contemporary world

1. Three Major Areas of Globalization
 Economic globalization
 Cultural globalization
 Political globalization
Economic globalization is the increasing economic interdependence of national economies across the world through a rapid increase in cross-
border movement of goods, services, technology, and capital. Whereas the globalization of business is centered around the diminution of
international trade regulations as well as tariffs, taxes, and other impediments that suppresses global trade, economic globalization is the
process of increasing economic integration between countries, leading to the emergence of a global marketplace or a single world
market. Depending on the paradigm, economic globalization can be viewed as either a positive or a negative phenomenon. Economic
globalization comprises: globalization of production; which refers to the obtainment of goods and services from a particular source from locations
around the globe to benefit from difference in cost and quality. Likewise, it also comprises globalization of markets; which is defined as the union
of different and separate markets into a massive global marketplace. Economic globalization also includes competition, technology, and
corporations and industries.
 Current globalization trends can be largely accounted for by developed economies integrating with less developed economies by means
of foreign direct investment, the reduction of trade barriers as well as other economic reforms, and, in many cases, immigration.
 International standards have made trade in goods and services more efficient. An example of such standard is the intermodal
container. Containerization dramatically reduced the costs of transportation, supported the post-war boom in international trade, and was a
major element in globalization. International standards are set by the International Organization for Standardization, which is composed of
representatives from various national standards organizations.

2.  A multinational corporation, or worldwide enterprise, is an organization that owns
or controls the production of goods or services in one or more countries other than
their home country. It can also be referred to as an international corporation, a
transnational corporation, or a stateless corporation.
 Trade facilitation looks at how procedures and controls governing the movement of
goods across national borders can be improved to reduce associated cost burdens
and maximize efficiency while safeguarding legitimate regulatory objectives.

3. Cultural globalization refers to the transmission of ideas, meanings, and values around the world in such
a way as to extend and intensify social relations. This process is marked by the common consumption of
cultures that have been diffused by the Internet, popular culture media, and international travel. This has
added to processes of commodity exchange and colonization which have a longer history of carrying
cultural meaning around the globe. The circulation of cultures enables individuals to partake in extended
social relations that cross national and regional borders. The creation and expansion of such social
relations is not merely observed on a material level. Cultural globalization involves the formation of shared
norms and knowledge with which people associate their individual and collective cultural identities. It
brings increasing interconnectedness among different populations and cultures.
 Cross-cultural communication is a field of study that looks at how people from differing cultural
backgrounds communicate, in similar and different ways among themselves, and how they endeavor
to communicate across cultures. Intercultural communication is a related field of study.
 Cultural diffusion is the spread of cultural items—such
as ideas, styles, religions, technologies, languages etc. Cultural globalization has increased cross-
cultural contacts, but may be accompanied by a decrease in the uniqueness of once-isolated
communities. For example, sushi is available in Germany as well as Japan, but Euro-Disney outdraws
the city of Paris, potentially reducing demand for "authentic" French pastry. Globalization's
contribution to the alienation of individuals from their traditions may be modest compared to the
impact of modernity itself, as alleged by existentialists such as Jean-Paul Sartre and Albert Camus.
Globalization has expanded recreational opportunities by spreading pop culture, particularly via the
Internet and satellite television.
 Religions were among the earliest cultural elements to globalize, being spread by force,
migration, evangelists, imperialists, and traders. Christianity, Islam, Buddhism, and more recently
sects such as Mormonism are among those religions which have taken root and influenced endemic
cultures in places far from their origins.[

4. Political globalization refers to the growth of the worldwide political system, both in size
and complexity. That system includes national governments,
their governmental and intergovernmental organizations as well as government-
independent elements of global civil society such as international non-governmental
organizations and social movement organizations. One of the key aspects of the
political globalization is the declining importance of the nation-state and the rise of other
actors on the political scene. William R. Thompson has defined it as "the expansion of a
global political system, and its institutions, in which inter-regional transactions
(including, but certainly not limited to trade) are managed". Political globalization is one
of the three main dimensions of globalization commonly found in academic literature,
with the two other being economic globalization and cultural globalization.

5.  As a response to globalization, some countries have embraced isolationist policies.
For example, the North Korean government makes it very difficult for foreigners to
enter the country and strictly monitors their activities when they do. Aid workers are
subject to considerable scrutiny and excluded from places and regions the
government does not wish them to enter. Citizens cannot freely leave the country.

6. Is Globalization a Good Thing?
 There is a heated debate about the true effects of globalization and if it really is such a
good thing. Good or bad, though, there isn't much argument as to whether or not it is
happening. Let's look at the positives and negatives of globalization, and you can
decide for yourself whether or not it is the best thing for our world.
Positive Aspects of Globalization
 As more money is poured into developing countries, there is a greater chance for the
people in those countries to economically succeed and increase their standard of living.
 Global competition encourages creativity and innovation and keeps prices for
commodities/services in check.
 Developing countries are able to reap the benefits of current technology without
undergoing many of the growing pains associated with the development of these
technologies.
 Governments are able to better work together towards common goals now that there is
an advantage in cooperation, an improved ability to interact and coordinate, and a
global awareness of issues.
 There is greater access to foreign culture in the form of movies, music, food, clothing,
and more. In short, the world has more choices.

7. Negative Aspects of Globalization
 Outsourcing, while it provides jobs to a population in one country, takes away those
jobs from another country, leaving many without opportunities.
 Although different cultures from around the world are able to interact, they begin to
meld, and the contours and individuality of each begin to fade.
 There may be a greater chance of disease spreading worldwide, as well as invasive
species that could prove devastating in non-native ecosystems.
 There is little international regulation, an unfortunate fact that could have dire
consequences for the safety of people and the environment.
 Large Western-driven organizations such as the International Monetary Fund and
the World Bank make it easy for a developing country to obtain a loan. However, a
Western focus is often applied to a non-Western situation, resulting in failed
progress.

8. What is Globalization ? Meaning
and it’s Importance
The world is a global village. This is a phrase you must have had thrown around
during business discussions. Those who say this are most likely referring to how small
the world has become due to globalization which has removed boundaries to trade
and communication between people in different countries.
Globalization a process where people, companies, and governments from different
nations interact and integrate through international trade and investments has effects
on the environment, culture, political systems, economic development and on the
human physical well-being in societies around the world. Through the Internet, media,
planes, international business and embassies we are now more connected to each
other than ever before.

9. Due to globalization someone in China can easily communicate and sell their
products to an individual the US. The rise of globalization is largely attributed to
major changes in the telecommunications and transportation industries.
Globalization today allows for goods to be made and sold all over the world.
Companies to establish and compete for customers in many countries for example
fast food chains are opening outlets every day around the world. Also, companies
can operate where production costs are cheapest due to globalization. And it’s not
only products globalization also makes it possible to get services from around the
word e.g. via the internet a US-based company can hire an accountant in India to do
its taxes.
Globalization is not only about trade there is also the cultural aspect to it. Through it,
different cultures meet and people get to know and understand the various ways of
life and accept them. Now that you know what globalization is let’s get into its impact

10. POSITIVE IMPACTS OF
GLOBALIZATION
 Gives Access to a Larger Market
Through globalization countries and companies have access to a bigger consumer base.
Instead of only selling products in their country a business can expand to other regions
boosting sales and in the process making more money.
 Provides Cheaper Goods for Consumers
Because of globalization a lot of companies are moving to areas where their cost of
production is low they, in turn, offer cheaper products because they are not expensive to
make hence lower prices for consumers.
 Globalization Wets Countries do what They do Best
For example, a country can buy cheap steel from another country instead of making its
own steel. They can then focus their efforts on making other things they are good at like
computers and export them to the countries they import cheap steal from.

11.  Leads to Better Economies
With many multi nation’s heading to Africa to tap the consumer base in this part of the world more
jobs are being created helping people in these countries get better wages and improve their stands
of living. This investments by these multinationals or foreign countries also help strengthen the
economies of these countries with the foreign exchange they bring in. With an increased number of
investors looking for investments opportunities around the globe, country economies will benefit
wherever they invest. Through globalization economies of different countries are becoming more
connected to one another since they depend on each other for trade.
 Promotes World Peace and Unity
Globalization brings governments together so that they can tackle common goals together. For
example, due to globalization world leaders have seen the impact of pollution and have resolved to
tackle climate change together. Also, it is unlikely that a country trading a lot of products and
services with another will attack it or want to go to war with it.
 Innovation
The desire to make a profit has always been a spur to expanded trade, innovation, and the
communication of ideas. The great ideas from leaders spread more easily.
 Better Quality and Variety
Competition from different countries drives firms to improve their products. Consumers have better
quality products and more variety as a result.

12. NEGATIVE IMPACTS OF
GLOBALIZATION
 Causes Environmental Damage
Globalization has led to increased production for businesses in order to meet global
demand. Increased production means more natural resources are used and this can be
used up before they are regenerated leading to a negative impact on the environment. Also
in developing countries rules and regulations on environmental protection are not as strict
as in developed countries. This has seen some multinationals leave their countries to set up
in developing countries to take advantage of this lax regulation in the process they
manufacture products that are harmful to the environment.
 Causes Fluctuation of Prices
Increased competition means that businesses with the best prices win. Due to competition
prices are always fluctuating, for example, a country like the US has to reduce its prices
often to compete with prices for the same product coming from China. China’s production
costs are lower than the US hence they can have ridiculously low prices. For the US
companies reducing prices will have a negative effect on their profits which in turn may
led to actions like laying off workers.

13.  Job Insecurity
Globalization provides a double-edged sword when it comes to jobs. It creates jobs
for people in developing countries who provide cheaper manufacturing jobs. For
example, many companies are setting up in India and China because wages and
manufacturing jobs are cheaper there this means less opportunities in developed
worlds. In short, globalization takes jobs from one country and provides them to
another. This can be negative or positive depending on what part of the world you
are in.

14. World economy
 The world economy or global economy is the economy of all humans of the world,
referring to the global economic system that includes all economic activity
within nations and between nations, including production, consumption, economic
management, exchange of financial values and trade of goods and services. In some
contexts, the two terms are distinct "international" or "global economy" being measured
separately and distinguished from national economies while the "world economy" is
simply an aggregate of the separate countries' measurements. Beyond the minimum
standard concerning value in production, use and exchange, the definitions,
representations, models and valuations of the world economy vary widely. It is
inseparable from the geography and ecology of planet Earth.

15. It is common to limit questions of the world economy exclusively to human
economic activity and the world economy is typically judged in monetary terms,
even in cases in which there is no efficient market to help valuate certain goods or
services, or in cases in which a lack of independent research, genuine data or
government cooperation makes establishing figures difficult. Typical examples
are illegal drugs and other black market goods, which by any standard are a part of
the world economy, but for which there is by definition no legal market of any kind.
However, even in cases in which there is a clear and efficient market to establish
a monetary value, economists do not typically use the current or official exchange
rate to translate the monetary units of this market into a single unit for the world
economy since exchange rates typically do not closely reflect worldwide value, for
example in cases where the volume or price of transactions is closely regulated by
the government.

16.  Rather, market valuations in a local currency are typically translated to a single
monetary unit using the idea of purchasing power. This is the method used below,
which is used for estimating worldwide economic activity in terms of real United
States dollars or euros. However, the world economy can be evaluated and
expressed in many more ways. It is unclear, for example, how many of the
world's 7.8 billion people (as of March 2020)have most of their economic activity
reflected in these valuations.
 According to Maddison, until the middle of 19th century, global output was
dominated by China and India. Waves of Industrial Revolution in Western Europe
and Northern America shifted the shares to the Western Hemisphere. As of 2020,
the following 15 countries or collectives have reached an economy of at least
US$2 trillion by GDP in nominal or PPP
terms: India, Brazil, France, Germany, China, Indonesia, Italy, Japan, South
Korea, Mexico, Russia, Turkey, the United Kingdom, the United States and
the European Union.
 GDP - (gross world product)

17. Impact of the coronavirus pandemic on the
global economy - Statistics & Facts
While there is no way to tell exactly what the economic damage from the global COVID-19
novel coronavirus pandemic will be, there is widespread agreement among economists
that it will have severe negative impacts on the global economy. Early estimates
predicated that, should the virus become a global pandemic, most major economies will
lose at least 2.4 percent of the value their gross domestic product (GDP) over 2020,
leading economists to already reduce their 2020 forecasts of global economic growth
down from around 3.0 percent to 2.4 percent. To put this number in perspective, global
GDP was estimated at around 86.6 trillion U.S. dollars in 2019 – meaning that just a 0.4
percent drop in economic growth amounts to almost 3.5 trillion U.S. dollars in lost
economic output. However, these predictions were made prior to COVID-19 becoming a
global pandemic, and before the implementation of widespread restrictions on social
contact to stop the spread of the virus. Since then, global stock markets have suffered
dramatic falls due to the outbreak, and the Dow Jones reported its largest-ever single day
fall of almost 3,000 points on March 16, 2020 – beating its previous record of 2,300 points
that was set only four days earlier.

18. Charts show how the coronavirus
pandemic has hit the global economy
KEY POINTS
 To curb the spread of the coronavirus, authorities around the world implemented
lockdown measures that have brought much of global economic activity to a halt.
 Many businesses have been forced to reduce operations or shut down, and an
increasing number of people are expected to lose their jobs.
 Companies in the services industry, a major source of growth to many economies, were
among the hardest hit in the coronavirus pandemic.
 Manufacturers have also been hit, and world trade volume could once again plummet
this year.

19.  Since emerging in the Chinese city of Wuhan late last year, the coronavirus
disease has spread to 185 countries and territories — infecting more than 2.7
million people and killing over 190,000 globally, according to data compiled by
Johns Hopkins University.
 To stem further spread of the virus, authorities around the world implemented
measures to lock down countries and cities to varying degrees. That includes
closing borders, shutting schools and workplaces, and limiting large gatherings.
 Those restrictions, which the International Monetary Fund called the “Great
Lockdown,” brought much of global economic activity to a halt, hurting businesses
and causing people to lose their jobs.
 “This is a truly global crisis as no country is spared,” Gita Gopinath, the IMF’s
chief economist, wrote in a blog post earlier this month.
 Here are seven charts that show how the coronavirus pandemic has hit the global
economy.

20. Rise in unemployment
 Many economists have warned that lockdown measures around the world will
accelerate job losses — that’s already showing up in unemployment numbers in
several economies.
Services industry hit hard
 The services industry is a major source of growth and employment for many
countries, including the U.S. and China — two of the world’s largest economies
and consumer markets.
 But both countries reported sharp declines in retail sales as lockdown measures
during the pandemic forced many stores to shut and kept consumers at home. A
surge in online sales reported by some retailers, such as Amazon, failed to stem
the overall fall.
 Economists warned that consumers may not resume spending even after
lockdown measures are lifted. That’s evident in the “slow improvement” in retail
sales in China even after the country allowed a gradual reopening of businesses,
said analysts from Oxford Economics.

21. Slump in manufacturing activity (To fall to drop or Slide down suddenly)
 Manufacturers, already weighed down by the U.S.-China trade war in the last two
years, have once again come under pressure as the coronavirus spreads around
the world.
Another bad year for trade
 Global trade, which was already slowing in 2019, is expected to be weighed down
further this year.
Global economy to shrink in 2020 (Shrink – to become smaller)
 The coronavirus pandemic’s hit to economic activity has led many institutions to
slash their forecasts for the global economy.
 The International Monetary Fund, whose assessment of the economy is widely
followed, expects the global economy to shrink by 3% this year. Only a handful of
economies — such as China and India — are expected to grow in 2020,

22. International trade
International trade is the exchange of capital, goods, and services across international
borders or territories because there is a need or want of goods or services
Trade involves the transfer of goods or services from one person or entity to another, often
in exchange for money. Economists refer to a system or network that allows trade as
a market.
An early form of trade, barter, saw the direct exchange of goods and services for other
goods and services. Barter involves trading things without the use of money. When either
bartering party started to involve precious metals, these gained symbolic as well as practical
importance. Modern traders generally negotiate through a medium of exchange, such as
money. As a result, buying can be separated from selling, or earning. The invention of
money (and later of credit, paper money and non-physical money) greatly simplified and
promoted trade. Trade between two traders is called bilateral trade, while trade involving
more than two traders is called multilateral trade.

23. In most countries, such trade represents a significant share of gross domestic
product (GDP). While international trade has existed throughout history, its economic,
social, and political importance has been on the rise in recent centuries.
Carrying out trade at an international level is a complex process when compared
to domestic trade. When trade takes place between two or more nations factors like
currency, government policies, economy, judicial system, laws, and markets influence
trade.
To smoothen and justify the process of trade between countries of different economic
standing, some international economic organizations were formed, such as the World
Trade Organization. These organizations work towards the facilitation and growth of
international trade. Statistical services of intergovernmental and supranational
organizations and national statistical agencies publish official on international trade.

24. Characteristics of global trade
A product that is transferred or sold from a party in one country to a party in another country is
an export from the originating country, and an import to the country receiving that product. Imports
and exports are accounted for in a country's current account in the balance of payments.
Trading globally may give consumers and countries the opportunity to be exposed to
new markets and products. Almost every kind of product can be found in the international market,
for example: food, clothes, spare parts, oil, jewellery, wine, stocks, currencies, and water.
Services are also traded, such as in tourism, banking, consulting, and transportation
Advanced technology (including transportation), globalisation, industrialisation, outsourcing and m
ultinational corporations have major impacts on the international trade system

25. Increasing international trade is crucial to the continuance of globalization. Countries would
be limited to the goods and services produced within their own borders without international
trade. International trade benefits many countries in various aspects. In the case of Vizio's flat-
panel TVs, the manufacturing leadership has been shifting from one country to another due to
global economic growth. At first, Japan could assemble the components of this TV and sell it
out to the other countries such as US. However, recession affected Japan and South Korea
took the lead in assembling the parts of this TV. Samsung played a critical role in the selling
and manufacturing of the flat TV. Taiwan also took advantage of the recession that affected
South Korea, and the investors assembled electronic components of Vizio's flat-panel TVs. At
first, the US suffered from this cycle because despite inventing this business idea, other
countries implemented it in the international market. Chinese eventually started manufacturing
flat TVs at a lower cost compared to the previous investors. It is important to note that US
benefited from the cycle because many investors could manufacture the TV at lower cost
(Kandel, Kosenko, Morck & Yafeh, 2013). China is also another country that benefited from this
business because it started manufacturing the product late at a lower price. South Korea and
Japan suffered from the global recession because it was expensive to manufacture Vizio's flat-
panel TVs at the beginning.

26. Differences from domestic trade
 International trade is, in principle, not different from domestic trade as the motivation and the
behavior of parties involved in a trade do not change fundamentally regardless of whether trade
is across a border or not.
 However, in practical terms, carrying out trade at an international level is typically a more
complex process than domestic trade. The main difference is that international trade is typically
more costly than domestic trade. This is due to the fact that a border typically imposes additional
costs such as tariffs, time costs due to border delays, and costs associated with country
differences such as language, the legal system, or culture (non-tariff barriers).
 Another difference between domestic and international trade is that factors of production such as
capital and labor are often more mobile within a country than across countries. Thus,
international trade is mostly restricted to trade in goods and services, and only to a lesser extent
to trade in capital, labor, or other factors of production. Trade in goods and services can serve as
a substitute for trade in factors of production. Instead of importing a factor of production, a
country can import goods that make intensive use of that factor of production and thus embody
it. An example of this is the import of labor-intensive goods by the United States from China.
Instead of importing Chinese labor, the United States imports goods that were produced with
Chinese labor. One report in 2010, suggested that international trade was increased when a
country hosted a network of immigrants, but the trade effect was weakened when the immigrants
became assimilated into their new country.

27. Most traded export products

28. Activity
Can Globalization rise to the challenge and
stand up to the economic, human, social,
environmental and ethical threats in today’s
world ?

29. Environmental Challenges
A Global Concern
 It is undeniable today that the problems that threaten our society are becoming
global.
 Globalization puts more pressure on our planet and our welfare.
 All countries, rich and poor, face environmental challenges, sustainable
development concerns and the emergence of a precariat, calling for socially
responsible practices from businesses and States.
 Can Globalization rise to the challenge and stand up to the economic, human,
social, environmental and ethical threats in today’s world ?

30.  Environmental and social variables are considered today as important elements for a
peaceful society all over the world.
 The rampant consumerism
 The excessive industrialization
 The westernized economic model
All these elements, which are applied by developed and emerging countries today and
which will be embraced by developing countries tomorrow, are likely to shake the fate of
the world and endanger an already fragile social peace.