Developments in the Global South:

Following World War II, the entire world was hit with a wave of economic globalization, mainly through the industrialization among the Global South

• Economic development and industrialization became a priority for developing nations

• It was a difficult task granted the class, ethnic, and religious divisions, and also a lack of sufficient leadership. The economy was also dominated by the capitalist bloc already focused on limiting the USSR during the Cold War

• Success stories:

  • The Asian Tigers of South Korea, Singapore, Hong Kong, and Taiwan were focused on an export-driven growth.

  • Deng’s China started edging the U.S. Economy after growing larger than Japan.

  • India opened its market up and had economic growth steel, chemical, automotive, and pharmaceutical industries

  • Oil countries created a monopoly on oil as they raised the price of the material in the 70s’.

• Failures:

  • In much of Africa, the Arab world, and parts of Asia, economic development was infrequent after independence.

    • Thus in the 21st, African countries encouraged economic growth through international investment and the expansion of its middle class.

• Differences can be accounted for geography, natural resources, colonial experiences, and the degree of political and social stability.

Re-globalization:

With modern development and industrial growth came a new network of global economic relationships:

• After WWI and the Depression wrecked the economy, international trade and investment declined as nations focused their money on rebuilding autonomy.

• What happened after WWII was a continuation of these earlier trends but in a more global sphere.

In what ways have global economic connections deepened during the past century? What have been the consequences of these deepening connections?

• Global economic connections have deepened in the areas of monetary policy.

  • After the US capitalists won WWII and tried to avoid the nationalist uprisings and economic contractions following WWI, they created a new set of institutions through the Bretton Woods system: the World Bank and International Monetary Fund (IMF),

  • World Bank

    • a major international lending agency that began to view the entire world as a single market (neoliberalism, essentially) that favored free trade— the reduction of tariffs, the free global movement of capital, a mobile and temporary workforce, the privatization of state-run enterprises, and tax and spending cuts

• These policies, facilitated by spending after WWII, skyrocketed the circulation of goods and capital, through world trade.

• Many developing countries were too reliant on exports, usually for raw materials and agricultural products.

• Money surged around the planet as investors and financiers spent trillions purchasing foreign currencies or stock with the intention to sell them quickly thereafter.

Transnational Corporations (TNCs):

• Global businesses that produce goods or deliver services simultaneously in many countries.

  • Companies like Toyota, Sony, and General Motors were of such size that they often trumped countries in assets and power.

Growth, Instability, and Inequality

Growth from a economic globalization:

• Economic globalization accompanied and helped generate the largest spurt of economic growth in history.

  • Facilitated population growth and life expectation, the output of the economy, and industrial output.

• Higher rate of literacy worldwide on a huge scale

The instability of the world economy:

• 1973 Oil Crisis resulted in economic stagnation in many industrialized nations and crises in developing nations, with huge profits for the oil-producing countries.

• The Latin America Debt Crisis of the 1980s came from an inability to pay debt and resulted in a major setback of econ. development

• The Asian Financial Crisis of 1997 resulted in the collapse of businesses, unemployment, and upheaval in Indonesia and Thailand.

• The Great Recession of 2007 came from the collapse of the US housing market (bubble) and created a huge contraction in the global economy,

  • This spread to Iceland, Sierra Leone, which “rippled” out to other nations, affecting European economic integration.

    • Worst economic crisis since the Great Depression.

Inequality:

• Globalization was unable to fix the problems of economic inequality, with great disparities between the rich and poor nations in income, resources, and opportunities. Oil-rich economies of the Middle East sold far more than the fruit-specialized countries in Central America, for example.

• Domestically, income inequality has increased within the US as its transnational corporations moved to companies with cheap labor.

  • Its steel industry was shrunk in size as many Americans moved towards high-tech industries.

• Mexico was also faced with inequality as its northern part grew more prosperous due to its ties with the US, as its south faced slower economic growth.

• China’s economic miracle created an inequality between its rural sector and its cities

Resistances to economic globalization:

How economic globalization was resisted:

• After the defeated of communism, economic disparity between the rich Global North and the developing Global South deepened and became a prominent issue.

  • The way the Global North organized its system of world trade and let political entities represent themselves in multinational economic organizations

    • 1970s: the Group of 77 (all developing countries) made an attempt to economically unite, but to little success.

    • Global South countries often spoke against the protectionist taxes on their exports imposed by the rich countries.

• World Trade Organization (WTO)

  • An international body of 149 nations negotiating the rules for trade and promoting free trade; they have often been the site of people protesting for the Anti-globalization movement.

• North American Free Trade Agreement (NAFTA)

  • a free trade agreement between the U.S., Mexico, and Canada in 1984

• Trans-Pacific Partnership

  • a free trade partnership between economies of the Pacific, most notably including Mexico, the U.S., and Japan.

The Anti-globalization movement:

• Comprised of diverse critics of globalization, hailing from poor and rich countries alike.

  • Believed that a free-market-driven corporate globalization…

    • lowered working standards (social)

    • caused ecological degradation (environmental)

    • endangered poor nations for economic extraction (economic)

    • enhanced global inequality in that it favors the rich countries and TNC’s (economic, social)

• Events:

  • 1999 Seattle WTO Protests: a huge gathering of protesters ultimately focused on issues including workers' rights, sustainable economies, and ecological and social issues. (if you wanted to summarize it briefly)

  • In 1994, Mexican peasants revolted against the government’s privatized reforms of communal land

    • Related to Mexico’s entry into NAFTA.

  • Late 1990s: South Indian protests against the opening of corporate Kentucky Fried Chicken restaurants and the American chemical giant Monsanto who grew genetically modified cotton.

    • Grassroots resistance to the spread of multinational and transnational practices in the agricultural and food sectors, showing a long cultural continuity of an Indian agrarianism

• Opposition to globalization also emerged from conservatives, particularly after the Great Recession.

  • Britain’s leave of the European Union in 2016 is an example of this.

    • The EU supported multilateralist alliances and neoliberalism through the creation of the WTO which supported free trade.

  • Donald Trump withdrew the United States from the Trans-Pacific Partnership and demanded to renegotiate NAFTA.

    • Both candidates in the 2016 election feared that international trade agreements would threaten American jobs.

  • In Turkey, Russia, China, and India, political leaders became more prideful in the purity of their nationality and culture.