Globalization Challenges and Effects

What is Globalization?

• Globalization is a process of interaction and integration among people, companies, and governments of different nations, driven by international trade and investment, and aided by information technology.
• This process has effects on the environment, culture, political systems, economic development, and human physical well-being in societies around the world.

Characteristics of Globalization

• Expanding business and trade across national borders to secure integration of economic interests and activities globally.
• Aiming to create a truly interrelated, interdependent, developed global village.

Drivers of Globalization

• International trade and investment
• Advances in information technology, particularly in transforming economic life.

Ethical Issues of Globalization

Unfair Economic Practices

• Reduction of protectionism can be unfair if not applied fairly.
• Protectionism includes restricting imports from other countries through tariffs, quotas, and government regulations.

Exploitation and Inequality

• Inequality of power can lead to massive exploitation by multinationals, especially with no or few trade unions.
• The gap between rich and poor is still very large, with 40% of the world's population living on less than $2 a day.

Negative Consequences of Globalization

• Economic globalization can marginalize the poor, destroy the environment, and damage cultures.
• Globalization increases inequality and further impoverishes the poor.
• Global problems, such as pollution, resource shortages, global warming, and health hazards, are by-products of the expansion of the global economy.

Poverty and Inequality

• Poverty is still a significant issue, with many people dying due to poverty.
• Aid and a fairer trading system are crucial to help poor countries.
• Income gaps have widened both within countries and between countries.

UN Study on Fair Globalization

• A recent UN study by ILO called for a fair globalization, highlighting that global trade increases wealth, but the benefits are not shared equally.