The globalization of business has shaken up financial institutions, the labor market, popular culture and politics from nation to nation throughout the world. Indeed, it is hard to find an aspect of life that globalism had not affected. While it doesn’t look like globalization will end in the near future, protests against it are many and the protestors varied. Some have aimed to make globalism friendlier through “localization”, which involves adapting products to fit into regional cultures.
Evidence for the existence of the trends of globalization and localization can been seen throughout relevant media. One Financial Post Business Magazine article points out that twenty years ago, Canada had a ribbon-cutting ceremony when Canada opened its first ATM network and a vice president made the first ATM withdrawal from a foreign country. Two years later, Canada signed its referendum on free trade. Since that time, ATMs have become commonplace. Meanwhile, over 200 million people work outside of the country of residence. This, the author says, shows how much has changed in twenty years, because of globalization (Banks 2008).
Banks also points out how deeply globalism has affected the world. He points out that everyone from domestic caregivers to top level executives have mobilized in mass, either to become more successful or just to survive. Localization, while it is not as widespread as globalism, is naturally increasing as well. Indeed, in the United States
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In addition to meeting the challenge of localization, globalists must meet other new challenges. Many, for instance, face problems related to transportation. Transportation has become more challenging than ever in recent months, as the price of fuel has risen. Fortunately, some successful businesses are willing to share their ideas with others. Last month, for instance, i2 held a conference regarding global transportation, which focused on logistics, creating new models of delivery, balancing costs and taking risks (Business Wire 2008).
However, some are more positive about each trend than others. For instance, John Schmid of The Milwaukee Journal Sentinel argues in an October 7 article, that anti-globalists attitudes might be hurting Midwesterners. Schmid believes that, because business is becoming more and more dependent on foreign relations, an anti-trade attitude among mid-westerners will hurt their pocketbooks. Schmid says such attitudes do not make sense when there is an increased demand for US goods in the world (Schmid 2008).
Meanwhile, in India, protests against globalism and its affects are quite loud. One of its automobile companies, Tata Motors, has created an automobile that will cost just over $2000. This makes it affordable for those who are not well off and gives India a chance to compete in the global market, but political opponents and farmers who are upset over the environmental impact of such a move have chased the company out of West Bengal. Nevertheless, those who are in favor of trade and industrialization have set aside well over 400,000 acres of land as a special, business-friendly economic area (The Economist 2008).
Perhaps one of the most dangerous aspects of globalization is that, because it makes countries interdependent, bad economic news for one country often means bad economic news for the others. As Americans begin to feel the effects of a recession, so too does China. Indeed, according to The Economist, even though only a few thousand companies will actually declare bankruptcy, many more will. This is become material has begun to cost more, trading partners are not demanding as many exports, and because labor laws have become more strict. All of these things are very closely related to globalization. Americans pinching pennies, for instance, are less likely to buy as many cheap toys for their children. Because Chinese workers make most of the toys children in America buy, Chinese workers lose some of their income. Indeed, over 30 companies that are traded on the national stock markets have failed (Bankruptcy in China: Silent Busts 2008).
China is not the only country that may suffer from dependence on foreign trade. India too will hurt. India relies a great deal on American outsourcing, but as American spending declines, and American businesses begin to fail, outsourcing projects decrease. To be sure, companies like Tata Consulting, which recently secured a two-and-a-half million dollar deal with Citigroup are doing well for themselves, but other companies are seeing a marked slowdown in profits (In a pinch: How the financial crisis will affect the outsourcing industry 2008). Nevertheless, globalization has helped India enormously. Indeed, according to World Bank President Robert Zoellick, globalization has helped people in India, Africa, Brazil and China escape poverty. So, while the slowdown in outsourcing may hurt India, its involvement in the global marketplace has left many better off than they would have been without international interaction (World: Globalization offers tremendous benefits, says Zoellick 2008).
Countries considered “developed” are also hurting. Ireland’s economy, which many have looked at as an example of success, is now in a recession. Michael O’Sullivan sees hope for a bright Irish future if the nation regains its competitive spirit and holds back from bailing out banks, rather than following the American example, it may, at least according to O’Sullivan, prove that The Celtic Tiger is once again a model worth following. Perhaps one of the hardest challenges for Ireland, says O’Sullivan, will be to get the Irish people to stop demanding such high wages and expensive lifestyles. These have likely been fostered by globalization. It is harder for people to be satisfied with what they have if their trading partners have a great deal more. Portugal and the Czech Republic face similar problems (O’Sullivan 2008).
Bankruptcy in China: Silent Busts. (2008, October 9). Retrieved October 9, 2008, from The Economist Web Edition: http://www.economist.com/business/displaystory.cfm?story_id=12380989
Banks, B. (2008). Where Do The Dollars Go?; Globalization isn’t just about the movement of corporations. It’s also about the incredible flow of people. And their money. National Post , 15.
Business Wire. (2008). i2 to Present Strategies for Overcoming Global Transportation Challenges During Council of SupplyChain Management Professionals Annual Conference. 11:34.
BusinessWire. (2008, October 1). Genes to Jeans: Agribusiness Localization Session to be featured at Localization World in Madison,Wisconsin, October 13- 15, 2008. 10:25.
In a pinch: How the financial crisis will affect the outsourcing industry. (2008, October 9). Retrieved October 9, 2008, from The Economist Online: http://www.economist.com/business/displaystory.cfm?story_id=12376813
O’Sullivan, M. J. (2008, Oct. 1). The Future of the ‘Celtic Tiger’ Model. The Wall Street Journal , 13.
Schmid, J. (2008). Trade fears may hurt Midwest, study says Survey finds attitude of isolation stronger here. The Milwaukee Journal Sentinel , d1.
The Economist. (2008, Oct. 09). A new home for the Nano. Retrieved October 9, 2008, from http://www.economist.com/business/displaystory.cfm?story_id=12381021
World: Globalization offers tremendous benefits, says Zoellick. (2008, Oct. 13). Thai News Source .