globalisation

• • Globalisation is the process by which economies around the world become more integrated through increased international trade, foreign investments, and the movement of goods, services, labor, and capital across borders.
• The current wave of globalization began in the early 1980s, driven by technological advancements such as the internet, and the reduction of trade barriers like tariffs and quotas
• • A notable shift in international trade occurred with the expansion of multinational enterprises (MNEs), companies like Walmart and Apple, which operate globally and often have more revenue than the economies of some less-developed countries.
• key aspects of globalisation:

  • Foreign Direct Investment (FDI)
  • Global Supply Chains
• Foreign Direct Investment (FDI):

  • FDI occurs when a company invests in a foreign country by building plants or acquiring resources, often to reduce production costs.
  • Example: Volkswagen builds a production plant in China to manufacture its vehicles.
• Global Supply Chains:

  • Products are often the result of a complex supply chain spanning multiple countries.
  • Example: An Apple iPhone is assembled from components made in over 30 different countries, highlighting how economies are interconnected through production processes.
• economic indicators of globalisation:

  • increase in world income
  • poverty reduction
• Increase in World Income:

  • The value of international trade as a percentage of global income has risen from 39% in 1980 to 56% in 2016. This reflects the growing share of wealth generated by international commerce.
• Poverty Reduction:

  • The percentage of the world’s population living in absolute poverty has fallen significantly, from 44% in 1980 to 9.6% in 2015. This is a direct result of the economic growth spurred by globalization.
• While globalization has led to economic growth and poverty reduction, it has also sparked debates about inequality and its distribution of benefits.
• 2016 US Presidential Campaign: Anti-globalization rhetoric became a major theme, with arguments suggesting that globalization negatively impacted domestic economies by outsourcing jobs to foreign countries.
• Brexit: Similar concerns over immigration and international trade fueled anti-globalization sentiments in the UK, leading to the vote to leave the European Union.