Globalisation, Development and Growth

Containerisation

System of freight sea shipping that has reduced transport costs across the globe.

Closed economy

An economic system that does not interact with foreign countries, restricting imports and exports.

De-globalisation

The process of reducing interdependence and integration between economies, often through policies that restrict trade and immigration.

Foreign Direct Investment

Investment made by a company or individual in one country in business interests in another country, typically through establishing business operations or acquiring assets.

Multinational Corporations

Enterprises that operate in several countries but with their headquarters in one country, typically specialising in importing and exporting.

Specialisation

When individuals, regions or countries concentrate on making one product to create a surplus to trade.

Trade liberalisation

Reductions in tariff and non-tariff import barriers between nations.

Intra-regional trade

Exchange pf virtually identical products between countries within the same region.

Trading bloc

Group of countries co-operating to liberalise trade.

Customs union

A group of countries that abolish tariffs and quotas to encourage free trade & adopt a common external tariff from non-member countries.

Globalisation

Process in which countries have become increasingly integrated and interdependent. Characterised by an increase in the volume of international trade, greater mobility of labour and captial, rise in power of MNCs and increasing communication technology.

Emerging markets

Term used to describe the financial markets of fast growing developing countries.

Comparative advantage

Refers to the relative cost advantage that one country or producer has over another.

Single market

Deep integration between nations involving free trade in goods and services and free movement of labour and capital.

Competitiveness

Sustained ability to sell goods and services profitably at competitive prices in a foreign country.

Dumping

When a producer exports at a price which is below the average costs of production - typically to clear excess inventory or eliminate competition.

World Trade Organisation/WTO

Polices free trade agreements and decides on trade disputes between countries.

Less Economically Developed Countries / LEDCs

Countries considered behind in terms of their economy, human capital, infrastructure and industrial base.

More Economically Developed Countries / MEDCs

Countries with a high degree of economic development, high average income per head, high standards of living, usually with service industries dominating manufacturing, and investment having taken place over many years in human capital and infrastructure.

HDI / Human Development Index

Measures life expectancy, birth and death rates, education, and quality of life. ) being the least developed and 1 being the most developed.

Barriers to Development

Lack of natural resources, poverty, gender inequality, infectious disease, high birth rate, relative location, foreign debt, political corruption and instability, lack of infrastructure, and dependency theory.

International Monetary Fund / IMF

An international organisation that acts as a lender of last resort, providing loans to troubled nations, and also works to promote trade through financial operations.

Currency manipulation

Government or central bank actions to influence the exchange rate, either directly by buying and selling currencies or indirectly through interest rates.

Devaluing currency

The central bank sells pounds and buys foreign currencies, increasing the supply of pounds on the foreign exchange market.

Expenditure-reducing policies

Measures that reduce AD to reduce spending on imports and hence recuse CA deficit