Globalisation in Asia

One reason for the acceleration of globalisation in recent decades has been changing government attitudes in regions outside Europe and North America.
Asia’s three most populated countries - China, India and Indonesia - have all embraced global markets as a means of meeting economic development goals.
In all three cases the establishment of special economic zones (SEZs), government subsidies and changing attitudes to free market globalisation have played important roles.

In the late 1960s, President Suharto turned his back on communism and opened up Indonesia’s markets.
American and European TNC’s met with Suharto’s advisors and collectively built an attractive new legal and economic framework for foreign investors.
Indonesia immediately became a popular offshoring location for TNCs.
World Bank lending funded the speed modernisation of its roads, power supplies and ports.
Human rights campaigners expressed concern that capital city Jakarta’s export zone had become a low tax haven for sweat shop manufacturing.

In 1991, sweeping financial reforms took place in India.
Since then Indian TNCs have grown in size and influence.
Until 2013, foreign retailers could only gain a presence on India’s own high streets by agreeing to form a partnership with local Indian businesses.
As a result McDonald’s restaurants in North India and East India are a joint venture between Vikram Bakshi and the McDonald’s corporation.
India’s high street rules have deterred many other foreign retailers such as IKEA.
90% of India’s shops are still family owned.

Before 1978, China was a poor and politically isolated country.
Under the communist leadership of Chairman Mao Zedong, millions died from famine. Most people lived in poverty in rural areas.
This changed in 1978 when Deng Xiaoping began to embrace globalisation with the radical ‘open door’ policy whilst the country remained under one-party authoritarian rule.
Strict rules on the number of children people could have were also introduced.
Over the next 30 years around 300 million left rural areas in search of a better life in the city.
Soon there will be 200 Chinese cities with more than 1 million inhabitants or more. Many are new, rapidly built instant cities.
Initially, urbanisation fuelled the growth of the low wage factories that gave China the nickname ‘workshop of the world’.
The worlds largest TNCs were quick to establish branch plants with Chinese owned factories in newly establishes SEZs.