Development » Globalization processes and impacts

What you'll learn this session

Study time: 30 minutes

The meaning and characteristics of globalisation
How globalisation processes have developed over time
The economic, social, political and environmental impacts of globalisation
Case studies of globalisation in action
The winners and losers in a globalised world

Introduction to Globalisation

Globalisation is one of the most significant processes shaping our world today. It affects everything from the food we eat to the clothes we wear, the music we listen to and the jobs available in our communities.

Key Definitions:

Globalisation: The increasing connections between places and people across the planet, establishing a single global society.
Transnational Corporations (TNCs): Companies that operate in multiple countries.
Global supply chain: The worldwide network of producing, handling and distributing a product.
Outsourcing: When companies move parts of their business operations to other countries.

The Evolution of Globalisation

Globalisation isn't new, but it has accelerated dramatically in recent decades. Let's look at how it has developed:

📅 Early Globalisation (1400s-1800s)

The age of exploration and colonisation marked the beginning of global connections. European powers established trade routes and colonies worldwide. The trade of goods like spices, tea, cotton and slaves created the first global networks.

🚂 Industrial Globalisation (1800s-1945)

The Industrial Revolution accelerated globalisation through steamships, railways and telegraphs. This period saw the rise of international trade agreements and the first multinational companies.

💻 Modern Globalisation (1945-2000)

After World War II, international organisations like the UN, World Bank and WTO were established. Air travel, shipping containers and telecommunications made movement of goods and information faster and cheaper.

📱 Digital Globalisation (2000-Present)

The internet and digital technologies have created unprecedented global connections. Social media, e-commerce and digital services allow instant global communication and transactions. Data now flows across borders as much as physical goods.

Drivers of Globalisation

Several key factors have accelerated the globalisation process:

📶 Technology

Transport innovations (containerisation, air freight), communications technology (internet, smartphones) and digital platforms have shrunk distances and sped up connections.

💰 Economics

Free trade agreements, reduced tariffs, growth of TNCs and the search for new markets and cheaper production have driven economic globalisation.

📝 Politics

The end of the Cold War, rise of international organisations (UN, WTO, IMF) and policies promoting free trade have created a more connected political landscape.

The Impacts of Globalisation

Economic Impacts

Globalisation has transformed economies worldwide, creating both opportunities and challenges:

Growth of TNCs: Companies like Apple, Coca-Cola and Nike operate globally, with supply chains spanning dozens of countries.
Job creation and loss: Manufacturing jobs have moved from HICs to LICs, while new service sector jobs have emerged in HICs.
Economic growth: Countries like China, Vietnam and India have experienced rapid economic growth through globalisation.
Increased inequality: While global poverty has decreased, inequality within many countries has increased.

Case Study Focus: Apple's iPhone Global Supply Chain

Though designed in California, the iPhone's components come from over 200 suppliers across 43 countries. The phone is primarily assembled in China by Foxconn. Raw materials come from mines in Africa and South America. This global supply chain allows Apple to access specialist expertise and lower costs, but also raises concerns about working conditions and environmental impacts across multiple countries.

Social and Cultural Impacts

Globalisation has dramatically changed societies and cultures:

Cultural exchange: Global spread of music, film, food and fashion has created new hybrid cultures.
Migration: Increased movement of people between countries for work, education and better opportunities.
Westernisation: Some argue globalisation has led to cultural homogenisation, with Western (particularly American) culture becoming dominant.
Language changes: English has become the global language of business, with over 1.5 billion people speaking it as a first or second language.

Environmental Impacts

The environmental consequences of globalisation are significant:

Increased carbon emissions: Global shipping, air freight and international tourism contribute to climate change.
Resource depletion: Growing global consumption increases pressure on natural resources.
Pollution havens: Some companies move production to countries with weaker environmental regulations.
Environmental cooperation: Global environmental agreements like the Paris Climate Accord represent attempts at international solutions.

Case Study Focus: Fast Fashion and Globalisation

Companies like H&M, Zara and Primark represent "fast fashion" - inexpensive clothing produced rapidly in response to the latest trends. Cotton might be grown in India, processed in China, sewn in Bangladesh and sold in the UK. While this creates jobs in developing countries, it also leads to poor working conditions, high water usage, textile waste and carbon emissions from global transport. The 2013 Rana Plaza factory collapse in Bangladesh, which killed over 1,100 garment workers, highlighted the human cost of this global industry.

Winners and Losers in Globalisation

👍 Winners

Transnational corporations that can access global markets and cheaper labour
Consumers who can access a wider range of cheaper goods
Workers in emerging economies who gain manufacturing jobs
Highly skilled workers who can sell their expertise globally
Countries like China that have used export-led growth to develop rapidly

👎 Losers

Manufacturing workers in HICs who lose jobs to outsourcing
Local businesses that cannot compete with global corporations
Workers in global supply chains who face poor conditions and low wages
Traditional cultures threatened by homogenisation
The environment, through increased resource use and transport emissions

Responding to Globalisation

Different groups have responded to globalisation in various ways:

Anti-globalisation movements: Protests against organisations like the WTO, arguing that globalisation increases inequality and environmental damage.
Ethical consumerism: Buying Fair Trade products or locally-made goods to support better practices.
Localisation: Movements promoting local production and consumption to reduce environmental impacts and support local economies.
Government policies: Some countries have implemented protectionist measures to shield local industries from global competition.

Case Study Focus: COVID-19 and Globalisation

The COVID-19 pandemic highlighted both the strengths and vulnerabilities of globalisation. The virus spread rapidly through global travel networks and countries faced shortages of medical supplies due to disrupted supply chains. However, global scientific cooperation led to rapid vaccine development and digital technologies allowed many businesses to continue operating remotely. The pandemic has prompted many companies and countries to reconsider their dependence on global supply chains, with some moving toward "nearshoring" or "reshoring" production closer to home markets.

The Future of Globalisation

Globalisation continues to evolve, with several trends shaping its future:

Digital globalisation: Data flows and digital services are becoming as important as physical trade.
Changing power balance: The rise of China and other emerging economies is shifting global economic power.
Climate change responses: The need to reduce carbon emissions may lead to more localised production.
Automation: Robots and AI may reduce the importance of labour costs in production decisions.
Growing nationalism: Political movements in some countries are pushing back against aspects of globalisation.

As you continue your geography studies, remember that globalisation is not simply "good" or "bad" - it creates complex patterns of winners and losers and its impacts vary greatly between places and people.