Globalization, Economy and Labor

Do Duc Hiep

Farukh Hasanov

Firuza Khusainova

Katherine Pineda

Moustapha Boulamine

Nafan Tarihoran

CONTENTS

1. Introduction to Globalization, Economics and Labor Globalization Economics Labor

2. Cases studies Colombia Indonesia Niger Tajikistan Vietnam

3. Experiences Comparison and Conclusions

Books and experts

Globalization

•Multidimensional phenomenon (Robinson, 2005).

• Intensification of the worldwide social relations (McGrew, 2008)

•Global economic integration (McGrew, 2008)

•Opening of local and nationalistic perspectives to a border outlook of an interconnected and interdependent world

•Free transfer of capital, goods, and services across national frontiers.

•May hurt smaller or fragile economies

The Characteristic of Globalization

International Trade

Direct foreign investments

Cross-border financial investment.

Thomas L. Friedman

Globalization…..

The core thesis of the book is that

globalization is not a trend or a fad. It is the international systems that replaced the Cold War system.

•It has its own rules, logic, pressures, and incentives that will, and do, affect everyone's country, and everyone's company, and everyone's community, either directly or indirectly.

Globalization This is Globalization 3.0.

In Globalization 1.0, which began around 1492, the world went from size large to size medium. In Globalization 2.0, the era that introduced us to multinational companies, it went from size medium to size small. And then around 2000 came Globalization 3.0, in which the world went from being small to tiny.

•There's a difference between being able to make long distance phone calls cheaper on the Internet and walking around India with a PDA where you can have all of Google in your pocket. It's a difference in degree that's so enormous it becomes a difference in kind.

Jodi Williams

What happens when you wire the world into networks and you blow away the walls,

It means that you and I can increasingly work on the world stage directly, unmediated by a state.

Jodi Williams

Jodi Williams won the Nobel Peace Prize (1997)

She was asked afterwards "how did you do it", and she had a very short answer: "Email"... She was what I call a "super-empowered good guy".

What globalization does by wiring the world into networks and blowing away the walls is that it super-empowers people, both for good and for ill.

Why Globalization ?

Competition Change Synergy

Kofi Annan ( UN)

• “The greatest challenge we face today is to ensure that globalization becomes a positive force for all the world's people, instead of leaving billions of them behind in squalor. Inclusive globalization must be built on the great enabling force of the market, but market forces alone will not achieve it. It requires a broader effort to

create a shared future, based upon our common humanity in all its diversity.”

1. Cases studies

Cases studies

COLOMBIA Capital: Bogotá Population: 48.32 million Area: 1,141,748 km2 GDP: $641.532 billion; Per capita: $13,458 INDONESIA Capital: Jakarta Population: 252,16 million Area: 1,904,569 km2 GDP: $867.468 billion; Per capita: $3,499 NIGER Capital: Niamey Population: 17,14 million Area: 1,267,000 km2 GDP: $6.022 billion; Per capita: $399 TAJIKISTAN Capital: Dushanbe Population: 8,21 million Area: 143,100 km2 GDP: $17,555 million; Per capita: $2,247 VIETNAM Capital: Hanoi Population: 92,47 million Area: 332,210 km2 GDP: $170.020 billion; Per capita: $1,895.576

Indonesia

Indonesia is the largest archipelago in the world, stretching 5.110 km along the equator from east to

west and 1.888 km from north to south.

It consists of five mayor islands (Java and Bali, Sumatra, Kalimantan, Sulawesi and Irian Jaya) and about 30 smaller groups, with more than 17,000

islands in total.

The chain of islands divides the Indian and Pacific Oceans and is enriched with natural resources and diverse

cultures, offering a vast range of economic activities. It has long been a popular tourist destination.

Indonesia… Economic globalization of trade sector.

•Competitive products in foreign trade markets: agricultural products, marine products, textiles, and minerals, etc.

•In the field of services: tourism.

Negative impacts of economic globalization of trade sector: Inflows of foreign trade caused national trade deficit

Rise of smuggling goods into Indonesia

Entry of tourists to Indonesia diluting the value of the noble nation.

Indonesia The globalization of economic production sector and labor

Positive impacts of economic globalization of the production sector are:

Foreign companies move operations to the country generating employment

Negative impacts of globalization: Companies in the country are more interested in partnering with

companies from outside. Damage to the environment and industrial waste pollution. Dependence of employment on operations of foreign companies in

the country

Colombia

Colombia

Economy and Globalization

•Historically Colombia is an agrarian economy and primary products producer. In the 19th century -> coffee, hides and gold.

• Colombia's market economy grew steadily in the latter part of the 20th century. In recent years growth has reached 6.9% in 2007, one of the highest rates of growth in Latin America

•According to International Monetary Fund, in 2012 Colombia's GDP the 28th in the world and third in South America.

• Colombia is rich in natural resources, and its main exports include mineral fuels, oils, distillation products, precious stones, forest and agricultural products.

• The financial sector has grown favorably due to good liquidity in the economy, the growth of credit and in general to the positive performance of the Colombian economy

Colombia Characteristics of globalization of economy in Colombia

Economy and Globalization

• Colombia was one of the 4 founding members of the Pacific Alliance

• Member of the United Nations, the Organization of American States, the Organization of Ibero-American States, the Union of South American Nations and the Andean Community of Nations.

• A wide range of cultural influences: Native American, Spanish and other European, African, American, Caribbean, and Middle Eastern influences are all present in Colombia's modern culture.

• Opening to financial markets and global capital flows and a dynamic exchange of goods and services have characterized the globalization of Colombian economy.

NIGER

Niger

• Balance of payments 1961 (year of the independence of Niger from France) and in 1981 trade balance was always negative.

• Imports of manufactured goods were significantly higher that exports in 1980.

• Structural adjustment programs (SAPs) -> privatization of several public enterprises.

• Closures has resulted the removal of thousands of jobs.

• Foreign Direct Investment (FDI): mining and petroleum sectors -> Creation of many jobs.

• A new development plan since 2011: invest US$12 billion in priority sectors with a view to attract FDI and create many new jobs.

• Border financial investment: member of the Economic and Monetary Union West Africa (UEMOA).

TAJIKISTAN

Tajikistan •Few products dominate total export revenue: <4% cotton, <5% aluminium and promising new exports are hydroelectric power. 4% of the world’s cost-effective potential.

•Tajikistan is strongly influenced by cycles of the world economy.

•Gross fixed investment accounted for 18% of 2010 GDP; about two thirds of it was public.

•Private investment expenditures undertaken in connection with emigration.

Tajikistan

•Formal credit markets remain very underdeveloped

•Allocation of credit to private businesses is correspondingly low, at 5 percent of GDP.

•Tajikistan is hydrocarbon-dependent business cycles in Russia.

•Tajikistan in the process of globalization: economic recovery over the last decade.

•Development of the country’s hydroelectric potential and input to industry are main economic priorities, but since they create few jobs, such capital-intensive activities must be balanced by labour-intensive ones.

Vietnam

Vietnam

Open its doors and start international integration since 1986 with the motto "diversity, multilateral foreign relations”

•170+ Diplomatic relations with over 170 countries around the world

•230+ Trade relations, exporting goods to over 230 markets countries and territories

•90+ Bilateral trade agreements

•60 agreements promotion and Protection of Investments

•54 agreements against double taxation and the Agreement on cultural cooperation bilaterally with other countries and international organizations health

•Multilateral cooperation and regional: Vietnam has a positive relationship with ADB, IMF, WB, ASEAN, AFTA, APEC, ASEM, WTO.

Economy: Success in liberalizing trade and opening markets 2001-2010

• Growth exports per 17.42% development Strategy 2001-2010 exports.

• By 2011, highest export turnover and lowest trade deficit in the past 5 years.

• Overseas markets increasingly open and diversified. Market Structure exports and imports has been a gradual shift towards reduced dependence on Asian markets

Vietnam

Labor: globalization has the effect to increased labor work to create jobs in the four areas: foreign investment, business production / processing exports, export of labor, and other areas.

• Nearly 2 million people directly, and millions of indirect jobs in year 2012, created from FDI sector.

• Vietnam currently has about 400,000 employees and professionals working in over 40 countries and territories with more than 30 industry groups ...

• In 2010, nearly 100,000 people went overseas for labor export.

Vietnam

Vietnam – India trade relations.

•1972: India and North Vietnam established official diplomatic relations and have since maintained friendly relations

•1992: India and Vietnam established extensive economic ties, including oil exploration, agriculture and manufacturing

•2000: the Indian Defense Minister called for a renewed political relationship with Vietnam, describing Vietnam as India's most trusted friend and ally.

•2012: Vietnam exported US$1.7 billion to India, an increase of 56.5% from 2011

•2014: Vietnamese Prime Minister pay an official visit to India.

Vietnam

Conclusions (1 off 2)

Challenges for improving economy dynamics, globalization and labor equities

•As the capability to exchange goods, services, people, data and communications capabilities are indicators of globalization of any country, regarding to communications capabilities, Many countries still have to improve.

Conclusions ( 2 off 2)

Negative impacts of globalization

• Interdependence of economic operations: An investment decision made in London can spell unemployment for thousands in Indonesia,

while a business decision taken in Tokyo can create thousands of new jobs for workers in India.

• Environmental, cultural and human rights negative impacts due to operations of international companies in exploitation of natural resources.

• Cheap manufactured goods can distress economy of other countries

Positive consequences of globalization: • Growth of creativity among economic actors, improvement of goods

quality due to international standards.

THANK YOU!