UNIT 3: Economic and Environmental Impacts of Globalization

gr 10

Before we can understand contemporary economic globalization, we need to understand how economic globalization developed, or the foundation of economic globalization. The events that led to the development of economic globalization as we know it today:

4 pts

1- establishment of a new international monetary system

2- Creation of World Bank and the International Monetary Fund

3- Expansion of the free market economy into former soviet-bloc countries at the end of cold war.

4- Impact of new technologies on the movement of money around the world

1) A NEW INTERNATIONAL MONETARY SYSTEM

read if u wan

At the end of WWII, the democratic Allied countries (led by the U.S.) signed the Bretton Woods Agreement, establishing a new international monetary system – a global network of institutions to promote international trade and the regulation of currency among western countries. The 44 countries agreed to a common monetary system where each country would maintain a fixed exchange rate for its currency, meaning the value of a country’s currency is set by the govt, and they agreed the rate would be based on the gold standard, meaning all printed money would be convertible into gold and can be exchanged for gold. So any money printed must be backed by gold reserves. In times of crisis (famine, war, etc) A country must print more money/borrow money and would go into debt. When a country has too much debt, the value of the currency drops, resulting in inflation, where the country ends up with more currency but each unit of currency buys less. In 1971, the US dollar was no longer redeemable for gold by the US govt. By 1976, all the world’s major currencies also got floating exchange rates, meaning that the exchange rates of a country’s currency was no longer fixed by the govt, but find its own value on the foreign exchange market, or the value was determined by supply and demand (the number of people looking to buy and sell it in the foreign exchange market). The US dollar has been the world standard for all currencies since the end of the second world war and remains so today. It became the official reserve currency of the world in 1944 (decided at Bretton Woods).

international monetary system

—a global network of institutions to promote international trade and the regulation of currency (money) among Western countries.

Bretton Woods Agreement.

An agreement signed in 1944 by 44 countries to establish a new international monetary system, creating institutions like the IMF and World Bank to regulate currencies and promote international trade.

—————

This agreement established a system of rules, institutions, and procedures for the postwar global economy. effectively established a new international monetary system.

As the Second World War dragged on, the democratic Allied countries, led by the United States, became concerned about rebuilding the global economy after the war. In 1944, delegates from 44 Allied countries met in the United States at Bretton Woods, New Hampshire, to discuss the postwar economic order.

LED TO CREATION OF…

Bretton Woods Agreement.

fixed exchange rate.

-define

-wht did countries agree to at bretton woods

-the value of a country’s currency is set by the government.

-Each of the countries also agreed that the fixed exchange rate for its currency would be based on the gold standard.

gold standard.

This meant that all printed money, such as a paper dollar, would be convertible to gold and could be cashed in at any time for that gold. Thus, any money printed by the countries’ governments had to be backed by gold reserves.

inflation.

when a government has too much debt, the value of the country’s currency drops. The result is inflation—where the country ends up with more currency but each unit of currency buys less.

On August 15, 1971, President Richard Nixon “closed the gold window” by

“making the dollar inconvertible to gold directly, except on the open market” (the foreign exchange market). This meant that the US dollar was no longer redeemable for gold by the US government.

By 1976, all the world’s major currencies had floating exchange rates.

define floating exchange rates.

This means that the exchange rate of a country’s currency was no longer fixed by government, but found its own value on the foreign exchange market. In other words, a currency’s value was decided by supply and demand—the number of people looking to buy and sell it in the foreign exchange market.

The _____ dollar has been the world standard for all currencies since the end of the second world war and remains so today. It became the official reserve currency of the world in 1944 (decided at Bretton Woods).

u.s

2) THE WORLD BANK AND THE INTERNATIONAL MONETARY FUND

can read

The World Bank was created with the Bretton Woods agreement and is a UN agency but in practice is independent and controlled by its 189 members. Provides loans to less developed countries that are in financial difficulty. The countries are usually required to meet certain political or economic conditions like being more western (free market, democracy), in order to qualify for loans, that are long-term. The IMF also came from the Bretton Woods Agreement. Purpose was to work with WB to bring stability to international monetary affairs and expand world trade. It monitors exchange rates and only provides short term loans, and is also an agency of the UN. So, it lends money to countries in extreme short-term difficulty, and in return the country must adopt capitalist reforms. Funded mainly through quotas (proportional shares) member countries pay. A quota is based on the country’s relative size in the world economy.

what 2 un agencies came from bretton woods agreement?

biggest differnce between them?

The World Bank and The IMF

IMF It monitors exchange rates and only provides short term loans

WB Provides long-term loans to less developed countries that are in financial difficulty.

3) EXPANSION OF THE FREE MARKET ECONOMY (CAPITALISM):

read if ya want

The Cold War occurred after WWII, and was mostly an economic struggle between capitalist and communist countries. During it, communist countries under the leadership of the Soviet Union, operated under a centrally planned economic system, so the govt planners decided what goods to produce and how much. With the end of the Cold War, most soviet-bloc countries embraced the free market economy, and looked to the U.S. for leadership/financial investment. The free market economy expanded further when communist China opened its doors to Western businesses, joined WTO, binding it to int’l rules, growing international trade/investment, as it became a full partner of large economies and added over a billion people to worldwide markets. Meanwhile, India also entered the new global economy. It became a world leader in providing outsourcing services for Western countries’ companies. So, China became the leader of manufacturing goods, India offered cheap/efficient outsourcing through technology/computers.

cold war

-began after what

-what groups were fighting and each group led by whom

-what economic ideas divided the two groups/what was the fight all about

-The Cold War began in 1946, after the end of the Second World War.

- For over 40 years, the world was divided between the communist world, led by the Soviet Union, and the Western capitalist democracies, led by the United States.

-The Cold War was mostly an economic struggle between capitalist and communist countries.

end of cold war

-during it, what did comunist countries believe/what system. describe

-what heppend in the end. what side embraced what economy and looked to who for leadership for economics

-During the Cold War, communist countries—under the leadership of the Soviet Union—operated under a centrally planned economic system. This means that government planners decided what goods to produce, and how much.

-With the end of the Cold War, most Soviet-bloc countries such as Russia, Poland, and East Germany quickly embraced the free market economy and looked to the United States for leadership and financial investment.

free market economy.

system where prices and production are determined by supply and demand with minimal government interference, allowing buyers and sellers to make voluntary exchanges, fostering competition, and promoting private ownership

While ___ became the world’s foremost country in manufacturing goods for the Western world,_____ offered cheap and efficient outsourcing through the use of telephone and computer technology.

China

India

4) TECHNOLOGY AND COMMUNICATIONS:

read if ya want

Developments have transformed society, making the world seem smaller thus impacting the movement of money around the world. They decentralized international money markets (markets in which funds that are loaned for a short time to businesses or govts are bought and sold). So, instead of going through an investment dealer, people could use their computer to invest in companies or govts around the world. From small investors to mutual fund managers (which is a company that combines its clients money and invests it in a collection of bonds, stocks, other securities) billions ($) was being transferred by a click. Mutual fund managers have lots of money from investments, and invested the funds to where they hoped to make the most money/profit for their investors, creating a herd-like effect. Profitable investments attracted more money, while funds that lost money lost even more investors. This kind of international investment is known as the electronic herd: like a herd of cattle, these investors can be easily spooked by rumours that can cause a huge flow of money in and out of countries. The movement of this money can have a big impact on the currency and economy of a country, especially smaller ones.

international money markets.

(These are markets in which funds that are loaned for a short time to businesses or governments are bought and sold. Short-term bonds and certificates of deposit are examples of instruments traded in money markets.)

is a global marketplace for large-scale, short-term borrowing and lending of highly liquid currencies, facilitating international trade and finance by allowing central banks, large institutions, and corporations to exchange currencies and manage funds 24/7.

(A mutual fund is

a company that combines its clients’ money and invests it in a collection of stocks, bonds, and other securities.)

‘electronic herd’

-who

-what

-define

-Mutual fund managers in particular had huge pools of money available from investments by ordinary people.

-They invested these funds where they hoped to make the most profit for their investors and, of course, for their companies.

-This created a herd-like effect: profitable investments attracted more money, while funds that lost money lost even more investors.

This kind of international investment is known as the electronic herd: like a herd of cattle, these investors can be easily spooked by rumours that can cause a huge flow of money in and out of countries. The movement of this money can have a big impact on the currency and economy of a country, especially smaller ones.

JOHN MAYNARD KEYNES:

-in favour of how much govt involvemnt

-falling wages led to—-

-what is needed to increase spending and lift economy out of recession

-describe his 2 arguments: govts — and —- taxes when consumer spending is —- and threatens reccessions/inflation.

-whats stagflation?

British economist that was perceived as the most prominent in the 20th century.

—He was in favour of a large role for the government in the economy.

—Argued that falling wages resulted in decreased spending.

—Believed govt intervention was necessary to increase total spending and prevent/lift the economy out of recession

Was one of the main figures at the Bretton Woods Conference, argued for a system of fixed exchange rates. Between 1945 and 1980 his theories were applied by many govts.

- Today, his arguments form the basis for stabilizing the economy: Govts spend and decrease taxes when consumer spending is too low and threatens recession. Govts reduce spending and increase taxes when consumer spending is too great and inflation becomes a problem.

- Keynesian economics doesn’t always work, as stagflation is when there’s economic slowdown with high unemployment and high inflation that cannot be explained or solved by Keynesian economics.

recession

(a period of reduced economic activity lasting longer than two business quarters – six months).

FRIEDRICH HAYEK:
-believe that if this happens then this happens. why

-theories based on analysis of what

--in favour of how much govt involvemnt

-Believed that when govts try to plan/control society, those societies are doomed to failure. Argued human societies are too complicated to plan, and can never match the natural evolutionary wisdom that comes from a free society.

- His theories were based on his analysis of totalitarian regimes, like the Soviet Union and Nazi Germany, that had total control over every aspect of society. They claimed they were creating an ideal state for their people while stripping them of their basic human rights. So he promoted economic liberalism/freedom against socialism, govt intervention, and totalitarianism.

- less government involvement in the economy meant greater economic freedom and prosperity

In the early post-war period many western countries adopted ___ economics, and laid the foundations for a managed and welfare oriented form of capitalism, but by the 1960s inflation and weak productivity caused many economists to question govt _____ in the economy.

______influenced the British economic system under Margaret Thatcher, who openly supported his ideas. Also, U.S. president Ronald Reagan adopted_____ ideas. Both in the 1980s.                               

-Keynesian

-intervention

-Hayek

- Hayek’s

-DIFFERENCE bwteen FRIEDRICH HAYEK and JOHN MAYNARD KEYNES

Hayek argued that less government involvement in the economy meant greater economic freedom and prosperity, centre-right. Keynes believed that the govt should play a significant role in the management of the economy, centre-left.

End of WWII, 50 countries created ____ Looked for ways to encourage peace and help the global economy by opening up trade between countries.

U.N.

‘The decadent international

but individualistic capitalism

in the hands of which we found

ourselves after the [First World] War

is not a success.”

who said ts

—John Maynard Keynes,

‘The price system reflects demand

for goods by consumers and the supply

of these goods from producers. This

automatically steers resources to where

they are most needed without

the need for planners to discover,

understand, and correct

the imbalance.’

who said ts

friedrich hayekkk

GATT

-stands for

-purpose/aim

-(General Agreement on Tariffs and Trade): —Established in 1947 as an agency of the U.N.. The aim was to benefit the global economy by opening trade between countries.

4 principles of GATT (General Agreement on Tariffs and Trade)

-how to do trade

-treating goods from a member country like

-protect what

-requirement for applications; presnent what

• Conducting trade in a non-discriminatory manner. No member country could be given special trading advantages or deny equal treatment to another member.

• Treating imported goods from a member country in the same manner as similar domestic goods. For example, the imported goods could not be taxed at a higher rate.

• Protecting domestic industries (where this applied) through tariffs and not through measures such as import quotas or fees.

• Requiring any country that applied for membership to present a list of tariffs and other trade restrictions imposed on member countries. Once that country became a GATT member, it could only negotiate reductions to all trade restrictions.

tariff

(is a tax imposed on imports to increase their price and thus reduce competition with domestic products.)

Final round of GATT negotiations transformed GATT into the _____, on Jan 1, 1995. still follows the 4 principles, working to improve trade relations among countries, especially by removing tariffs and other barriers to trade. Accounts for 90% of international trade (at 1995, currently 98%). Total 166 members

WORLD TRADE ORGANIZATION:

FTA

-stands for

-what did it do

-intentions behind each country

-Free Trade Agreement

-1989. opened up trade between Canada and U.S. by removing most tariffs.

-Canada’s population, much less than the U.S., wanted to access large U.S. markets. The U.S wanted Canada’s natural resources and cultural industries. Canada kept the right to protect cultural industries, education, health care, etc. and some resources like water.

 (NAFTA)

-stands for

-formerly something, changed into this why

-North American Free Trade Agreement -1994, FTA extended to include Mexico. created the largest free trade in the world. In response to the treaty of Maastricht and the E.U. 

USMCA

-stands for

-replaced…

-what is it…. includes what……

-critised for….

-UNITED STATES-MEXICO-CANADA AGREEMENT :

replaced NAFTA in 2020.

-modernized version of NAFTA, including review every 6 yrs, and expires in 16 yrs unless extension is agreed to. New environmental regulations. Includes rules around digital trade.

-criticized for having more benefits for the U.S.

PERSPECTIVES ON FREER TRADE :

positive vs negative

5pts each, say atleast 3

think…..

impacts who? what does it affect or threaten? what does it encourage? who domiantes? what does it do? improves what? etc etc etc

POSITIVE

- provides great opportunities and benefits.

- improvement of trade

- freer trade/opening of world markets

- improvement of quality of life

-Encourages productivity

NEGATIVE

- results in negative impacts for countries and citizens

- environmental affects

- Loss of Sovereignty

Threatens small businesses (global competition)

- American control (economic imperialism)

the problem surrounding Canada–US trade has always been the huge difference in _____ size.

The United States has 10 times Canada’s _____ and is the world’s largest economy. Many American industries can easily swamp Canada’s smaller market with their products or services, forcing local industries to adapt and compete or face______.

On the other hand, smaller Canadian industries can adapt and grow by selling their goods or services in the huge US ____.

-population

-population

- closure

-market

GDP

-what it stands for

-define

Gross Domestic Product

is the total value of goods and

services produced in a country in a

calendar year.

EXAMPLES OF HOW ECONOMIC GLOBALIZATION HAS AFFECTED PEOPLE’S LIVES

• water: Today, the bottled water industry, which virtually did not exist 20 years ago, is worth US$100 billion a year. So who should have control over safe drinking water—the industry, or government?

• transnationals: The sales of large transnational corporations (TNCs) exceed the gross domestic product (GDP) of some countries. What does this say about the power of TNCs in the global economy?

• genetically modified food: The agribusiness industry is able to produce food with altered DNA codes. This means that produce such as tomatoes has a longer shelf life. But what are the implications of eating modified food products?

• technology: Advances in transportation technology allow people and goods to be quickly transported almost anywhere in the world. On the other hand, what does the resulting increased fuel consumption mean for the environment?

INTERNATIONAL AGREEMENTS AND ORGANIZATIONS: that contributed to the expansion of E.G.

- WORLD TRADE ORGANIZATION (WTO):

- GROUP OF 7 (G7):

-- LA FRANCOPHONIE:

- CANADIAN INTERNATIONAL DEVELOPMENT AGENCY (CIDA):

(WTO):

-stands for

-define/what does it do

-main purpose, how does it do this

-came from what

-WORLD TRADE ORGANIZATION

-works to improve trade relations among countries of the world, especially by removing tariffs and other barriers to trade. only int’l organization dealing with global rules of trade among countries.

-The main purpose is to settle trade disputes among governments and organize trade negotiations/meetings.Tribunals decide who’s wrong and who needs to meet WTO regulations. Countries that refuse to abide by rulings can face economic sanctions from other members or be expelled from WTO. 166 members.

-recall, came from GATT. 

EX of a trade dispute: Canada-US softwood lumber dispute. info -> pg. 230.

G7

-stands for

-made of who and what type of group

-what do they do.

-mention how they ‘play a vital role in global governence’

- GROUP OF 7

-informal group of the seven major industrial economies: Canada, U.S., U.K., Italy, France, Japan, Germany. (Russia was added in 1997, so it was G8, but in 2014 was suspended following the annexation of Crimea, where it reverted back to G7 2017 Russia announced permanent withdrawal).

-G7 leaders and reps from EU meet at annual summits to discuss economic and foreign policy.

-Not an institution, but plays a vital role in global governance bc it’s able to influence global institutions, like have 50% vote in WB and IMF, which impact policies of WTO.

reasons for disagreeing and agreeing with the g7

- Not everyone agrees with the G7, as it represents the interests of elite countries and doesn’t consider the needs of the rest of the world. Countries by growing pop and economies (China, India) aren’t included, nor are S.A., African, Asian countries. Annual summits lead to anti-globalization protests.

-On the other hand, G7 aids developing countries, campaigns combat disease, development programs, and debt relief plans.

LA FRANCOPHONIE:

-what does it protect/promote?

-what does it do/its goal

-whats canada’s role

-protects and promotes the culture of french speaking people.

-Also plays an important role in enhancing the economic development of countries with French-speaking citizens. goal is to accelerate the economic integration of the least developed Francophone countries into the int’l trading system. Also, strengthen the social and economic integration of Francophone youth by familiarizing them with new technology. 

-Canada is one of the original members and wealthiest, so it has a leadership role.

(CIDA)

-stands for

-responsible for what

-created to do what

-short term vs long term

-priorities is to promote..

-CANADIAN INTERNATIONAL DEVELOPMENT AGENCY

- govt agency responsible for administering foreign aid programs in less developed countries, short and long term.

-Created in 1968 to support sustainable development in developing countries in order to reduce poverty and contribute to a more secure, equitable, and prosperous world.

-Short term aid is for humanitarian crises like natural disasters and contributes money, supplies, human resources. Long term sustainable development CIDA sponsors medical personnel, farmers, teachers, technicians, and others to help people in less developed countries find lasting solutions to their problems.

One of _____ priorities is to promote human rights, democracy, and good governance in less developed countries.

CIDA, CANADIAN INTERNATIONAL DEVELOPMENT AGENCY

How Do Transnational Corporations Operate?

-how does one even become a tnc in the first place

-what big shift happens?

-grown rapidly since/during what event

-decision making

-Companies set up operations in foreign countries to expand their business, becoming a TNC. -

-Financial, production, and marketing decisions become base on a global rather than domestic concerns.

-Grown rapidly since 1950s, aided by peaceful times following WW2. More than 40 000 TNCs and more than 250 000 subsidiaries (companies controlled by the parent company).

-Decision making in TNCs are complicated. Financial decisions, research/product development occurs in head office, while marketing and distribution is left to individual subsidiaries.

subsidiaries

(companies controlled by the parent company)

The Impact of Transnationals on the Global Economy

describe the views of each opinion:

-that TNCs can help to reduce poverty in less developed countries by… (PROS)

-that TNCs can do harm in less developed countries by… (CONS)

PROS:

o bringing wealth into country through employment and investment. (The majority of international investment in less developed countries comes from TNCs and private sources.)

o passing on expertise and increasing human capital (knowledge, skills, talents workers have) (provide training and education for employees, creating a more highly skilled labour force. These skills, including management and entrepreneurial skills, may be transferred to other people and businesses in the country.)

o paying taxes to the host country’s government.

CONS:

o low paying jobs that are little to no skills/human capital. (employing managers from other countries but employing manual labour from local communities and paying them low wages. This does not lead to the transfer of management and entrepreneurial skills within the country.)

o capital-intensive production (most work done by machinery) instead of labour-intensive production. Developing countries have a high labour force and high unemployment, so this approach maintains poverty.

o uses influence over govt to gain subsidies and grants or exemptions from taxes/environmental laws.

o ignores human right issues. for example, by not allowing their workers to join trade unions or by buying materials from factories where child workers are exploited.

human capital

(knowledge, skills, talents workers have)

capital-intensive production vs labour-intensive production,

in which most work is done by machinery, (capital)

in which most work is done by hand.(labour)

Transnationals and More Developed Countries

-so like how has the expansion of tncs impacted developed countires

Expansion of TNCs have impacted developed countries: Job losses have occurred, entire industries have been moved offshore, and more developed countries have lost market share to less developed countries that can produce certain goods more cheaply.

EX: GM & GMC: largest automaker in Canada. Losing ground to foreign automakers, leading to massive job cuts in North America.

Telecommunications

like how does the advancement in telecommuications technologies around the world impact daily lives and business industry

just read if u want, sort of common sense

Advances allow people around the world to communicate instantly or witness the same event at the same time, by email, fax, text, phone call. Conflict/disaster can affect global economy (9/11 -> market decline) Revolutionized the business world: ATM + internet banking reduced costs for banking industry. Computers assist in info storing, stocks/bonds/securities traded globally 24/7. Internet, fax, phone, satellites allow ppl to communicate w/ customers/employees anywhere. Buy/shopping/advice call a foreign call centre.

TRANSPORTATION:

-how has evolutions in int’l transport systems, like what did these advances do

The growth of international trade and the globalization of production go hand in hand with improvements in international transportation systems. With these advances, more passengers and freight can be transported more quickly and efficiently. Today, trade can occur between parts of the world that previously had little or no access to international transportation systems.

• Evolutions/advances in international transportation systems. More ppl and cargo can be transported quickly and efficiently. Due to distances and geography, several types of transport used. (inter-modal transportation). Transport companies package cargo in large standardized containers that can be transferred directly to truck trailers or rail cars. Allows companies to set up production in any # of foreign factories.

90% of everything we consume came in____.

Nobody but the sender and recipient know what is in the ______. Only 2% is inspected. Not even crew or captain know.

___________ = flag that a ship flies that has the ability to vanish from the legal frame of its country of origin. 200 miles offshore, subject to laws of the flag they fly.

Around 20 men stay on a ship for 3 months. Seafaring is the___ most dangerous job after fishing. A ship lasts 25-30 yrs. India and Bangladesh are ship graveyards. 1 ship burns sulfur as 50 mil cars, creates green house emissions.

- ships

-containers

-Flag of convenience

- 2nd

intermodal transportation.

several types of transportation are often needed to move freight, especially when the starting point and destination are far apart.

INTERNATIONAL TRADING BLOCS:

-define

-why do south american countries join trading blocs

-A group of countries that agrees to reduce/eliminate trade barriers among the members. Offer countries growth along with challenges of change.

-many S.A. countries are economically unstable, as the wealthy have the majority of the wealth and the poor have little to nothing. Many SA countries hope that by joining SA trading blocs, they will be able to increase investment in their countries and improve economic stability.

MERCOSUR

-stands for

-describe it. some countries that r in it,

-main objective.

-what two things must members have/follow

-(common market of the South / mercado comun del Sur

-one of the major trade organizations in South America. Includes Argentina, Brazil, Paraguay, Uruguay, Bolivia (Venezuela was recently suspended for undemocratic practices and lack of human rights). Other S.A. countries are associated.

-Main objective is to improve member countries’ economies by opening markets, promoting economic development, and conserving the environment.

-Members must have democracy and follow human rights.

CAN

-stands forrrr

-what is it. whos in it

- (Andean Community of Nations / Comunidad Andina de Naciones):

-Trading bloc established in 1969. Consists of Bolivia, Colombia, Ecuador, and Peru.

CSN

-stands forrr

-what is it, between who. modeled after whattt

-why do countries join? what is a barrier

- (South American Community of Nations / Comunidad Sudamericana de Naciones)

- MERCOSUR and CAN negotiated a merger to create a S.A. free trade era, plans to eliminate all tariffs. Hopes to model after E.U.: share common currency, parliament, and passport.

-Many join hoping to increase investment in their economies. However, instability (within region and blocs) threaten these arrangements.

EU

-stands forrrr

-what is it

-share what

-EUROPEAN UNION

-A common market (free trade of goods, services, capital, and labor within the trading bloc). Trading partners outside the bloc are subject to a common set of trade restrictions. EU is largest and most powerful common market.

-Have a flag, anthem, founding date, and currency. Working to develop common foreign and security policies and to address other issues.

Includes 27 countries. Established in 1992 (Maastricht Treaty). So, its int’l organization that governs common economic, social, and security policy. No restriction of trade movement within EU.

Common market

an agreement between or among countries that includes the free trade of goods and services and the free movement of capital and labour within the trading bloc.

Trading partners outside the bloc are subject to a common set of trade restrictions.

THE ROLE OF THE WORLD BANK:

-what does it do, how does it do it, what is the help used for, has seperate what for what

WHAT IS IT?:

-agency of what, main goal

THE ROLE OF THE WORLD BANK: provides financial assistance to less developed countries to reduce poverty and improve living standards. Financial assistance could be interest free loans, low interest loans, or grants. Funds used for education, health system, or infrastructure. Has separate agencies for low-middle income and poor countries.

WHAT IS IT?: An agency of U.N. in practice is independent and controlled by 189 member countries, that provide financial assistance to less developed countries in difficulty.

WORLD BANK CRITISMS AND PROS
at least 2pts

WORLD BANK CRITISMS: Free market system cannot bring prosperity to all countries. Under the influence of developed countries that will use it for their purposes.

WORLD BANK PROS: fewer people living in poverty in less developed countries, increased life expectancy, reduced adult illiteracy, assists countries in debt.

WHAT IS THE INT’L MONETARY FUND?

-what is it? works with what to do what and what?

ROLE OF IMF:

-Responsible for what? monitors what and provides what?

WHAT IS THE INT’L MONETARY FUND? An int’l agency that works with the WB to bring stability to int’l monetary affairs and to help expand world trade.

ROLE OF IMF: responsible for regulating the economies of the world’s countries. Monitors exchange rates and provides short-term financial assistance.

austerity programs

-define

-who is known for making who follow these

-government policies to reduce budget deficits, typically through spending cuts, tax increases, or both, to control public debt and restore fiscal stability, often during economic crises. Proponents say it builds confidence with lenders, while critics argue it increases unemployment and worsens economic hardship by cutting public services and household income,

-IMF often advocates austerity programs for countries in financial trouble.

pros and cons of imf

at least 3 each

PROS: foster global monetary cooperation, secure financial stability, facilitate int’l trade, promote high employment, promote sustainable growth, reduce poverty.

CONS: deliberately support capitalist military, reduce gov’t debt by ↑ taxes and cutting social programs (Hayek economics), doesn’t actively support democracy, human or labor rights, dictatorships given loans to support their regime, controlled by U.S and developed countries.

IMPACTS OF ECONOMIC GLOBALIZATION IN CANADA:

4

TRADE LIBERALIZATION

Deregulation and Privatization:

Foreign Investment:

Outsourcing

TRADE LIBERALIZATION:

describes the process of reducing barriers to trade. This can include privatizing Crown corporations (government-owned companies), encouraging foreign investment, and outsourcing jobs.

Deregulation and Privatization:

relationship in regards to trade liberalization

an impact of trade liberalization has been the deregulation of crown corporations and privatization. Deregulation involves opening an industry to more competition by removing gov’t regulation. This can be done by privatization: the sale of gov’t owned industries and services to private businesses.

privatization:

the sale of gov’t owned industries (crown corporations) and services to private businesses.

Foreign Investment:
-canadian govt concern

-what is the view ‘today’

-gov’t has been concerned about the impact of foreign investment on the country’s economic independence and identity = this concern is economic nationalism. Public concern over American ownership in Canada economy led to foreign investment review agency, did little, closed by conservative gov’t.

-‘Today’ Canada seeks foreign investment by placing no restrictions on the repatriation of profit by foreign investors. This means that profits made in Canada can be freely taken out of the country by foreign investors.

economic nationalism.

the concern about the impact of foreign investment on the country’s economic independence and identity

Knowledge economy:

economic system where value is created from knowledge, information, and intellectual capital rather than physical resources

Outsourcing define

occurs when one company hires another company to fulfill certain tasks in production.

Outsourcing

-concern

-what do unions claim

-what do supporters of economic globalization claim

-One of the major concerns about trade liberalization—and economic globalization in general—is the issue of outsourcing and the impact it has on “our” jobs.

-Like unions in other more developed countries, unions in Canada claim that, because of economic globalization, outsourcing is resulting in significant job losses in our country. no job=low quality of life

-But supporters of economic globalization disagree. They argue that just as many jobs are created in Canada as a result oftrade liberalization as are lost to outsourcing. and that other countires have a higher comparative advantage: Ex: computer software field workers in India have skills and training like those in NA, but their wages are lower. So, many jobs are outsourced to India.

Outsourcing has become a controversial issue in Canada and other more developed countries.

Supporters of freer trade point out that every country has a_____ ______. This term refers to a country’s ability to produce a product or service with comparatively fewer resources than another country.

THE OIL INDUSTRY relating to global transport

-what is it and what does it do for transport

-describe the relationship betwen: E.G, international trade, and fossil fuels

-developed vs undeveloped countries

-explain demand supply relationship

- fossil fuels (oil, gas) provide energy, fueling the world’s transportation.

-Global transportation has increased because E.G made it easier to trade goods internationally. As globalization continues to expand trade, the transportation of goods will require more fossil fuels, or increased demand.

-Developed countries use fossil fuels to maintain the status quo of growing pop. Less developed countries increase fossil fuels to become more competitive in global markets.

-Although demand increases, supply is limited, and will eventually run out. However, the development of reserves could help increase the supply of oil and gas to meet the growing worldwide demand for the near future.

-Deforestation:

The destruction of forests by clearing or burning as a result of economic development or through changes in Earth’s vegetation due to global warming

-Urbanization:

conversion of rural land to city or urban space. The growth of towns and cities, as people migrate from rural areas in search of work and other opportunities.

Globalization has led to increased people living in cities now than ever before.

POLITICS OF RESOURCE DEVELOPMENT:

-big question ! read if ya wan

-Resource development in less developed countries:

- Effects of Global urbanization on the environment:

Should land be left in its natural state, or should it be cleared for development?

-A) Resource development in less developed countries: EX: deforestation in Borneo for economic growth. Trees absorb CO2 and release O2. Emissions of CO2 increase as consumption of fuel increases. If we continue to destroy forests and increase emissions, the atmosphere will be severely impacted = global warming. Developed countries already cleared their forests, making them wealthy (↑ development). Who’s responsible?

-B) Effects of Global urbanization on the environment: Majority of people live in urban areas than rural. Few natural resources are available in cities. Most natural resources consumed in urban regions are imported from the rural regions of less developed countries. Urban areas growing in less developed regions could harm the environment, as rural land is cleared for development, and developed countries may be harmed. Economy benefits.

RESOURCE DEVELOPMENT AGREEMENTS:

-between who

- many begin as negotiation between a corporation that wants to develop a resource and a gov’t that controls the land where the resource is found. However, more groups are included.

-MACKENZIE RIVER PIPELINE:

-what led to this/wht is it

-what happened/the investigation

-ending

-late 1970s, discovery of huge oil reserves in far North led to a proposal to build an oil pipeline along the Mackenzie River.

- Before it could be built, an investigation on the impact of the development on local people, and recommended a 10 yr freeze on the project to settle aboriginal land claims before construction began. It said Mackenzie Valley wasn’t only a construction site but home to people. Multiple views must be addressed before a fair agreement could be reached. Construction was postponed indefinitely.

-In 2002 a new proposal was introduced and in time many land claims were settled. Aboriginals were included in negotiations and were a part of the agreement. Project cancelled in 2018.

RESOURCE DEVELOPMENT ORGANIZATIONS: some resource development agreements are negotiated between gov’ts of many countries with common interests.

give an example

opec

OPEC

-stands for

-wht does it do/control

-(Organization of Petroleum Exporting Countries)

- formed in 1960 to regulate oil production and market. 12 member countries control much of the world’s oil. By agreeing about levels of oil production, OPEC controls the supply of world wide demand for oil. This often causes prices to increase, leading to higher revenues.

ENVIRONMENTAL LEGISLATION: global demand for resources is _____, and many less developed countries are trying to become more competitive in global markets → resource development may be ____. Local, national, and global legislations (environment) can help keep countries focused on ______ development, these laws can be controversial. They must be created to reflect a variety of perspectives, and the challenge of addressing all of them can create a ____ process.

-increasing

-rushed or unsafe

-sustainable

-lengthy

United Nations Convention on the Law of the Sea:

-what did it do

-gave all countries the right to fish on high seas, but coastal countries like Canada were given an exclusive economic zone (EEZ) of 200 miles (320 km) from their shores in which they alone can fish.

Canada and other coastal countries set fishing quotas to conserve fish stocks, but huge international fishing ships operated just beyond the 320 km line w/ no restriction on their catches. Tension escalated, leading to the situation worsening. So, in 1995 the UN agreement on Straddling and Highly Migratory Fish Stocks was created to manage fish stocks worldwide.

Convention on the International Trade in Endangered Species of Wild Flora and Fauna (CITES)
-what did it do

signed March 3rd, 1973. Have aimed to help draw attention to and discourage people from capturing endangered plants and animals for trading. Some argue it doesn’t help as local gov’ts can no longer regulate the ways in which endangered life is harvested.

---

Some agreements, such as the Convention on the

International Trade in Endangered Species of Wild Flora and Fauna

(CITES), have helped draw attention to and discourage people from

capturing endangered animals and plants for trading. Some would

argue, though, that the agreement has increased illegal poaching and

trading because local governments can no longer regulate the ways in

which endangered wildlife is harvested.

Kyoto Protocol:

-what is it

-what do critics say

-what is a point on the enforcement

-international agreement that aims to reduce emissions of greenhouse gases in order to curb effects of climate change.

-More than 190 countries signed it, but opposition remains. Some argue that reducing emissions won’t have a large impact, as the damage has already been done. Others object how developed countries to reduce the bulk of emissions and less developed aren’t required to.

-It’s a treaty (binding agreement), not a law. It’s voluntary and difficult to enforce / cannot be enforced.

SUSTAINABILITY:

(the ability to maintain or support a process over time) Avoidance of the depletion of natural resources in order to maintain an ecological balance.

SUSTAINABLE DEVELOPMENT:

development that meets the needs of the present without compromising the ability of future generations to meet their own needs.

SPIRITUALITY:

-define

-impacts

-based on

-affect what thats related to what

-consideration of matters beyond the purely material

-can have a profound impact on people’s values, morals, and way of life.

-Many experiences are based on life in nature.

- Spiritual values affect people’s perspectives on the environment and the role of prosperity in a globalizing world, which are reflected in reactions/perspectives on land/resource development.

STEWARDSHIP:

-define

-ppl who belive in this…

-obligation to maintain resources in a sustainable matter.

-People who believe in stewardship feel a responsibility to protect and tend the earth to keep it healthy for future generations.

the relationship between _________ and _______ often compels individuals and groups to protect the land. When some people believe in these and others do not, the difference can create ___.

-spirituality and

-stewardship

-conflict.

-CHALLENGES to sustainability:

-MAKING SUSTAINABILITY WORK: describe how cities try to combat the challenges

-↑ concentration of ppl = large garbage production, Air quality worsens due to pollution (smog).

-many cities encourage citizens to produce less waste, and use recycling programs. Also, encouraging sustainability through globalization by tying international trade agreements to environmental protection. (EX: by joining NAFTA, Mexico is obligated to bring its environmental protection standards in line w/ Canada and U.S. New regulations to improve air quality → developing public transport systems).

REGIONS OF CANADA:

-size, what biomes mainly composed of.

-issue of natural resources and enviornment—-explain! (stakes holders, FN, conservation plans, development, etc.)

-second largest country, but most of the land is covered in forests, tundra and ice. Consists of diverse populations and different landscapes.

- Though Canada’s natural resources are valuable in world markets, developing them may cause environmental damage. Since 1994, fed govt, FN groups, and non-FN stakeholders must work together to develop conservation plans for resources. (strategies to protect and preserve resources) ← decided after cod fishing stocks faced drastic reduction. So, natural resources are finite (limited), and if they are consumed faster than developed, they can become depleted, so this is why conservation plans for natural resources is vital.

Conservation plans

are strategies to protect and preserve resources.

REGIONAL DIFFERENCES:

-how is wealth distrbuted amoung provinces?

-where do ppl move/migration trends

-Wealth is not evenly spread throughout Canada’s regions and provinces.

-People tend to move where they think they might find work, so migration tends to occur from less developed provinces to more developed provinces.

For instance, Québec lost almost 300 000 people to other provinces over the last 20 years, while British Columbia and Alberta had an increase in population.

EQUALIZATION PAYMENTS:
-define

-amount depends on what

-why

- tax money from all provinces is collected by fed govt and dispersed via these payments in order to distribute wealth more equally through Canada.

-The amount of equalization payment that a province receives depends upon a formula that takes into account its financial wellbeing. Alberta hasn’t received payments since 1960s.

-The transfer of funds to less wealthy provinces is designed to ensure that Canadians have the same level of services like education and health.