CORONA ENGENDERS INFIGHT AMONG THE PROPONENTS OF GLOBALISATION
Dr.Dileep M.R., Article published in The College Teacher. October 2020.
The US, after reeling under shortage of medical supplies and being proved inefficient in containing the worst-hit pandemic of the era, makes a hue and cry on China’s atrocities.
In the wake of a century’s worst crisis, the ill-effects of globalisation popped up so badly in order the proponents of the same to engage in proxy war.
Ironically, Corona pandemic turned to be an eye-opener for the West as they reel under shortage of medical supplies at a crucial juncture. The Chinese domination in the supply of goods across the world caused much worries for the proponents of the Globalisation, particularly the US. As the ire among the people in the West against the undue dependence for medical supplies to China is on the steady increase, the leaders started blame game and mudslinging. The president of the so-called most powerful nation in the World, the US, makes unwarranted remarks on China’s atrocities. Here comes the most important aspect to point out: the rapid rise China as a global leader of manufacturing is indeed due to globalisation as well. Moreover, the rapid spread of this current pandemic itself is also a by-product of globalisation since excessive movement of people for trade is the prime cause of the spread of the Covid-19.
Globalisation is certainly a double-edged sword. Amidst a range of benefits, there are severe consequences as well that are sidelined/neglected by the Capital-loving leaders and nations. Globalization paves the way for the manufacturing of goods wherever the cost of production and resources is the lowest and then to the free flow of them across the borders. Having aplenty of cheap human and other resources, China got the advantage and the transnational business giants moved into China for making the goods at the lowest cost. Thus, health products were also started to produce in China, which offered production of almost very items probably at very low cost. Naturally, other nations depended on China for the products at lower rates, and now, at the time of a real and devastating crisis, they realised the consequences. Let’s peep into the after-effects of Globalisation in general.
It was towards the end of the last century, the new trend in globalization became so pervasive that reshapes the world economy, while unveiling new, anticipated and unanticipated occurrences that would alter many of our established norms. As the new economic order is in place, Capital has utmost significance and the control of economies in almost all societies across the world in the hands of some international business giants. The borders of the countries became insignificant for the flow of goods in and out of the countries. Moreover, the global market is increasingly being in the hands of some global transnational corporations which have incredible investment capability, even more than some of the sovereign countries in the world, and hence the trend is more of a kind of corporate globalization.
As China and similar nations offered production space, resources and capacity at the lowest rates, transnational corporations rushed into China for taking the advantages. China too got developed own corporations that could become global firms. Sooner, China became the hub of global manufacturing and the rest of the world started to enjoy the luxury of making in China at a lower cost. The extreme consumerism, another outcome of excessive globalization already caused severe environmental, social and cultural repercussions. While the West blame China for widening holes in the Ozone layer as a result of emissions due to manufacturing of goods and products, they were also enjoying the luxury of consuming cheaper products that were being imported from China and other similar nations which could manufacture at lowest rates.
What does globalization give?
Globalization with its inherited and intriguing possibilities of consequences also offers a range of advantages. Economic growth is one of the most visible indicators of its effects. As the countries get increased amount of investment and inflow of funds from abroad, the economy will see growth and dynamism immediately along with enhancement in the overall efficiency. Increase in employment opportunities is another benefit the recipient can enjoy. The pervasiveness of globalization creates Open societies and economies in which a freer exchange of goods, ideas and knowledge will take place. That will enable the economy to be dynamic. Furthermore, entrepreneurial activity enhances along with innovation and increased rate of creativity in the business sectors. Moreover, due to the increasing rate of information technology use, the people become more aware of their rights and identities. On top of them, the intellectual property rights (IPR) are increasingly intact due to the strict regulations being imposed upon.
While the products are manufactured wherever it is most convenient to do so will make the possibility of ‘economy of scale’ maximum. Production in large quantity certainly reduces the production cost substantially. Global sourcing enables easy availability of cheapest materials, as well, so that the production cost can be reduced further. Benefit is also there from manufacturing of products in less regulated environments where business resources are cheaper and easily available. Standardized products will become available for the communities in most of the economies world over and local business infrastructure gets multiplied. Moreover, supplementary and associated business will also flourish which will have cascading effects throughout the economy. Another benefit is that the products manufactured in a country get a wider market beyond boundaries. In general, the greater the growth, the higher the per capita income would be at the national level.
.The growing concerns of corporate globalization
A brief on major consequences of excessive globalization is following.
The threat to sovereignty and denationalization
One of the major concerns is all about the growing power of transnational corporations and the consequent threat being posed to the sovereignty of countries. Globalization offers the prospect of a world that will be controlled by these new economic forces. A few hundred giant corporate entities march towards global financial control spearheaded by the capital as prime instrument. One of the primary targets of globalization is indeed the creation of a global market in which the significance of state boundaries fades away. In this process, the internationalization of national economic spaces through growing penetration (inward flows) and extraversion (outward flows) will take place. It can sweep away regulations and undermines local and national politics, just as the consolidation of the nation state swept away local economies, dialects, cultures and political forms. The expansion and deepening of multi nationalism with the prevalence of transnational corporations while getting support from global norms and standards always loom large over sovereignty of countries. In some cases, it can even influence in shaping the destiny of various countries especially that belong to economically disadvantaged of less developed countries.
Super national institutions such as World Trade Organization (WTO) and International Monetary Fund (IMF) are backing the global march of those corporations with the required rules and regulations that have global legitimacy. Some of the former third world countries could gain much from the globalization process. At the same time, most of the poor countries have sunk deeper into poverty, as happened in some African countries. Moreover the divide between the rich and the poor countries is getting widened. Policy modification is another important aspect of growing globalization. As the market power go beyond the reach of national governments, the large transnational corporations generate a formidable lure and appeal among the policy makers and developers in order to have favourable policies to create a convenient business environments and attempt to ease out regulatory restrictions towards free flow of business resources such as money, labour and the products in and out of the countries. In the meanwhile ample pressure would be there on authorities to make necessary modifications to attract international investment and foreign direct investment (FDI).
This will be possible only when the national and local interests of the people and environment are sidelined especially those related to the welfare measures and environmental regulations. It is widely seen now a days that the authorities are increasingly being deprived of freedom in terms of the action they are able to take in cruc ial areas such as labor and environmental legislation. In addition to sideling or removing the trade barriers, governments have to avoid the regulations that protect local labor, the practice of giving subsidy to the fledgling or primary industries and trade protectionism. Transnational Corporations will see that the required labour can be imported or exported at will.
Loss of own land and depletion of resources The permeating globalization leads to increased demands for critical, finite natural resources which ultimately lead to resource crunch which is a pressing reality. The increasing global competition for natural resources is a concern and in the wake of Globalization, not just market, but geopolitical forces are being pressurized to ensure continued supplies and controls over critical resources. The resource utilization issue is more severe since the production rate is increasing so fast. Moreover, transnational firms are in a hurry to find out locations where they can make the products cheaply. This lead to the identification of poor countries where they can have production smoothly and cheaply and the same poses consequences such as over exploitation of resources and disregarding of the local interests. Moreover the value of the resources is usually undermined while highlighting the statistics of growth and development which is rarely deep rooted or comprehensive. Its already an issue that globalization has dislocated traditional livelihoods and local communities, and threatens cultural diversity.
Imbalance and inequalities
Globalization impacts countries in varied manner as not all regions are affected equally. The developed regions certainly take the advantages more. Immense riches are being generated. But fundamental problems of poverty, exclusion and inequality persist in spite of the scope for more economic dynamism. Further, corruption is observed to be increasing, particularly among the so called third world countries. Globalized production process is in place, and yet global poverty still remains a hard nut to crack. Women, indigenous peoples, and the working poor without skills and assets, are among the most vulnerable. Unemployment and underemployment remain stubborn realities for the majority of the world’s population. Many reports indicate that poverty in sub-Saharan Africa is still on the increase though that region has been exploited under the globalization process. Welfare of the people is at stake in many occasions when decision making is undertaken to favour the incoming corporations. There is imbalance in the global rules.
Economic rules and institutions prevail over social rules and social institutions, while the effectiveness of existing rules and institutions themselves are being tested by current global realities. Furthermore, it has to be noted that the poorer societies do not possess the capabilities and assets needed to enter into productive economic transactions internationally. The traditional labour forces are endangered now. Migration of labour from traditional sector to the glamorous jobs gained speed. This directly impacts the traditional sectors by missing skilled labour and in turn leads to increase in production cost and eventually those sectors may face severe existential crisis. Furthermore migration of people from rural to urban areas as well as from one country to another country is also increasing.
Structural change, without necessary social and economic provision for adjustment has brought in uncertainty and insecurity to workers and businesses that prevailed in third world societies. As some countries progress fast, the inequality between countries widens further. On top of them, the inequality inside countries is also on the increase. It effects on people, families and communities. The gap between the poor and the rich is widening further. Hence it can be summed up that three kinds of inequalities are there such as: inequality among people within nations, inequality between nations and inequality at global level among people. Moreover the bargaining power the labour is lost as the authorities are liberalizing the labour policies continually to attract external economic forces. Besides, outsourcing has weakened the labour sector. Permanency character of the employment is at stake and instead contract based temporary job culture is increasing.
Environmental hazards
With its unrestrained pursuit of profits across the world, the tyranny of capital in the form of globalization is certainly a major contributor to environmental deterioration. The global firms try to create more demand, and new products are created to increase transaction and sale. This leads to unsustainable use of resources. At times governments have to relax environmental policies and regulations in favour of the interests of international forms in order to attract them for investment. One important aspect to ponder is the indifference of transnational corporations to the environmental values and sensitivity of local regions. All other sorts of environmental consequences of manufacturing will increase along with the surge in production and consumption at a global scale.
Homogenization
Homogenization of culture is gaining strength along the progress of globalization. Structures of modernity (capitalism, industrialism, etc.) are spreading world over, destroying cultures and local self-determination in the process. Third world countries are rich with cultural diversity. But in the process of globalization, the mighty culture invades local culture and slowly becomes the part of the culture over there. The western culture is getting more and more acceptance in all the societies and the other cultures are getting less significance. Everyone conforms to western ideal which causes the loss of individual cultures and religions. The cultural diversity existed in many third world countries are endangered now. The modern societies are in many respects increasingly standardized, predictable, and uniform and the term ‘McDonaldization’ is widely used to refer this phenomenon. It does not have a bearing that the whole world will become a single cultural world, yet certain elements of day to day cultural life are getting common in many societies and the spread of such is rapid.
Conclusion
The world has seen the repercussions of excessive globalization and consequent surging consumerism in myriad ways. Its latest version is seen when the most powerful economic giants enter into proxy war and mudslinging. Some of the powerful economies have realized the issues of the ill-effects of globalization well. When the blame from their own people emanated, they, led by the US, started blame game among them. It’s high time to have a rethink to minimize the impacts and manage the globalization process in a controlled way.
References and bibliography
? Ankie Hoogvelt, 2001, Globalisation and the Post-colonial World, Palgrave: Hampshire.
? David a Deese, 2012, Globalisation-Causes and Effects, Routledge: London.
? Rak Keily, 2005, The Empire in the Age of Globalisation, Pluto Press: London.
? Spencer Zifcak, 2005, Globalisation and the Rule of Law, , Routledge: London.
? Jens-Uwe-Wuderlich, 2007, Regionalism, Globalisation and International Order,
Ashgate: Hampshire.