Global Systems and Global Governance

• Globalisation


  Increasing interconnection of economic, political, and cultural systems worldwide.
• Global Village


  Concept by Marshall McLuhan emphasizing technology's role in breaking spatial barriers.
• Barriers to Globalisation

  Factors like political events, conflicts, trade wars, and economic crashes that impede global integration.
• Slazenger Tennis Balls


  Example illustrating the impact of global supply chain shifts from the UK to the Philippines.
• Information Flows


  Facilitated by technology like satellites and the internet for rapid data exchange.
• Capital Flows


  Involves remittances, foreign direct investment, profit repatriation, aid, deregulation, and digitization.
• Product Flows


  Movement of goods, highlighted by shifts in manufacturing locations and trade barriers.
• Flows of Services


  Involves high or low-level services and footloose services like banking.
• Flows of Labour


  Migration of workers impacting host countries' economies and social dynamics.
• Factors Driving Globalisation


  Includes economic factors, technological advancements, and social-cultural influences.
• McDonald's 'Glocalisation'


  Strategy adapting menus to local tastes while maintaining a global brand.
• Technological Advancements in Global Trade

  Innovations like containerisation and electronic communication revolutionising trade.
• Strait of Malacca


  Critical shipping route enhancing global trade, with ports like Felixstowe handling millions of containers.
• Global Security Issues


  Include terrorism (In 2015 Paris lost $644 million from tourism), war, food and bio-security, hacking, and piracy (there were 237 Somali attacks in 2011)
• Brandt Line


  Illustrates global economic disparities between the 'Rich North' and 'Poor South'.
• BRICs Countries


  Emerging economies challenging traditional economic hierarchies.
• Tiger Economies


  Rapidly growing economies like South Korea, Singapore, Taiwan, and Hong Kong.
• MINT Countries


  Traditionally poorer countries benefiting from trade, including Mexico, Indonesia, Nigeria, and Türkiye.
• Outsourcing to India


  Cost-saving strategy utilizing India's skilled workforce, infrastructure, and time zone advantages.
• Migration Impacts


  Benefits host countries with labor and tax revenue but can lead to exploitation and social tensions.
• Qatar's Migrant Workforce


  Case study highlighting economic investments, forced labor, and poor living conditions.
• Drawbacks of Outsourcing


  Negative impacts like job losses in HICs, exploitation in LICs/NEEs, and global labor division.
• Inequality and the Gini Index


  Measures wealth disparity, with factors like outsourcing and lack of education contributing to inequality.
• Lorenz Curve


  Graphical representation of income distribution, comparing wealth equality between countries like Canada and the USA.
• Problems with the 20s/30s

  -hyperinflation

  -economic crashes

  -faschism

  -communism and the USSR
• Hyperinflation


  rapid price increase caused by increased money supply not supported by economic growth
• Impact of economic crashes


  the Great Depression

  causes increased nationalism which can result in protectionism
• 1944 Bretton Woods Conference


  -delegates from 44 countries

  -regulate trade and increase prosperity after WW2

  -promote free trade

  -IMF, World Bank, and GATT (now the WTO)

  -fixed exchange rate established
• How was a fixed exchange rate established?


  -the price of the dollar was linked to gold

  -other currencies were linked to the dollar
• 1944 World Bank


  -189 members

  -Washington DC HQ

  -provide financial and tecnhical support

  -long term assistance with a focus on development

  -funded by investments on the bond market
• 1944 International Monetary Fund


  -190 members

  -Washing DC HQ

  -oversees global financial systems

  -prevents global economic crisis, seen as a last resort

  -funded by member fee
• Example of the IMF in action


  gave $40 billion to Greece from 2010-2015 in emergency funds
• 1947 GATT / 1995 WTO


  -164 members

  -Geneva HQ

  -promotes free trade
• Criticisms of the World Bank


  Top down approach pre-90s

  Structural Adjustment Plans (SAPs) neo-colonial strategy used by developed countries to maintain influence over developing countries
• SAP in Tanzania


  $143 million from the World Bank to Tanzania in return of privatising their water serivces.

  British-led company City Water supplied water and implamented bills

  The poorest families were disconnected and had to revert to collecting unsafe water
• How did Tanzania stop the SAP


  Contract was cancelled in 2005

  In 2012 the Indian government gave $178 million

  Countries are shifting from Bretton Woods institutions to global superpowers such as India and China for help
• Criticisms of the IMF


  Severe welfare and education cuts in funding
• the Washington Consensus


  The USA had disproportionate influence at Bretton Woords

  all World Bank presidents have been American

  World Bank and IMF have their HQ in Washington DC

  The USA have a larger share of voting rights, x3 the voting shares than the second most, Japan
• Hegemonic power


  soft strategies using diplomacy, aid, media, and education
• Criticisms of the WTO


  -economic influence from wealthier states provides an advantage

  wealthier states provide tarrifs and rules e.g. the EU subsidises its farmers

  -some of the poorest, most conflict-ridden states are not members e.g. South Sudan, North Korea

  -descisions must be unanimous amongst 164 members

  -free trade can be detrimental to some businesses e.g. cocoa farmers in Côte d'Ivoire