How Does Globalisation Affect the Developing World?
Nathan Fry
Globalisation is “a process of interaction and integration among the people, companies, and governments of different nations, a process driven by international trade and investment and aided by information technology ”, and has a numerous both proponents and opponents. In theory it leads to universal economic prosperity and opportunity amongst developing nations. In China, where globalisation has had a big impact, the percentage of its population living on less than a dollar a day has dropped from 63pc in 1981 to 14pc in 2002, whereas in areas where globalisation has had little to no effect, such as Sub-Saharan Africa, poverty has increased from 41pc to 44pc .
The global market economy has doubtless increased the wealth of various countries, and lifted them out of poverty. Three decades ago Taiwan was poorer than many African countries are today with widespread malnutrition and few natural resources. Since then Taiwan has progressed to become as rich as Spain, poverty has been eradicated and wages are ten times as high due to their embracing of globalisation. The land which the government bought off the owners and gave to the people who worked on it was developed, and factories were built on it, which mass-produced cheap products for Western markets – “ugly blights on the landscape [but] a crucial stage ” to Taiwan’s wealth. Without these sweatshops – against which anti-globalisation protesters vehemently protest – Taiwan would still be poor today. Globalisation exposed the native Taiwanese companies to foreign competition, and so they had to be productive and innovative to grow, and compete for labour which caused wages to increase.
Vietnam is a country populated with so-called ‘sweatshops’, but just as in Taiwan, these are a necessary part of economic change. Over the last ten years the number of Vietnamese children in work dropped by 2.2 million as parents can now afford to send them to school due to the multi-national corporation building factories and providing new jobs; children being employed by the corporations as a source of cheap labour is an outdated myth. Working on the traditional farms of Vietnam can earn about half a million dong/month, whereas working in the factories can earn up to five times that amount; on average global companies pay eight times more than the country’s minimum wage. The local factories also benefit from the competition, as they are given incentive to grow, thus stimulating the economy.
In countries where globalisation hasn’t been accepted, such as Kenya, much of their populations live poverty. In Kenya, there has been no land reform as in Taiwan, and thus the people who work on the land do not own it, cannot develop it and have no incentive to make it profitable. And if they could develop it they would not receive the rewards as they do not own it.
Globalisation also helps to spreads ideas. 40 years ago Taiwan was a single-party state ruled over by Chiang-Kai Shek. When Shek died, the Taiwanese economy started to produce IT software and hardware, which were more valuable. The wealth which this generated created a middle class which wanted more freedom politically. Culture, too, is spread. While critics may comment on the ‘Americanisation’ of the world, culture exchange works both ways: cultural creations have also made their way to the developed world in various forms, for example, the myriad Chinese or Thai or Indian restaurants that exist. Language too: ‘pyjamas’ stems from a Hindi word, imported into the English Language.
However, despite the apparent economic prosperity brought about by globalisation, there is substantial opposition to it. “Members of the anti-globalisation movement…seek to protect the world’s population and ecosystem from…the damaging effects of globalisation.” These effects include: the loss of employment as industries unrequiring of sophisticated technology but needful of manual labour move from developed countries with worker’s rights and established minimum wages to poorer countries without this protection, the dismissal of national priorities in favour of multi-lateral aims by governments, the possible detrimental effects to domestic industries, by opening global markets, which are not fully developed enough to compete and the impact upon the environment as natural resources are being consumed at an increasing rate and as human activities cause lasting damage to the environment – for example CO2 emissions by the various forms of transport used to move goods and resources throughout the world – all in the name of ‘profit’ .
Noam Chomsky, anarchist and linguist, also has comments on the phenomenon. The book ‘Chomsky and Globalisation’ (Jeremy Fox, published 2006, Icon Books) sums up Chomsky’s key ideas thusly: “The US governments and major TNCs basically run the world to maximise American profits [By the war’s end the US had over half the world’s wealth and a position of power without historical precedent. Naturally the principle architects of policy intended to design a global system in their interests.
“The profit-driven global system seems indifferent to the problem of global unemployment. Wherever one looks there is work to be done of great social and human value, and there are plenty of people eager to do that work. But the economic system cannot bring together needed work and the idle hands of suffering people. It’s concept of economic health is geared to the demands of profit not the needs of the people.
“The global system used neo-liberal ‘reforms’ to bring Russia to it’s knees. A UNICEF enquiry in 1993 estimated that half a million extra deaths a year result from neoliberal ‘reforms’…25pc of the population has fallen below subsistence levels while the new rulers have gained enormous wealth.
“Prospects are dim for ordinary people all over the world through the possible erosion of the social contract. In Germany…workers have fairly reasonable conditions. So that has to be rolled back, and we have to go back to the days when we had wage slavery, as it was called by working people in the 19th century. No rights…If your children can’t make enough money to survive, they starve.”
In conclusion, globalisation and the exposure to the global market economy appear to be good things for poorer countries in general, allowing their population employment, provoking local companies into growth and stimulating the economy. Globalisation – especially the advent of global communications such as e-mail and the internet – also allows the spread of ideas and culture throughout the world. However, globalisation is a phenomenon which needs not to be left in the hands of the already-rich few, who can and do use it to exploit others and further their own ends.
