Globalization and its effects on developing world

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Globalization and its effects on developing world
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Outline

• What we understand by globalization
• Introducing globalization, and its
  characteristics. 
• Importance of Globalization
• Social Consequences of Market Globalization
• Globalization and economic development in Eastern
  Europe
• Globalization and economic development in Africa.

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GLOBALIZATION!
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What is Globalization?

• A Turkish national, receives a Master's degree in
  France, will work for an American registered
  company, which is based in China and started by
  an Italian....
• This is called GLOBALIZATION!

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Phases of Globalization!
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Has simply accelerated and gained complex
characteristics in recent decades.

• Globalization is not a new phenomenon early
  civilizations in the Mediterranean, Meddle East,
  Asia, Africa, and Europe have all contributed to
  the growth of cross-border trade over time.

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Importance of GLOBALIZATION!

• Law of Competitive Advantage...
• (Because of Trade Liberalization)

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Openness(ExIm)/ GDP

• Netherlands 99
• Canada 70
• Germany 56
• South Korea 53
• Norway 49
• France 43
• UK 39
• US 22
• Japan 18

• Economics at the World Bank have found that
  economic growth rates are closely related to the
  openness to trade, education, and communication
  infrastructure.
• Source IMF

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Social Consequences of Market Globalization!

• Loss of National Sovereignty  
• Off shoring and the flight of jobs
• Effect on the Poor
• Effect on the Natural Environment
• Effect on the National Culture

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Eastern Europe
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Obstacles encountered by EE countries. 

• Lack of standardized business accounting
  knowledge   
• Lack of practical applications on education
• Coping with the competition from Asia
• Too much government interference
• Prevailing role of government in contracting
• Cultural and language barriers

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Market access-the most important factor
considering FDI

• Globalization come to Eastern Europe mainly
  through FDI.
• The factors helping in reaching the markets of
  Eastern European countries, may well be tax
  advantages offered to foreigner investors.
• Corruption in Privatization.

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Savings in Labor and Material costs
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CEE advantages vs China in many industries