas limit how much they can export to the EU
Businesses like technology can work together e.g. employ European engineers	Keeps the EU economies strong, but damages LEDCs in some areas
Increases globalisation, allowing more connections, flows and interdependence between countries.

National Government Policies:

• Free-Markets (Economic Liberalisation): Promote any business to come in and set up, e.g. HQs in London, pay taxes and provide jobs….
• Privatisation: The Conservatives like a competition between companies to improve the market e.g. better trains, mobile deals, etc.
• Business Start-Ups: Creates new future-economic benefits, such as new products to export, new jobs, more taxes, skills and replaces old declining industries like cotton.

China’s Open Door Policy – Case Study:

• Governments can open-up to investment (FDI), trade and the world free-market to aid development.
• 1978: China did this as it was badly isolated politically and economically.
• Over next 30 years, 300 million economic migrants like poor farmers moved to factories and manufacturing areas on the East coast.
• China set up Special Economic Zones (SEZs) to produce billions of goods for the world!
• 400 million now middle-class, but very restricted rights, poor environment etc.
• Huge impact on globalisation of trade, transport shipping and migration