Globalization and its Principal Outcomes Essay
Globalization and its Principal Outcomes
Globalization mainly concentrates on trade and commerce between nations and creates a global market, in which goods and services easily flow from one nation to another, without any barrier. All the countries would equally share the production resources and allow the free movement of resources between them, in the global community. The African countries have always been exporting raw materials like minerals and agricultural produce, which are utilized in the production sector of the Western markets.
They do not have any significant production facilities; hence they have to borrow, in order to import manufactured goods. The Western markets employ trade tariffs and other such economic stratagems to drastically reduce the price of these imports from these African nations, while increasing the cost of the exports to these countries. The result is that the African nations suffer from a balance of payments problem (Mutethia, 2000). Globalization has both advantages and disadvantages. Some of its advantages are enhanced productivity, low interest rates and a low rate of global inflation.
It not only provides a high level of protection to economies, but it also promotes inequality of income. This has been evident in the developments around the world. There is increased disparity in income and an imposition of protectionist approaches in the developed nations. Globalization eliminates national borders and permits the free flow of services and goods from one nation to another. It provides greater opportunities to developing nations to widen their market area and enter the global market. However, this type of open trade is unsuited to poor nations (Tompkins & Harmelink, 2004.
P. 34). Liberalisation is the main component of globalization, and constitutes its first and foremost condition. Advocates of globalization argue that the state’s role must be limited to security and defence. In all other aspects, the state must play a subordinate role. As such, many of the developing nations have autocratic rule, and there is abuse of power and office by government officials. Moreover, these countries do not adopt proper economic management. All these factors contribute to their underdevelopment.
Therefore, countries with these characteristics cannot meet the challenges posed by globalization. Thus, liberalisation, in all aspects, is the prerequisite for the success of globalization. However, rapid liberalisation would only cause harm rather than benefit (Africa News, February 18, 2007). According to Stiglitz globalization is a process that is unsuitable for poor nations. It does not promote the stability of the global economy. He also added that the first to fall prey to globalization would be the developing economies.
The poor in these nations would become poorer, and the disparity in power across the globe would be perpetuated. The principal financial institutions that engender this process are the IMF and the World Bank. These institutions, characteristically lack transparency in their dealings and they are controlled by the developed world (Ehrlich & Ehrlich, 2004. P. 327). The less developed countries experienced a reduction in the restrictions placed on the financial and trade markets in the beginning of the 1980’s. These changes served to engender greater political freedom in these countries.
This extraordinary process of globalization can be assumed to improve the democratic systems of governance (Rudra, Oct, 2005). Developing countries suffer from the unequal power distribution brought about by globalization. At present the world is experiencing a number of adverse effects due to globalization. These effects are not limited to the developing and poor nations; and they are also being experienced by most of the developed nations. That is the power of globalization (Kaur, October 12, 2007 ; Pg. 25 ). At present, these nations are experiencing the adverse effects of globalization.
Under the globalization policy, there should not be any restrictions on free trade. However, in practice this policy is not followed by many nations. For instance, African agricultural produce is subjected to severe restrictions in the western markets. The latter impose heavy tariffs on the African produce in order to protect their own industries within their nations. These are protectionist pressures, created by globalization. Therefore, globalization has failed to ensure the free movement of goods and fair competition (Africa News, February 18, 2007).
A significant number of people continue to argue that globalization ushers in negative outcomes for the world. Its effect has been to render the rich richer and the poor poorer. It is the claim of economists that globalization brings about more benefits for all. However, the poor are neglected in this process, as they could not get a fair share of the profits generated by globalization. It is important to note that social security and other governmental policies could be instrumental in reversing the negative outcomes of globalization, and eliminate inequality and poverty in the developing nations.
Some of the other tools that promote a fairer system of cooperation are fair trade and patent laws (Sen, April 27, 2007, Pg. 14). The chief objective of globalization is to implement a world order that benefits the capitalists. It is naive to assume that globalization is nothing more than an increase in worldwide mutual interlinking, brought about by technological change and market forces. A number of countries of the world have been afflicted with financial crises, which have served to highlight the ills of globalization.
List of References Africa News.(February 18, 2007). Rwanda; Is Globalisation Another Form of Imperialism? The New Times . Ehrlich, P. R. , & Ehrlich, A. H. (2004. P. 327). One with Nineveh. Island Press. Kaur, H. (October 12, 2007 ; Pg. 25 ). The rich, too, begin to feel globalisation pinch. New Straits Times (Malaysia) . Mutethia, J. (2000, August 15). Africa and Globalization. Retrieved October 21, 2008, from Global Policy Forum: http://www. globalpolicy. org/socecon/develop/africa/glob. htm Rudra, N. (Oct, 2005). Globalization and the Strengthening of Democracy in the Developing
University/College: University of Arkansas System
Type of paper: Thesis/Dissertation Chapter
Date: 19 December 2016
Let us write you a custom essay sample on Globalization and its Principal Outcomes
for only $16.38 $13.9/page