B E CHPTR 3 GLOBALISATION Globalization is an elimination of barriers to trade, communication, and cultural exchange.

The theory behind globalization is that worldwide openness will promote the inherent wealth of all nations. Globalisation is a process where an increased proportion of economic, social and cultural activity is carried out across national borders. The process of globalisation has significant economic, business and social implications. The worldwide movement toward economic, financial, trade, and communications integration. Globalization implies the opening of local and nationalistic perspectives to a broader outlook of an interconnected and interdependent world with free transfer of capital, goods, and services across national level.

Explain the relation between globalisation, privatisation and liberalisation

Globalization as the free flowing of capital between nation states and continents- i.e multilateral trade and investment in economies by other economies. Globalization tends to lead to greater privatization, practically all nations involved in increased globalization (read as increased potential of multilateral trade and investment) and who have valued institutions that have been run by the public sector , will tend to privatize these institutions be they banks/ every companies or whatever. This is because if there is increased globalization there is increased investment in and in demand for valuable products/organizations. Often governments have run these institutions poorly in the past and are keen to sell off to the highest bidder. Liberalization is both an associated cause and effect of globalization--I will illustrate with an example. In order to increase investment and commerce within their country, New Zealand had to liberalize their economy, I.e. the deregulated the labour market( e.g. less rules and regulations on employers re employee rights/ pay rates etc, less union power ), cut tariffs for goods coming into the country. This provided the incentive for increased international investment and capital flow to NZ, hence when this started to occur nz was more 'globalised'.

Also liberalization is an effect-- once globalization is entrenched- it requires reasonably liberal economy with lesser restriction on labor market/ . Tax/tariffs-to sustain the growing economy. Also industry lobby groups are active in pressurizing governments for liberal policies re there industries interests (e.g..no increase in minimum wages). Basically we can describe globalization, privatization , liberalization in a circular flow diagram , with liberalization usually being the starting point with globalization and privatization coming next in either order.

OBJECTIVE OF LIBARALISATION
To facilitate cooperative arrangements. Cooperative arrangements in the enviromental sector give governments the ability to work togheter to promote global issues including enviromental issues.

Understand the history, purpose, and impact of the World Trade Organization. Explore the pros and cons of globalization, especially in relation to its impact on developing countries. Develop research, presentation, writing and conflict resolution skills that can be applied to numerous other content areas and case studies.
An expansion of trade in goods and services between countries. An increase in transfers of financial capital across national boundaries including foreign direct investment (FDI) by multinational companies and the investments by sovereign wealth funds. Shifts in production and consumption e.g. the expansion of outsourcing and off shoring of production and support services. Increased levels of labor migration It helps to simplifies the process to start a business . It helps to reduce excessive regulatory frame work

The removal or reduction of restrictions or rriers on the free exchange of goods between nations. This includes the removal or reduction of both tariff (duties and surcharges) and non-tariff obstacles (like licensing rules, quotas and other requirements). The easing or eradication of these restrictions is often referred to as promoting "free trade." Those against trade liberalization claim that it can cost jobs and even lives, as cheaper goods flood the market (which at times may not undergo the same quality and safety checks required domestically). Proponents, however, say that trade liberalization ultimately lowers consumer costs, increases efficiency and fosters economic growth.