What is Globalisation?

Globalization - the shift toward a more integrated and interdependent world economy

globalization can be defined as ” the increased interconnectedness and

interdependence of peoples and countries. It is generally understood to include two inter-
related elements: the opening of international borders to increasingly fast flows of goods,
services, finance, people and ideas; and the changes in institutions and policies at national and
international levels that facilitate or promote such flows. Example; I’m in Lagos state teaching
you in London, Uk.

Globalisation of Markets

Historically distinct and separate national markets are merging • It no longer makes sense to talk about
the “German market” or the “American market” • Instead, there is the “global market”.

However, it is important to recognize that significant differences still exist among national markets,
requiring companies to customize market strategies, product features, and operating practices to meet
the conditions in particular markets. E.g You want to sell a winter clothes in Nigeria where it is referred
to as a hot zone.

Digilisation has aided the growth of the global market.

Brands MTN, Glo, Dantoge refineries, Wizkid, Davido

Globalisation of Production

Firms source goods and services from locations around the globe to capitalize on national differences in
the cost and quality of factors of production like land, labor, energy, and capital.

Companies can:

> reduce their overall cost structure

> improve the quality or functionality of their product offering(goods and services they sell to the
public)

What is Driving Globalisation?

This simply refers to those things that aid or improves globalization.

1) Technological change: • microprocessors and telecommunications • Internet: information

backbone of the global economy • transportation technology

Global Institutions

• help manage, regulate, and police the global marketplace

• promote the establishment of multinational treaties to govern the global business system
>the World Trade Organization (WTO):

• Administering trade agreements • Platform for trade negotiations • Handling trade disputes •
Monitoring national trade policies

Location: Geneva, Switzerland

Established: 1 January 1995

Created by: Uruguay Round negotiations (1986- 94)

Membership: 164 members representing 98 per cent of

world trade Budget: 197 million Swiss francs for 2018

>the International Monetary Fund (IMF) 1945

an organization of 189 countries • working to foster global monetary cooperation • secure financial
stability • facilitate international trade

>the World Bank 1944

• promotes economic development via low interest loans for infrastructure projects

• has set two goals for the world to achieve by 2030: 1. End extreme poverty by decreasing the
percentage of people living on less than $1.90 a day to no more than 3% 2. Promote shared prosperity
by fostering the income growth of the bottom 40% for every country

>the United Nations (UN) 1945

• maintains international peace and security • develops friendly relations among nations • cooperates in
solving international problems and in promoting respect for human rights