What is globalization

• Globalization is a thinking. We can’t see it.

• It was started hundreds years ago but people didn’t
have that concept.
• Globalization refers to the free flow of economic
resources and factors of production across national
borders, creating an increasingly integrated world
economy.
• It gradually turning the world into a single and
integrated entity/a country with borders.
 Globalization’s features
Globalization

Economic
Cultural
Political

Division of Flow of
production commodities
process Local International
politics politics Flow of people

Flow of
Sell their
commodities National market commodities and
services around
Flow of capital World trade the world
World market
 Integration of Economies

• The increasing reliance of

economies on each other

 
• The opportunities to be able to
buy and sell in any country in
the world
• The opportunities for labour
and capital to locate anywhere
                                              in the world
• The growth of global markets in
                                                                           
                         finance
Stock Markets are now accessible
from anywhere in the world!
Copyright: edrod, stock.xchng
 Integration of Economies
• Made possible by:
– Technology
– Communication networks
– Internet access
– Growth of economic cooperation – trading blocs
(EU, NAFTA, etc.)
– Collapse of ‘communism’
– Movement to free trade
 How do multi-national companies speed up
the globalization

• The transnational companies opened

branches in other nations. They bring their
successful tactics in their native country to
their branches. If they fixed that country,
the company will grow larger.
 Corporate Expansion
• Multi-national
or trans-national
corporations (MNCs or
TNCs) – businesses
with
a headquarters
in one country but
with business
No matter where you go in the world, certain operations in a
businesses will always have a presence.
Copyright: mkeky, stock.xchng
number of others.
 Corporate Expansion
• Characteristics:
– Expanding revenue
– Lowering costs
– Sourcing raw materials

 
– Controlling key supplies
– Control of processing
– Global economies
of scale

Controlling supplies
      
may be one reason
for global expansion.
      
      
      
Copyright: rsvstks,
      
      
stock.xchng
      
      
      
      
      
      
      
      
 The result of globalization
It will lend us to a new era.
Simply speaking, every
country becomes getting
closer all together not only for
business and communication,
but also leads to one direction
merging( 合併 ) to a new
civilization of all human races
at the end. However, we have
to face to the coming conflicts
and difficulties.
In conclusion, under
globalization, rich companies
became rich, poor companies
became poor.
 The future of globalization

• As a matter of fact, notwithstanding being a

strategy of companies, globalization now becomes
a trend of modern commercial development.
• In the following decades, it is most likely that
globalization will carry on in a faster way with the
aid of various information technology.
• We hope the fruit of success brought by
globalization will be shared by all the people living
in the globe.
 Advantage
• Increased free trade between nations.
• Increased liquidity of capital allowing investors in
developed nations to invest in developing nations.
• Corporations have greater flexibility to operate
across borders.
• Global media ties the world together.
• Increased flow of communications allows vital
information to be shared between individuals and
corporations around the world .
 ……..Disadvantage of globalization
• Increase in the chances of civil war within
developing countries and open war between
developing countries as they vie for resources.
• Great competition for domestic companies in
developing countries.
• Investors have control on politics of country.
• Brain-drain
• Pollution
• Exploitation of natural resources
• Economic disruptions by other nations
 Impact of globalization on India
• Evaluation of L.P.G.
• Opportunities in BPO,KPO,IT etc. sector
• International expansion of Indian companies,
products
• Increase in the manufacturing and export
• It reduces the poverty from 40% to 25%.
• It increased the FDI.
• It increased the competition for domestic
companies.