Question

Globalization:

1. Is the process of intensifying the connections between national economies through international trade, foreign direct investments by multinational firms, and international financial investments.

2. Has been proven to worsen working conditions and increase poverty in poor countries.

3. Requires governments to weaken labor and environmental regulations in order to remain competitive.

4. Is coordinated by the International Labor Organization to ensure respect for the four core labor standards.

Please explain. Thank you!

Answer 1

Introduction:-

Since the early 1990's too much of the 2000's, most countries across the globe have seen a rapid increase in the level of global transactions owed by the fact that protectionism was causing a lot of problems including lack of competition & innovation among industries and the rising problem of reduced exports which led to currency issues.

As a result most giants such as India & China opened up their doors to foreign trade and increased their exposure to foreign markets. This resulted in higher paying jobs for both and the GDP's of most countries which implemented globalization has grown many folds.

Also, they have enabled themselves to be a part of the technological revolution and raise the overall standards of living for the people in the country.

Case Specifics:-

Is the process of intensifying the connections between national economies through international trade, foreign direct investments by multinational firms, and international financial investments?

Indeed, the success of most Multinational Firms can be contributed to the fact, that globalization has developed in the way that it has for all countries alike.

As a result companies have been able to freely invest in markets which previously were closed for investments by foreigners. Also, consumers today have larger choices than ever and can freely choose between domestic and international brands alike and can buy whichever suits their budget, taste and preferences and overall demand.

Take a simple example of Apple. The company has heavily invested in all major countries. It can procure its products from anywhere across the globe, design them in the United States, produce this in China and sell all over the globe.

This highlights how easy capital movement has become and how multinational firms have emerged due to the decreased government control on Trade & Commerce respectively.

Has been proven to worsen working conditions and increase poverty in poor countries.

Over the years in some poor countries where, globalization has just emerged such as Bangladesh, competitors have chosen to pay people even lesser to remain competitive in the industry.

Take the example of the clothing industry in Bangladesh which is the highest employer in the industry. People mostly today find it hard to work in the conditions offered and are underpaid to maintain low costs of the final product.

This is because competitive products are available in the market places and people prefer buying them because of cost and quality considerations.

Though, it is a proven fact that working conditions and poverty has increased in some poor countries because of globalization and often their own industries have suffered, however this is a matter of transition than a permanent occurring.

Once these firms tend to become developed they realize that mistreatment of employees will never help them.

Requires governments to weaken labor and environmental regulations in order to remain competitive.

To a certain extent this statement is true. In major countries across the globe, to meet with foreign standards countries have had to tweak their existent laws on labor and environment so that capital inflows from these companies is not impacted.

As a result of this occurrence, it is often blamed that multinational organizations tend to violate labor and environmental laws and their conduct at most times is not often ethical and in line with a countries ideologies.

However, Corporate Social Responsibility is a concept which believes that a company is also accountable to the society and is rapidly spreading and reversing this effect.

Is coordinated by the International Labor Organization to ensure respect for the four core labor standards.

The United Nations developed the International Labor Organization and all affiliated countries need to respect certain labor standards and are subject to checks and balances.

This ensures that the adverse effects of globalization can be checked and employee welfare is not hampered with respectively.

This is highlighted in the following four core labor standards which are as follows:-

• "Freedom of association and the effective recognition of the right of collective bargaining" (Convention 87 & 98)
• "The Elimination of discrimination ( Gender, Sexual Orientation etc.) in respect of employment" (Convention No. 100 & No. 111)
• "The Elimination of all forms of forced or compulsory labor" (Convention No. 29 & No. 105)
• "The Elimination of all forms of Child Labor" (Convention No. 138 & No. 182)

These laws act as pillars which help in participating nations to have minimum standards of employment thus ensuring that globalization does not encourage unfair labor violations respectively.

Please feel free to ask your doubts in the comments section.