Globalization is a recent approach from the 90’s. It’s a new economical way, where all the goods, firms and labors can move unfettered across the world, which has increased competition. Nowadays businesses are developing in a globalization way and it’s impossible to avoid this economical system.
The advantages of the globalization
- A worldwide market for the companies and for the customers:
o Globalization allows an opening on new markets. What pulls sustainability and the development of companies
o The quality of products and services is improved because of the increase of competition.
o It develops the business creation in the emerging countries. Globalization could also increase job opportunities
- The investment in foreign countries and particularly in developing countries. There are lots of options for investments for different companies.
- The spread of technical know-how and also economic or political knowledge from developed countries to developing but the reverse too.
- The exchange of “brains” permits an improvement of the techniques, quality and knowledge for the country.
- From a developing countries point of view, employment increased because of globalized businesses. Of the West side, this statement is more mixed.
- It also increases the employment and the wealth.
The disadvantages of globalization:
- Environmental degradation is one the most important negative effect of globalization (global warming problem)
- Hyperfinance: Nowadays, we live in a globalized and unregulated financial system that is fully emancipated from the underlying real economic system
- Because of competition and a gap between Western countries and developing countries, globalization has led to increase child work and slavery.
- Although globalization helped millions of people to escape from poverty, the gap between rich and poor is getting higher because of a lack of wealth distribution: Globalization made the rich richer and the poor poorer.
- Outsourcing problems: There is a pressure on the employed people of developed countries who are always under the threat of their jobs being outsourced
- Americanization of the culture: Globalization may lead to loss cultural identity
- Organized crime and terrorism are organizations that have greatly benefited from globalization, evidenced current events of the 21st century
Thus, globalization is still running and responding to issues more and more important and whose challenges, that is to say redistribution of wealth, protection of the environment or the well being of populations are priorities.