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Globalisation Basics

Globalisation- increasing links between countries & greater interdependance as result.

Interdependance- relationship 2+ countries- usually trade. Rely on each other- recourses/ services.

IT improvements- email, mobile, phone lines (SEA-ME-WE3/4) TNCs communicate easy/quick

Transport inprovements- more airports/trains/large ships- faster/ easier for people around world to talke face to face. Easier get supplies from around world or distrubute product all over world.

Call centers abroad- cheap labour, work around MEDC times, relaxed regulations- reduce running cost= bigger profit

Localised Industrialsed regeions- CASE STUDY Silverstone race circuit: 

many motorsport companies, renault formula 1 team close, surrounded by lots of airports so parts/ people can fly in, surrounded by main roads, improved tech.= communications with car improvements all over/ use internet to send info+data about car to people around world, lots of skilled workers.

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Advantages/ Disadvantages of TNC


adv - provide incentive to LEDC governments

disadv- workers recieve extemely low pay


adv-people may feel secure with job + regular income

disadv- poor working conditions, crowded, hot conditions+ work for many hours


adv- in MEDC'S laws and restrictions keep landscape clean

disadv- relaxed building laws can cause mass pollution eg smog in china

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TNC- company spread out over world. produce+sell products in more than 1 country

increase globalisation by linknig countries together through production/ sale in goods

offices + headquaters usually in rich MEDCs and factories in LEDCs


open in 1962, Sam Walton. 1st store Arkansas USA

Stores open across world (Mexico, Brazil, Canada and ASDA in UK). Sells variety of products (food, clothes, electronics etc). Biggest retailer in world- 8000+ stores/ 2 million+ employees.

Adv- 1. new stores create jobs. 2. Wal-Mart donated lots of money to improve healthcare, edication and environment in countries based in.

Disadv- 1. in USA factory workers $6 an hour- China >$1 an hour. 2.Suppliers have really long working hours. Bangladesh maximun 60 hr week but employees at Beximco that supply clothing claim to regularly work 80 hours a week.

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Change in Manufacturing Location- Indusrialisation

multpilier effect- if more people have jobs, more people spend andthe money can be reinvested in other companies

countries that relied on agriculture seen sudden growth in manufacturing industies- industrailisation called NICS (newly industrialied countries) eg india, china, brazil. TNCs inreased manufacturing in NICS- basing factories. 


1. cheap labour- some pay less than minimum wage (already lowers than richer countries) reduces manufacturing costs

2. working hour rules not strict- work longer

3. laxer heath/safetly regulations- often not enforced. less money spent on safety

4.prohibition of strikes- not allowed to protest against low pay. money not lost by work stopping

5. tax incentives/tax free zones- some NICS offer tax reduction/no tax to move manufacturing buisness to certain part of country- increases profits because less tax payed.

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Change in Manufacturing Location- De-indusrialisat

de-industrialisation- over long period of time parts of manufacturing buisnes decling resulting in fewer people emplyed= less production. 

In rich countires.

Reasons: factories move abroad to pay less

factories close down because cant compete with price of goods made abroad

manual wokers lose jobs but often increase in service industries like banking and insurance. pay higher wages than manufaturing jobs.

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20% world population

7% world merchandise

exports and imports + 70% GDP

in top 10 producers of oil

other countries benefit from lower prices

imports into EU- prices fallen

1/2 china's exports produced by foreign owned companies and many foreign investors

reduces income for jobs with unskilled labour (lose out if skill is similar to chineese exports)

other countries that ship similar goods miss out

increasive skill premium

export structure similar to higher income country

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In 30 years gone from mainly agriculture to 3rd largest economy. Loads of TNC's have factories there. Wor'd fastest growing economy. Assited areas/Enterprise zones set up for specific government help. (EZ normally smaller than AA)

Cheap labour-no single minimum wage eg in Shenzen its about £90 a month but in Beijing its £70. makes labour cheaper

Long working hours- chineese law- 40 hours week with 36 hours extra max. Not always enforced. Foxcon wokers done 80 hours overtime to maximise goods production

Laxer health and safetly regulations- laws slimilar to other countries but not heavily enforced. Over past decade hundreds factory workers treated for mercury poisoning despite laws on working with toxic materials.

Prohibition of strikes- they CAN strike but All-China Federation of Trade Unions (ACFTU) required bu law to get people back to work as quickly as possible so productivity is maximised. Illegal to join any other union other than ACFTU.

Tax incentives-free- Speical Economic zones. foreign buisness. no tax fist 2 years, next 3= 7.5% then 15% then on (half the 30% elsewhere) around $30 bil investment from tncs. Factories in shenzhen make for wal-mart. Advanced factories built fot tnc's to buy. 

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Global Energy Demands

increase in population- more electical goods (poorer countries more money to buy them). more goods= more energy demand. 

social impacts- 1.more power plants built. 2.people may have to move out of areas so plant can be built. 3.Radioactive waste from nuclear plant. if leaks cause death. if more are built- higher risk of leak. 4.creates jobs

economic- counties with lots of energy recourses become richer- countries with little have to buy from them

environmental- fossil fuels burnt=co2=global warming=rising sea levels-sever weather forcing species to move. releses NO and SO2= acid rai, wood for fuel= deforestation. coal minig= pollution and destroting habitats. Oil risks leaking when being transported

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Global Food Supply

range of foods shipped around the world, out of season foods available all year round= demand. increse in population= more food needed. countiries try to increase food production but not enough so need to import.

environmental- transporting- CO2 (increased links= transport) food miles (distance food is transported to supermarket). More food miles= more CO2. amount CO2 produced in growing+transporting called carbon footprint- nhigher cf= more CO2. Imported food high fm and cf. Marginal land used in LEDCS- not good for farming nutrients dry up. Soil thin and quickly eroded by farming degrading the environment. More food produced locally by energy intensive farming- pesticides, machinery, fertilisers used produce large quantities of food. Food miles are low but climate control, heating, lighting/electricity, making chemicals costs.

political- lots of water needed, countries with little rainfall need to irrigate from rivers and lakes. Hostilities between countries that use the sam resources increase as demand becomes higher

social- farmers switching from subsistence farming (family) to commerical. can make more money

economic- using chemicals (fertilisers) produces lots of food. Can be expensive. Farmers may need to borrow and get in debt. Producing food for export= farmer's steady income 

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Reducing Impacts of Globalisation

Enegy production needs to be sustainable (get what needed but not stop future getting what they want). Fossif fuel= not sustainable- reduce CO2/ global warming.

Wind- wind turns turbine, produce energy

Biomass- plant and animal waste burnt to produce energy

Solar- taken from sun (solar panels)

Hydroelectic- water trapped in dam + forced through tunnels. Water turns turbines= energy.


energy consumption increased 66% since 1990. Extra energy from turbines. Amount produced by wind inreased 16x since 1995. Spain ideal for wind farms- large, windy, barely habited areas. Built and wont annoy people. Ober 400 farms and 12000 turbines. 2008- 11.5% energy wind.

+tive- 2008- reduced CO2  emmisions by 20mil tonnes, saved €1.2bil gas/oil. Wind industry created 40 000 jobs.  

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energy consumption increased 66% since 1990. Extra energy from turbines.

Amount produced by wind inreased 16x since 1995. Spain ideal for wind farms- large, windy, barely habited areas. Built and wont annoy people.

Over 400 farms and 12000 turbines.

2008- 11.5% energy wind.

+tive: 2008- reduced CO2 emmisions by 20mil tonnes

saved €1.2bil gas/oil.

Wind industry created 40 000 jobs.  

-tive: conservationists say danger to migrating birds,

some think ugly- seen from miles away,

some think too noisy

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Reducing Impacts of Globalisation 2

Kyoto Protocol- agreement signed by most countries to cut CO2 emissions- each country has a target to reduce by.

Countires get Carbon Credits which they can sell to countries who arnt meeting their target- reward for low emissions.

Countiies can earn Carbon Credicts by helping poorer countries reduce emissions. 

Other international agreements help reduce pollution, Gothenburg Protocol- set targets to reduce acid rain and other pollution,

Recycling reduces waste- globalisation= access to cheap things so just throw away- landfill increased due to globalisation. Reduce impact on local scale by recucling.

Buying locally prodeced food= less fod miles, support local farmers and buisnesses. But can put people in poorer countries out of job. 

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