international modes of operations
Goods export & import
Service export & import
Investments
The Advantages of Globalization
- FDI
(tech transfer higher productivity and growth of global companies) - Job creation in host countries reciving FDI
(many of these “inward” investment jobs
are highly skilled cause inward transfer of technologies to host countries; skills then spread through the host economies) - Technology innovatoion
(Access to more info and new technology development, improving economic
output ( new products and more efficient processes) and environmentally friendly.) - Economies of scale
(Enables large companies to reduce costs, improve profits and reduce prices, but can hurt small businesses attempting to compete domestically) - Developement of weaker economies.
(Poor countries sell their goods and services to richer countries, opening them up for development and prosperity)
Criticism of globalisation:
- Threats to national sovereignty
(- National interests vs. proliferation (spread) of international agreements,
– Worker & environmental protection vs. competing with countries with less protection
– Small economies’ overdependence and inadequate capacity to deal with globalization
– Cultural Homogeneity) - Environmental stress
(More use of natural resources and carbon footprint vs. eco-friendly technologies and global cooperation) - Growing income inequality and personal stress
(Greater access to low-cost labour in poor countries has reduced the real wage growth of labour in rich countries and job opportunities)
Is regionalisation replacing globalisation?
NO
WTO suggests increase in
Regionalization trend during
2012 – 2016 but stabilization in
recent years. Resilience of Asian Exports and global Trade position
preventing further growth in regionalization.
Impact of Covid 19 on Globalization
Covid-19 blow to globalization has turned out to be much smaller than the decline caused by the 2008-09 global financial crisis
Factors impacting the future of globalization:
- Behavior of national governments
- Attitudes of consumers
- Mindset of executives and key stakeholders in
multinational companies - Economics of business globalization and supplychain management
- Emergence of Political and Trade conflicts
Further globalization is inevitable even with disruptive events such as Pandemics and Wars.
True or False
True
IB will grow primarily along regional lines rather than global lines
True or False
True
