INTL 101: INTRODUCTION TO GLOBAL POLITICS

1. INTL 101: INTRODUCTION TO GLOBAL POLITICS Is Economic Globalization a Positive Trend?

2. LECTURE CONTENT • Key Concepts • Argument for the Economic Globalization as a positive trend. • Is Economic Globalization a Positive Trend? YES • Argument against the Economic Globalization as a positive trend. • Is Economic Globalization a Positive Trend? NO

3. Key Concepts • Competition- in economics, rivalry (competitiveness) in supplying or acquiring an economic service or good. • Economic development- the combined process of capital accumulation, rising per capita incomes (with consequent falling birth-rates), the increasing of skills in the population, the adoption of new technological styles, and other related social and economic changes. • Economic growth- the steady process by which the productive capacity of the economy is increased over time to bring about rising levels of national output and income. • FAO- Food and Agriculture Organization of the UN.

4. Key Concepts • Free trade- the flow of goods and services across national boundaries unimpeded by tariffs or other restrictions. • GMO- Genetically Modified Organisms-is an organism whose genetic material has been altered using techniques in genetics generally known as recombinant DNA technology. • Government intervention- used to describe any activityundertaken by a central government in an effort to affect a country's economy. • IMF- International Monetary Fund. • Malnutration- the lack of needed foods including protein and vitamins.

5. Key Concepts • MFN Concept- Most favoured nation- the principle that one state, by granting another state MFN states, promises to give it the same treatment given to the first state’s most-favoured trading partner. • Multinational corporations (MNCs)- companies based in one state with affiliated branches or subsidiaries operating in other states.

6. Key Concepts • NAFTA- North American Free Trade Agreement. • Regional integration- the process whereby territorial based subsystems increase their level of interaction (EU,NAFTA etc.). • RTAs- Regional Trade Agreements. • Tariff- a duty or tax levied on certain types of imports (usually as a percentage of their value) as they enter a country. • Trade barrier- is general term that describes any government policy or regulation that restricts international trade. • Trade liberalization- removal of obstacles to free trade. • WTO- World Trade Organization.

7. Argument for the Economic Globalization as a positive trend. • Anne O. Krueger, first deputy managing director of the IMF , argues that growth of economic globalization is the best approach to improving the economies of Africa and, by extension, other countries as well.

8. Is Economic Globalization a Positive Trend? YES • Economic Globalization is a positive trend because: • Trade liberalization has positive effect on economic growth: • No country has achieved the sustained rapid growth needed to reduce poverty without opening up its trade with the rest of the world.

9. Is Economic Globalization a Positive Trend? YES • Multilateral trade liberalization means all countries acting together to lower their trade barriers against each other that created the environment in which trade has grown rapidly , and driven global growth.

10. Is Economic Globalization a Positive Trend? YES • Trade liberalization brings competition. It enables producers to have access to inputs at the lowest possible prices. • Trade liberalization provides reduction and removal of both tariff and non-tariff barriers.

11. Is Economic Globalization a Positive Trend? YES • Although multilateral liberalization provides the greatest gains, the benefits of trade liberalization are significant even when it is done unilaterally on a MFN principle. • Example: Korea and Chile. • Barriers imposed by developing countries on each other are higher than those imposed on them by industrial countries.

12. Is Economic Globalization a Positive Trend? YES • Trade liberalization results in more economic growth. • There will always be some losers and winners, but there is more gain from trade liberalization. • Generally protected but inefficient industries will find way of adjusting to the circumstances. • Example: Case of Mexican refrigerators manufacturer during NAFTA negotiations.

13. Is Economic Globalization a Positive Trend? YES • Full participation in a growing world economy is key if countries are to experience the rapid growth needed to reduce poverty on a significant scale. • It is not enough to lower tariff barriers among the members of an RTA.

14. Is Economic Globalization a Positive Trend? YES • RTAs are not most effective way of economic success without multilateral trade liberalization. • Example: The case of Africa. • The economic success of the EU depends on the regional integration and trade liberalization with the rest of the world.

15. Argument against the Economic Globalization as a positive trend. • José Bové, a French farmer and anti-globalization activist, argues that multinational corporations, government leaders , and others are engaged in a propaganda campaign to sell the world on the false promise of economic globalization.

16. Is Economic Globalization a Positive Trend? NO • Economic Globalization is not a positive trend because: • Opposite to the free marketers’ beliefs, markets are unstable. Government intervention is needed to regulate the markets and to sustain the certain sectors such as farming.

17. Is Economic Globalization a Positive Trend? NO • Competition does not generate wealth to everyone. • Example: The case of farmers. • World market prices are not a relevant standard for guiding output. • Example: The world wheat market accounts for only 12% of overall output and international trade takes place at prices of the most competitive exporting countries.

18. Is Economic Globalization a Positive Trend? NO • Free trade is not engine of the economic development. • Living standards of farmers in the South-still low. • The link between agriculture and GMOs is an important debate.

19. Is Economic Globalization a Positive Trend? NO • There is pressure from US that genetically modified rice (known as golden rice) is going to feed people who are dying of hunger and protect them from all sorts of diseases. But this will noy solve the problem of vitamin deficiencies.

20. Is Economic Globalization a Positive Trend? NO • The way to fight malnutration is to diversify people’s diets. • Example: Jacques Diouf, Director General of FAO pointed out that to feed the 8003 million people who are hungary, there is no need for GMOs.

21. Is Economic Globalization a Positive Trend? NO • Three fundamental principles need to be address in the context of economic globalization: i) food sovereignty, ii) food safety, and iii) preservation of bio-diversity.