SUPERPOWERS - Influence in the global economy

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  • Superpowers influence in the global economy
    • USA, EU and Japan (account for 60% of global GDP) are all capitalist economies. This means:
      • people own businesses and employ workers, and make profits.
      • are dominated by private enterprise rather than government-owned companies
      • Promote wealth creation and accumulation by companies and individuals.
    • After WW2,  Europe and the USA created a range of IGO's to promote capitalism.
      • WORLD BANK
        • money donated originates from developed capitalist countries trying to promote capitalism. (1944)
      • WTO (world trade organisation)
        • removed trade taxes and tariffs. removes barriers on international trade.     (1947)
      • WEF (World Economic Forum)
        • swiss non-profit organisation acting as a forum for discussion between businesses, politicians and IGO's. Pro free-trade, pro TNC's.   (1971)
      • IMF (International Monetary Fund)
        • helps economies opening up to world trade and investment. (1945)
    • TNC's - drivers of capitalist system and globalisation.
      • Public TNC's - owned by shareholders (APPLE, TESCO, SHELL, ZARA)
        • Walmart employs 2.3 million people worldwide.
      • State-led TNC's - owned by govt's (BANK OF CHINA, EDF, PETRONAS)
        • Found in countries who do not follow the capitalist model (Russia, China). Governments want all the profits. These TNC's are often in banking, gas and oil, vehicle manufacturing and factories.
        • 2, 3, and 4 top TNC's by revenue are state-owned, making US$329 (State Grid).
      • Economic power influences trade patterns and therefore FDI
        • TNC's can cause economic decline (detroit).
          • 90% of global patent royalties are paid to US, EU and Japan.
    • IGO's, Superpowers,and TNC's. (with capitalism)

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