Globalisation leads to increased integration and interdependence between countries coming together in a global economy.
Eroding national boundaries, international developments, international organisations having and increasing impact on economic performance.
Trades in G + S US$8.5 trillion to US$16.0 trillion 1990-2002. Averaging 7% growth per year.
Financial flows reaching US$24.5 trillion in 2003. Deregulation of financial markets. Increased volatility and speculation.
Investment growth. FDI grew seven fold between 1990-2000. Fell to US$560 billion in 2003 due to economic slowdown. Reflecting interdependence between developing and developed.
TNC's doubled from 37,000 to 60,000. Expansion of other features extending beyond national boundaries.
Advocates - best opportunity for growth, specialisation, allocative efficiency, greater access to technology, labour and increased living standards.
Critics - Widening gap between rich and poor, distorts distribution of income and wealth, environmental costs, richer nations and NIC's are favoured, while developing and transition economies are neglected.
Increased trade flows with growth in trading blocs and agreements.
Increased specialisation and efficiency. Increase growth and GWP. Growth in global trade expected to remain over 7%.
FTA with China in July 2005 TFC industry. Lift tariffs, may cause structural unemployment, benefit specialist/brand name textile market
If trade growth in Africa, Asia and Latin America is lifted by 1%, it will lift 128 million out of poverty.
WTO Doha November 2001 - cut protection US$700 billion, raise GWP by US$2.8 trillion by 2015 - failed to meet January 1 2005 deadline. WTO Hong Kong November 2005.
Poorer nations' share of world trade has declined.
Financial and investment flows
Deregulation, improve access to overseas finance to fund domestic investment, negative effect on CAD, increased volatility and speculation
Increased FDI - six times greater than levels in 1980's, 77% of flows received by developed nations in 2002. Accelerates growth and...