Trade and Globalization

Trade and Globalization

Main Idea

Trade and culture link economies and lives around the world.

Reading Focus

• How does economic interdependence affect countries around the world?

• What are some patterns and effects of global trade?

• How does globalization lead to cultural exchange?

Economic Interdependence

At the beginning of the twenty-first century, the world was divided over a number of political, cultural, and economic issues.

Globalization

• Despite divisions, countries tied together like never before •

Globalization

is force behind closer relationships – Process in which trade, culture link countries – Improvements in transportation, communication make global trade easier

Interdependence

• Major effect of global trade, increased economic

interdependence

– Relationship among countries in which they depend on each other for resources, goods, services – Occurs because countries vary in goods, services they provide, need

Developed and Developing Countries

Economy

• Goods, services nation provides and needs depend on level of economic development in that country • Countries grouped in two categories: developed, developing

Developed

• Industrialized nations have strong economies, high standards of living • 20 percent of world’s nations wealthy, powerful like Japan, United States • Have access to good health care, education, technology

Developing

• Less productive economies, lower standard of living; Guatemala, Philippines • People in these countries lack adequate education, health care • Poorest, least-developed countries located mostly in Africa, southern Asia

Growth and Outsourcing

Multinational Corporations

• Increasing interdependence and dramatic growth of

multinational corporations

—large companies operating in multiple countries • Benefits to companies –

Outsourcing

production —having work done elsewhere to cut costs, increase – Manufacturing facilities in developing countries, where materials, labor relatively inexpensive • Outsourcing – Advocates say: creates jobs and wealth in developing countries – Critics say: fails to improve standard of living, outsourcing causes job loss in company’s home country

Global Economic Ties

• Certain events, actions can affect economies of many nations • Global interdependence particularly evident in times of uncertainty – Early 2000s, price of crude oil rose dramatically – Factors: rising world demand, concern over available supply

Oil Prices

• All countries depend on oil for energy; rise in prices felt around world • Developed countries like United States faced with higher costs • Poor nations in Africa could not afford to import, faced shortages • Rise in oil prices led to increased demand for alternative energy sources, attempts to reduce consumption

Summarize

How does economic interdependence affect the world?

Answer(s):

helps to provide jobs in developing countries, increases production and decreases cost for multinational companies

Global Trade

Globalization often leads to or promotes

free trade

, the exchange of goods among nations without trade barriers such as tariffs. This can lead to consumers purchasing higher-quality goods at lower prices.

GATT, WTO, OPEC Regional Trade International Trade Organizations

• Many of these groups work to promote, regulate free trade • 1948, General Agreement on Tariffs and Trade (GATT) • Worked to limit trade barriers, settle disputes • 1995, GATT replaced by World Trade Organization (WTO) • Monitors national trade policies • Organization of Petroleum Exporting Countries (OPEC) works to control oil production, price • Regional trade blocs promote free trade, deal with economic issues of neighboring nations • European Union (EU), North American Free Trade Agreement (NAFTA), others

Effects of Global Trade

Benefits

• Global trade has clear benefits • Developing countries can provide new, valuable markets for goods, services produced by developed countries

Anti-Globalization

• Opponents argue process benefits wealthy developed nations at expense of developing nations • Free trade encourages practices that exploit workers, destroy environment • Technology, services, money from developed nations can improve public services, raise standard of living of developing countries • Some promote fair trade, like fair trade coffee movement guaranteeing fair prices to coffee bean farmers

Find the Main Idea

How does global trade affect the world?

Answer(s):

can provide opportunities for developing countries; opponents believe global trade exploits developing nations, supporters believe it provides for the production and sale of high-quality, low cost goods

Cultural Exchange

Culture

• Globalization; countries linked through trade

and

culture • Modern transportation, communication allow faster exchanges of ideas, customs

Popular Culture

• Globalization leads to changes in

popular culture

• Culture traits: food, sports, music common within group of people

Spread of Traits

• Globalization leads to

cultural diffusion

, spread of culture traits from one region to another • Work, travel, permanent moves all play part

Mass Media

• Television, movies, music most powerful methods of cultural diffusion • Satellite news and Internet also ways of exchanging images, ideas

Effects of Cultural Changes

Negative Effects

• Some believe changes largely negative • Mass media, advertising encourage growth of consumerism, preoccupation with buying consumer goods

Media

• Opponents say market shaped by media and advertising, not actual needs • Worry that globalization creating common world culture, allowing traditional cultures to lose uniqueness

World Community

• Globalization linking people together through economics, culture • Challenge to preserve valuable traditional cultures while providing enrichment from other places in world

Summarize

How is cultural exchange a part of globalization?

Answer(s):

leads to cultural diffusion, more travel to other countries for work or vacation, exotic goods from other countries available

Social Challenges

Social Challenges

Main Idea

People and countries are working together to protect human rights, help solve problems such as poverty and disease, and adjust to new patterns of migration.

Reading Focus

• How are individuals, groups, and nations working to protect human rights?

• What global challenges do people around the world face?

• What are the causes and effects of population movement?

Human Rights

Globalization and Human Rights Statements on Human Rights

• Violence, human rights abuses not new • Globalization has made world more aware • In recent years, many nations have pledged to respect human rights • 1948, United Nations issued Universal Declaration of Human Rights • All people deserve basic rights “without distinction of...race, color, sex, language, religion, political or other opinion, national or social origin, property, birth or other status” • 1975, Helskini Accords signers agreed to respect human rights

Human Rights Abuses

In spite of agreements, torture, slavery, killing, other abuses daily occurrences in some countries

•

Most common in countries not democracies or in process of establishing democracy

•

Some groups at greater risk than others

– People who disagree with their government – People who are members of religious, ethnic minority – Women and children

Working for Rights

• Many individuals, groups working to improve, protect human rights • United Nations investigates human rights abuses, works with national governments to protect rights of threatened groups • Also

NGOs

, nongovernmental organizations, formed to provide services, promote certain public policies

Protecting Human Rights

• International Red Cross, an NGO that works to improve welfare of women, children, indigenous peoples; played key roles in fights against slavery, violence against women, apartheid • Human rights usually better protected in democratic countries • Spread of democracy has led to spread of human rights

Make Generalizations

How are human rights threatened and protected?

Answer(s):

threatened —torture, slavery, and killing; protected —actions of United Nations, NGOs; increased democracy, globalization

Global Challenges

Although globalization is improving the lives of some people, many still face major challenges like poverty, disease, or natural disasters.

Poverty

• More than 20 percent of world’s people live on less than $1 per day • Poverty has many causes – Lack of natural resources – War – Poor government planning – Rapid population growth • One result—

famine

, extreme shortage of food

Disease

• Globalization has made controlling disease challenge for entire world • International air travel allows disease to spread rapidly • 2002, SARS pneumonia appeared in China, spread to Asia, Europe, Americas • Hundreds killed in

epidemic

, contagious disease outbreak

Epidemics

• HIV/AIDS another recent

epidemic

– Over 25 million have died from AIDS since 1981 – Millions more infected by the disease • International health organizations, local governments have had some success controlling spread of some diseases – Education about prevention of disease – Making medicines cheaper, more available

Natural Disasters

Worldwide Events

• Hurricanes, earthquakes, floods also affect many areas of world • Natural disasters cause deaths, destroy homes, businesses

Aid to Regions

• December 2004, tsunami devastated large areas of Southeast Asia, killed over 225,000 people • Many individuals, governments, humanitarian organizations provide aid to regions hit by natural disasters

Summarize

What are some of the challenges facing people around the world?

Answer(s):

poverty, disease, natural disasters

Population Movement

The movement of people around the world has increased dramatically in recent years. Some people move in search of better opportunities, while others are

refugees

, seeking safety in another nation.

Migration

• Many factors cause people to migrate to a new place • Some “push” people to leave homeland • Others “pull” people to new places

Push, Pull Factors

• Push factors that displace people: – War – Persecution – Poverty • Pull factors include opportunities for jobs, better life

Globalization

• Migration changed by globalization • Migrants can quickly travel far from home • Can settle in places very different • Mixing of cultures can be dramatic

Population Movement

Return to Homelands

• Migrants often able to return, visit native countries • Easier to retain own cultures, languages, habits • Typical destinations, wealthy developed North American, European nations

Results of Migration

• Often migrants find work, provide better life for selves, families • Sometimes fail to find jobs, face discrimination in new countries • Some think newcomers will take away jobs, services from native citizens

Urbanization

• Migration also within countries; people moving from rural to urban areas • Fastest growing cities in developing countries, slower in developed countries; rapid urbanization main factor in worldwide population movement

Find the Main Idea

What are some main reasons for population movement?

Answer(s):

to escape war, persecution, poverty; search for better jobs, education, better life