Stage 4: Implementation
5 Discussion and conclusions
Globalisation is a short form for a cluster of interconnected phenomena and the term is used to describe, alternatively, a process, a policy, a predicament or the product of vast invisible global forces producing tremendous changes worldwide. The leading analyst on globalisation is Thomas Friedman, (see the World is Flat…)
Globalisation can be seen from two different perspectives – globalisation as interdependence of nations and globalisation as imperialism. For the Liberal School, globalisation is process of greater integration and interdependence of nations for mutual benefits and global development. Francis Fukuyama in his book titled “the End of History and the Last Man Standing” opines that globalisation represents the victory of political and economic liberalism that is evidenced in the triumph of the western ideas and values and the exhaustion of viable systemic alternatives to western liberalism. For the advocates of globalisation, nation states should open up their economies through deregulation and removal of all national barriers to international trade and investments in so as to enjoy fully the inter-dependency, mutual exchange of goods and services as well as development opportunities which globalisation offers. They further argue that “government has no business in business”, and therefore should not intervene in the economy, but play minimalist role.
On the other hand, Radical School of thought views globalisation as the universalisation of capitalism through international economic policies with the aim of deepening the incorporation and dependency of the peripheral states on the developed capitalist nations. “Globalisation has come with new alliances that are purely economic and ideological…the forces that control the globalisation process are capitalist with an agenda of promoting economic liberalisation and enthroning capitalism on the world stage as the global ideology” (Babawale, 2007). For the antagonist of globalisation, it is a well calculated strategy by the North
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to expand the operations of their Multinational Corporations for profit maximisation using the Information and Communication Technology (ICT). This however exploits and impoverishes more the already underdeveloped countries of the world. Based on this very fact, they regard globalisation as the highest stage of imperialism since it subjugates the Third World and appropriates its wealth to the West.
For the purpose of this course, the definition offered by the radical school appears to be more realistic and in tandem with the prevailing realities in the Third world. There is no doubt that globalisation offers some positive opportunities or gains to the entire world. For instance, it makes states of the world to be more interconnected and interdependent through trade and investments enhanced by improved Information and Communications Technology (ICT) like computers, mobile phones, internets and so on. In the words of Akinboye (2008), globalisation has brought a tremendous revolutionary transformation on our planet as a result of changes that have also taken place in ICT, all of which have cumulatively led to the villagisation of the globe. The interconnectivity emanating from globalisation is such that what affects one country can be seen and felt across the world, or can even affect or influence many other countries that are thousands of miles away. This is because the world has become a global village networked by ICT. Hence with just a click of buttons, you will know, see and even contribute to what is happening in any part of the world, even the most remote. The good thing about this global development is that there is now more global response to world issues or disasters such as Tsunami, climate change, terrorism etc.
However, whatever the gains of globalisation may be, its fallouts far outweigh its gains. It has integrated the world economies such that whatever affects one country particularly the big powers affect the entire world. In other words, it transfers the problem of one country to other countries that perhaps do not contribute to the problem. For instance, the Global Recession which lasted between 2007 and 2009 started in USA, but spread like wild-fire to other countries of the world including Nigeria.
Also, the effects of globalisation differ from one nation to another.
While the industrialised nations gain more, the underdeveloped nations gain less. Moreover, the underdeveloped nations are more adversely affected by globalisation than the developed nations. The reason being that unlike the latter, the former are characterised by weak social infrastructure, low export prices, unfavourable terms of trade, debt crisis, and lack of bargaining power in international relations.
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Khor (2000) laments that globalisation is very uneven process with unequal distribution benefits and losses. The uneven and unequal nature of the present globalisation process is manifested in the fast-growing gap between the world’s rich and poor people, and between developed and the developing countries, and in the large differences among nations in the distribution of gains and losses.
Therefore, the argument that the Third World states like Nigeria would reap bountifully from globalisation if they open up their economies is misleading. For example, over the last few years, it has been observed that the more Nigeria embraced globalisation through privatisation and deregulation, the more underdeveloped it has become. In fact, experiences have shown that un-checkmated globalisation is a double-edge sword. Even USA which champions globalisation around the world is aware of this simple fact. That is why the state (government) is still central to the US economy. The State still pays unemployment allowance to the unemployed Americans. Also, when the US was hit hard by the global economic meltdown in 2008, President Barak Obama came up with a government intervention policy known as “Bailout”
through which the government rolled out billion of dollars to bank-roll and save some of the troubled US companies such as the AIG, General Motors (GM), Citi-Bank etc, from bankruptcy and collapse, having been hugely affected by the global financial crisis. This is the same country that has been compelling the Third world governments not to intervene in their economies, but rather liberalise and allow the market forces to be the regulator.
SELF-ASSESSMENT EXERCISE
i. “Global capitalism has produced comparative price advantage for the West in the world trade.” Discuss.
ii. Has globalisation enhanced or undermined development in the Third world?
iii. Do you think Africa is ripe for non-government intervention in the economy?
4.0 CONCLUSION
The recent global financial crunch (2007/2008) has opened the eyes of many leaders of various countries to see the complex social and environmental consequences of unrestrained markets which globalisation advocates for. Global capitalism which is today in the guise of globalisation is founded on the foundation of exploitation of many by a privileged few, and that is partly responsible for the global inequalities and the resultant class struggle cum development crisis
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across the world. Therefore, it behooves the Third world nations to exercise some caution while dealing with globalisation otherwise they will be totally consumed by it. It is also worthy to note here that the Third world countries especially those in Africa are not yet ripe for full liberalisation and globalisation.
We therefore conclude that the reduction of state to a minimalist status as prescribed by globalisation will eventually lead to the crucifixion of the state. But economies in the Third world particularly those in Africa still require the full attention of the state or government to provide not only the enabling ecology for businesses to thrive, but also the ever-needed adequate regulations. Allowing the market forces to regulate African economies with their weak institutions will only result in further exploitation, hardship and underdevelopment.
5.0 SUMMARY
In this unit, we have been able to critically examine the phenomena of global capitalism and globalisation. We argued that global capitalism in all its various manifestations was designed from the outset to enrich the industrialised capitalist world at the expense of the Third world development. We further asserted that the forceful disarticulation, monetisation and the unjust incorporation and subjugation of the Third world economies into the world capitalist system in which they produce what they do not consume, and consume what they do not produce, has produced an unfair comparative price advantage for the western finished goods as over the primary products of the Third world. This has contributed to more development in the West, but has deepened underdevelopment in the Third world particularly Africa. Finally, it is advised that the governments of the Third world states to be very careful as they engage in the on-going globalisation process so as to mitigate its fallouts while maximising its gains.
6.0 TUTOR-MARKED ASSIGNMENT
“Globalisation has continued to have both positive and negative impacts in the Third World.” Discuss.
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7.0 REFERENCES/FURTHER READING
Akinboye, Solomon (2008). Globalisation and the Challenge for Nigeria’s Development in the 21st Century. Available on the internet at http://www.Akinboye Solomon and Globalisation.
Retrieved on August 16, 2012
Babawale, Tunde (2007). Nigeria in the Crises of Governance and Development: Retrospective, Prospective Analysis of Selected Issues and Events. The Political Economy of Development, Governance and Globalisation. Volume 1, 2 Lagos: Concept Publications.
Khor, Martin (2000). Globalisation and the South –Some Critical Issues.
Ibadan: Spectrum Books Limited.
WTO (2011). Trade Growth to Ease in 2011, But Despite 2010 Record Surge, Crisis Hangover Persists.
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