7.2. Global systems and global governence

As globalisation has increaed since WW2 a range of global systems have evolved to reflect the increased economic, political, social and environemtnal interdependence that has come to exist in the world. 

The key organisations are: 

• World Bank 
• IMF
• WTO
• IPCC

World Bank - 

Focus on countries in the developing world and since the 1990s have been focused on MDGs. 

• Too many western policies 
• Assumption that low income countries cannot modernise on their own
• Run and governed by a small number of Western nations
• Too much focus on GDP - not living standards. 

IMF - 

Main aim is to stablise international exchange rates and racilitate development. There are more than 180 member countries. 

• Lack of concern for democracy and human rights
• Advocates 'austerity programmes' 
• Slow to react
• Controlled by Western nations

WTO

Deals with the rules of trade between nations. It is a forum for governmetns to negoiate trade deals and settle trade disputes. 

• Mostly controlled by Western nations.
• Poorer nations arent represented enough

IPCC

Their purpose is to provide policty makers with an objective opnion on climate change, potential environmental impacts and possible response options. 

• Lack of specific advice
• Allegedley dilluted the impacts of climate change due to political pressure
• Errors in some reports

A cost saving strategy used by companies who arrange for goods and services to be produced by another company in a country where costs are usually lower. 

Positive points - 

• Provides jobs

Negative points - 

• Takes jobs away from some workers
• De-industrilisation for the home nation
• Strutural unemployment in the home nation. 

Positive - 

• Reduces unemployment
• Reduces geographical inequality for workers
• Addresses skill and labour shortages (E.g. lack of nursers in the UK)
• Some workers return to their home country with new skills 

Negatives - 

• Countries find it hard to retain their best and most talented
• Loss of skilled workers causes a training gap
• Outsourcing = unemployment 
• With greater movement of people there is an increased risk of disease pandemics 

Within many advanced countries inequality has worsend, for example, in Britian and Canada. 

In China and Sub-Saharan Africa inequality is reducing - the gap between the rich and poor is narrowing. 

The majority of people live in a country showing signs of an increasing poverty gap. The main exceptions are in Latin American countries such as Mexico. This gap can be measured by using the GINI coefficient. 

The richer in society can potentially cope better with the changes needed in skills and technology and therefore do not become disadvantaged in the job market. 

Countries are becomming more and more intergrated which is leading to the gap between developed and developing being closed. 

However, some very poor countries still lag begin, e.g. Burkina Faso. 

The fastest growing countries are in Asia. Sub-Saharan Africa has the economies that are growing at a faster rate than the most developed countries. 

One of the key arguments in favour of globalisation is that it will lead to greater political stability and economic intergration which will decrease the chances of armed conflict. 

Friedmann's 'Golden Arches' theory of conflict suggests that if a country had a McDonalds then they wouldn't go to war, in oter words, if all countries had the same global commodities then the chances of countries going to war is less likely. 

Trade can be used as a 'weapon', e.g. the US and EU sanctions on Russia over their actions on Ukraine. 

However, the growth in global communications can also spread conflict, for example, Donald Trump with Twitter.