Globalisation

Case studies

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Coca-Cola

Background Information

  • sold in more than 200 countries + manufactured in 44 countries
  • HQ - Atlanta, Georgia, USA
  • 70% sales generated outside USA

Advantages

  • offers training + edu. to poor
  • runs community schemes in 10 LICs (e.g. Africa + Bangladesh)
  • invested $1.5 bil in Russian econ. (^ local infra. + constructing manufacturing plants)
  • bottling firms are local companies = profit stays in host country (very important to LICSs)

Disadvantages

 

  • conditions in bottling firms very harsh (no AC in tropical countries)
  • workers no benefits, health care out of little payment ($10 per day)
  • March 2004 LIC hosts faced depletion of local underground water table = chances of drought
  • pick up and move = 1000s left unemployed

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China

Background information

  • 30 years = China from agricultural to manufacturing (3rd largest in the world)
  • % of GDP came from agriculture fell from 30% to <15% between 1978-2004
  • no. products produced ^ rapidly ( 1978 - 4000 TVs, 2004 - 75 mil TVs)
  • manufactures large range of goods
  • TNC factories in China (Nike + Disney)

Reasons for growth

  • Cheap labour - no single minimum wage (e.g Shenzhen $180 p/m,Beijing $140 p/m,UK £990)
  • Working hrs -law states-max 40 hrs/w+36 hrs overtime/m, butnot enforced (NIKE 80 hrs over)
  • Laxer Health + Safety Regulations - not enforced ( last 10 yrs, mercury poisoning in facotry workers, despite law on working with Toxic material)
  • Prohibition of strikes - workers permitted to strike, but All-China Federation of Trade Unions requires all workers return to work asap
  • Tax Incentives - SEZ offer tax incen. TNCs pay 0 for 1st 2 yrs, 7.5% 3 yrs, 15% from then on (half of usual amount) = $30 bil investment from TNCs

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Wind Farms in Norway

Background information

  • currently, Norway home to 15 wind farms, electricity for 50 000 house holds

Advantages

  • wind conditions :) so very cost effective wind farms
  • nearly all materials are recyclable, and can farms can be removed without leaving signs
  • CO2 emissions fallen 13.3% since 1990s
  • Wind power industry created 20 000 jobs

Disadvantages

  • destory landscape
  • creates difficulties for tourism (linked to above)
  • wildlife destoryed (e.g. big blades dangerous to migrating birds)
  • Lifestyle distrupted due to noise = car travelling at 70 mph, each turbine

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