Geography- Globalisation

= the process of all the world's economies becoming integrated

it happens because of international trade, international investment and improvements in communications

countries have become interdependent as a result of globalisation- they rely on each other for resources and services

Improvements in ICT and transport have increased globalisation by increasing trade and investment

ICT:

• email, the internet, mobile phones and phone lines carry more information quicker and faster
• this has made it quicker and easier for businesses all over the world to communicate with each other e.g. a company can have its headquarters in one country and communicate with branches in other countries, no time is lost and its efficient

Transport

• more airports, high-speed trains and larger ships
• quicker and easier for people all over the world to communicate face to face
• made it easier for companies to get supplies from all over the world and distribute all over the world, don't have to be located near suppliers

• call centres are used by some companies to handle telephone enquires about their business
• improvements in ICT mean that its just as easy for people to phone a faraway country as it is to phone people in their own country
• a lot of call centres are now based abroad because the labour is cheaper, which reduces running costs
• example: In 2004 Aviva (insurance company) moved 950 call centre jobs from the UK to India and Sri Lanka as it costs less there (e.g. costs 40% less in India)

Improvements in ICT and transport have allowed some industries to develop around a specific region that is useful to them but still have global connections to get all the things that they need

• example: A lot of motorsport companies have offices in Oxfordshire and Northamptonshire, e.g. Renault Formula 1 team, they are close to Silverstone race circuit (can test the cars) and the area has lots of skilled workers
• people like drivers and engineers can easily fly into the area
• the manufacturers use the internet to easily send and receive information and data about their cars to people around the world

TNCs are companies that produce products, sell products or are located in more than one country- e.g. sony is a TNC as it manufactures electronic products in China and Japan

They increase globalisation by linking countries together through the production and sale of goods

TNC factories are usually located in poorer countries because labour is cheaper, which means they make more profit

TNC offices and headquarters are usually located in richer countries because there are more people with administrative skills (education is better)

Advantages:

• create jobs in the countries they are located in
• employees in poorer countries get more reliable income compared to farming
• TNCs spend money to improve the local infrastructure and roads
• new technology (e.g. computers) and skills are brought to poorer countries

Disadvantages:

• employees in poorer countries may be paid lower wages than employees in richer countries
• employees in poorer countries may have to work long hours in poor conditions
• Most TNCs come from richer countries so profits go back there and aren't reinvested in the poorer countries they operate in
• the jobs created in poorer countries aren't secure- the TNC could relocate the jobs to another country

Wal-mart began in 1962 when Sam Walton opened the first store in Arkansas USA

more stores opened across Arkansas, the across the USA and more recently across the world e.g. Mexico, Japan, Brazil, Canada, and the UK (called ASDA)

Wal-Mart sells a variety of products- food, clothing and electrical goods

Wal-Mart is the biggest retailer in the world- owns 8000 stores and employs over 2 million people

Advantages:

• Every new store that's built creates jobs e.g. a new store in Vineland (USA) opened in 2009, creating 700 jobs
• Wal-Mart donates hundreds of millions of dollars to improve healthcare, education and the environment in the companies it is based in

Disadvantages:

• Factory workers in the USA earn around $6 an hour but factory workers in china only earn $1 an hour
• Some companies that supply Wal-mart have long working hours e.g. Beximco in Bangladesh supplies clothing, Bangladesh has a maximum 60 hour working week but some people claim employees at Beximco regularly work 80 hours a week

many areas of production- internet, communication, wireless, bluetooth

products are sold worldwide

19 software countries e.g. Australia, Canada, Singapore, USA, South Korea, Italy, Russia, UK, Denmark

established 1998, first established in Krakow  in the new technology park

in 2004 made a profit of US$31.3 billion

Why Krakow?

• In a greenfield development- Krakow technology park= 122 hectares
• get special tax schemes and other benefits
  • companies with expenditure over 62 million per year are entitled to 0% income tax for the first 6 years and then a 50% reduction in tax after the 6 years
• close to many universities- Jagiellonian university- close ties, offers sponsorship for students, provides internships- cheap labour from high knowledge workforce
• get workers from many countries which accept lower wages like Poland
• can work 24 hours a day because use eastern European market- work around the clock

Advantages to Krakow:

• gives other companies an incentive to invest in the area
• more companies invest- more jobs and attracts more people= multiplier effect
• universities get jobs and internships providing funding and development of knowledge

Some countries that have traditionally relied on agriculture have seen a massive growth in their manufacturing industries recently- industrialisation

These countries= NICs (newly industrialised Countries), include places like China, Brazil and India

TNCs have increased manufacturing in NICs by basing factories there, reasons why:

Cheap labour

• The minimum wage is the lowest amount a company is allowed to pay someone, its set by governments
• some NICs don't have a minimum wage and the one that do its much lower than in richer countries e.g. the UK
• this reduces the cost of manufacturing goods because factory workers are paid less

Long working hours:

• the rules about working hours aren't as strict in NICs as in the EU
• means employees work longer hours so more product is made in a day

Prohibition of strikes

• some NICs don't allow strikes e.g. to protect against low pay, means money isn't lost when employees stop working

Tax incentives and tax free zones

• some NICs offer TNCs a tax reduction if they move their manufacturing to that country
• some NICs have tax free zones-TNCs don't have to pay if in certain area
• this increases the profits of the TNC because they pay lower taxes

Laxer health and safety regulations:

• there are fewer health and safety regulations in NICs and they are often not enforced
• lowers the cost of manufacture because less money is spent on increasing the safety of factories

Most rich countries have a history of manufacturing goods e.g. cars have been manufactured in the Uk for many years- recent years manufacturing in rich countries has decline- deindustrialisation

why?

• manufacturers move factories abroad because can produce goods cheaply
• manufacturers close down because they can't compete with the price of goods manufactured abroad

when deindustrialisation happens a lot of manual workers lose their jobs

as factories close some buildings become derelict

often an increase in service industries like banking and insurance, these pay people higher wages than manufacturing- deindustrialisation isn't all bad

In 30 years China has gone from being a mainly agricultural economy to a strong manufacturing economy. it is now the 3rd largest in the world after the US and Japan

the percentage of china's GDP (GDP=total value of goods and services a country produces a year) that came from agriculture fell between 1978 and 2004 from about 30% to less than 15%

at the same time the number of products manufactured in china has increased rapidly e.g. 4000 colour tvs were produced in China in 1978 compared to nearly 75 million in 2004

china manufactures lots of different products like clothes, computers and toys

lots of TNCs have factories in China e.g. Nike, Hewlett-Packard and Disney

Cheap labour:

• no single minimum wage, its different all over the country
• e.g. in Shenzhen its £90 per month and Beijing £70 a month
• labour in china is much cheaper e.g. in the UK £990 a month

Long working hours

• chinese law says that people are only allowed to work 40hours a week and a maximum of 36 hours overtime a month this isn't always enforced
• e.g. foxconn said that some of its chinese factory workers have done about 80hours of overtime per month to maximise production of goods

Laxer health and safety regulations

• they have them but they aren't enforced e.g. over the past decade hundreds of factory workers have been treated for mercury poisoning despite strict laws on working with toxic chemicals

Prohibition of strikes

• chinese workers can go on strike but the All-China Federation of trade uinions (ACFTU) is required by law to get people back to work as quickly as possible so productivity is maximised
• it is illegal for people to join any union other that the ACFTU

tax incentives and tax free zones

• has many special economic zones (SEZs) that offer tax incentives to foreign businesses
• foreign manufacturers usually pay no tax for the first 2 years in the zone, 7.5% for the next 3 years and then 15% from then on (half the amount of the rest of china)
• Shenzhen is one of the most successful SEZs- been around $30 billion of investment be TNCs
• Factories in Shenzhen make products for companies like Wal-mart, Dell and IBM

In 1979 began to allow investments from overseas

• chinese leaders accepted they were never going to modernise without new machines, modern technology, technical skills and efficient working practises that only overseas countries could provide

china remains a communist state- government controls banks, large heavy industries and public services

cheap labour supply- e.g. textile industry= labour intensive, asian workers are reliable and work hard for long hours

transport- access to main shipping lanes, use of containers has reduced the cost aswell as making it easier and more secure

government backing- governments in the region encouraged the import of overseas companies to establish factories and provide employment

markets- home markets expand as people get more money, asia is the most populous continent

Globalisation has increased the wealth of some poorer countries so people are buying more things and a lot of these require energy e.g. cars, fridges and television

other reasons why demand for energy is increasing:

• technological advances have created loads of new devices that all need energy e.g. computers, mobile phones and MP3 players- becoming more popular so more energy needed
• in 2000 the world population was just over 6 billion its projected to increase to just over 9 billion in 2050- more people means more energy is needed

producing more energy has lots of impacts because most comes from burning fossil fuels, increasing energy production has its impacts:

• more power plants will have to be built to increase energy production- power plants extremely large so people may have to move out of an area
• the waste from nuclear power plants is radioactive, if it leaks out from where it is stored it can cause death and illness and contaminate large areas of land,
• if more nuclear power plants are built to increase energy production there is a higher risk of radioactive waste leaking out
• increasing energy production will create jobs, people will be needed to build more power stations, run and maintain them

Economic:

• countries with lots of energy resources e.g. lots of coal, will become richer as energy demand increases- countries with few resources will need to buy energy from them

• Burning fossil fuels releases carbon dioxide, this adds to global warming, global warming will cause the sea level to rise and more severe weather and force species to move or make them become extinct
• burning fossil fuels releases other gases that dissolve in water in the atmosphere and cause acid rain which can kill animals and plants
• gathering wood for fuel can cause deforestation which destroys habitats for animals and plants
• mining for coal causes air and water pollution, it removes large areas of land which destroys habitats
• transporting oil is risky as oil pipes and tankers can leak, spilling oil which can kill birds and fish

• Before the 1960s people mainly ate a small range of seasonal food that had been grown in their own country or local area
• people now demand to have a range of foods all year round, regardless of growing seasons- this has led to the globalisation of the food industry- food is produced in foreign countries and imported
• the increase in the world's population also means more food is needed- demand has increased
• countries are trying to increase food production to meet this demand, but some can't produce enough to feed their population so food has to be imported too

• transporting food produces CO2-
• food miles= the distance food is transported to the market 
• the higher the food miles, the more CO2 produced
• carbon footprint= the amount of CO2 produce during growing and transporting, a larger carbon footprint means more CO2
• imported foods have to be transported a long way so have high food miles and a large carbon footprint.
• benefit of importing food means that a wide range of food is available all year round, also it helps meet the increasing demand
• more food could be produced locally by energy intensive farming- pesticides, fertilisers and machinery to produce large quantities of food, but although food miles are low, loads of energy is needed to make the chemicals and run the machinery- energy production creates lots of CO2
• to produce more food some farmers use marginal land (land that is not really suitable for farming e.g. steep hillsides and deserts) the soil in marginal land is thin and it's quickly eroded by farming, degrading the environment

• lots of water is needed to produce lots of food
• farmers in countries with low rainfall need to irrigate their land with water from rivers and lakes
• as demand for water increases there may be hostilities between countries that use the same water source for irrigation
• e.g. there is tension between Egypt, Sudan and Ethiopia because they all take water from the river Nile

• some farmers are switching from subsistence farming to commercial farming this is because they can make more money due to the high demand for food
• this reduces the amount of food produced for the local people so the have to import- which is more expensive
• if food prices go down, then farmers might not earn enough money to buy food for themselves

• using chemicals helps to produce lots of food but these chemicals can be very expensive- farmers may have to borrow money to buy the chemicals and this gets the farmer into debt
• farmers can generate a steady income by producing food for export to other countries

• energy production needs to be sustainable- it needs to allow people alive today to get what they need but without stopping people in the future getting what they need
• producing energy using fossil fuels is unsustainable
• fossil fuels are non-renewable so they will eventually run out and there won't be any for future generations
• using fossil fuels damages the environment- burning them produces CO2 which causes global warming
• energy produced from renewable sources is sustainable because it doesn't cause long term environmental damage and the resource won't run out
• producing energy from renewable sources contributes to sustainable development

wind wind turns blades on wind turbine to generate electrical energy

biomass biomass is material that comes from organisms that are alive or recently alive, it can be burnt to release energy it can also be processed into biofuels which are then burnt to release energy

solar power energy from the sun can be used to heat water, cook food and generate electrical energy

hydroelectric power- water is trapped behind a dam and forced through tunnels turning a turbine to generate electricity

• harnessed using a tall pylon fitted with blades to catch the wind
• the energy of the moving blade is turned into electricity in the nascelle
• the nascelle turns so the blade face into the wind
• usually built together in wind farms
• energy goes straight to electrical grid or directly to the user

need to be sited:

• strong and reliable- average wind speed no less than 5mper second
• away from obstructions which obstruct flow
• on flat ground- hilly terrain causes turbulence and reduces wind speed
• away from natural parks or areas of outstanding natural beauty

Spain's energy consumption has increased by 66% since 1990

some of the extra energy needed is being produced using wind turbines- has increased 16 times as much since 1995

Spain is ideal for wind farms because it has large, windy areas where not many people live- so won't disturb and annoy too many people

Spain has over 400 wind farms and a total of over 12,000 turbines

in 2008, 11.5% of Spain's energy was supplied by wind turbines

Positive

• in 2008 using wind energy reduced Spain's CO2 emissions by over 20 million tonnes
• in 2008, using wind energy saved Spain from importing about £2.1 billion of oil and gas
• Spain's wind industry has created about 40,000 jobs

negative:

• some conservationists say the wind farms are a danger to migrating birds
• some people think wind farms are ugly- they can be seen from miles away
• some people think they are too noisy

Globalisation has increased the demand for energy, more fossil fuels are being used to meet the demand producing loads of CO2 and adding to global warming

the international community is working together to reduce the amount of CO2 they produce because the problem of global warming is that is affects everyone

The Kyoto Protocol is an international agreement that has been signed by most countries to cut emissions of CO2 and other gases by 2012. each country is set an emissions target e.g. the Uk has agreed to reduce emissions by 12.5% by 2012

another part of the protocol is the carbon credits trading scheme:

• countries that come under their emissions get carbon credits which they sell to countries that aren't meeting their emissions target- reward for low emission
• countries can also earn carbon credits by helping poorer countries to reduce their emissions- means poorer countries will be able to reduce emissions quicker

• globalisation has increased the emission of gases that cause pollution like acid rain
• there are international agreements that help reduce pollution e.g. Gothenburg protocol
• The Gothenburg Protocol sets emissions targets for European countries and the US, it aims to cut harmful gas emissions by 2010 to reduce acid rain and other pollution

• globalisation means people have access to more products at low prices so people can afford to be more wasteful e.g. people throw away damaged clothes instead of repairing them
• things that are thrown away are taken to landfill sites and the amount of waste going into landfill has increased along with globalisation
• one way to reduce this impact is on a local scale is to recycle waste to make new products e.g. recycling old drinks cans to make new ones

• In recent years celebrity chefs, food writers and campaigners have encouraged people to eat more locally-produced food
• buying local food helps to reduce food miles because it hasn't had to be transported a long way and it also helps to support local farmers and businesses
• however if people only buy locally it can put people in poorer countries that export food out of a job