In today’s era, globalization is an essential element, and there is an expectation that it can improve people’s lives. Globalization has slightly different definitions in each field, but its essential definition is that it is the acceleration of the movement and exchange of goods, services, and cultural values around the world. According to the World Health Organization (WHO), globalization increases interconnectedness between people and countries. Globalization promotes the opening of international borders to an increasingly rapid flow of goods, services, and finance and transforms institutions at the international level. From an economic perspective, globalization means increasing the scale of trade and the rapid proliferation of technology, which means that the world economy is interdependent. Globalization started earlier than expected. At the beginning of human history, exchange and trade grew. However, the acceleration of globalization has advanced significantly before the technological development of transportation and communication. Especially, after the second half of the 20th century, global trade accelerated, and the term globalization began to be used in general (Youmatter, 2020).
Examples of multinationals and the global economy
Globalization has assisted the growth of various multinational corporations. This growth has tremendously impacted the global economy. Examples of multinationals are Apple, Amazon, and Walmart.
Among them, Apple exists as an American multinational technology company. This company designs and markets a wide range of technology products, including smartphones, computers, tablets, and online services. Apple’s most popular products are the iPhone and Mac, which are gaining popularity worldwide.
Amazon is also an American multinational technology company and the world’s largest online marketing company. In addition, this company is a great online retailer and ranks as one of the top five U.S. information technology companies. The company has been heavily influenced by globalization, as it deals with e-commerce, cloud computing, and artificial intelligence.
Finally, Walmart is an American multinational retailer and one of the world’s largest retailers. The company operates large markets, neighborhood markets, and online platforms to operate these types of markets as a chain. The company, which sells various products, has become a successful company through globalization.
The negative effects of globalization
While globalization has many advantages, it also clearly has disadvantages. The first drawback is the effect of the Russian invasion of Ukraine. The UN stated that this invasion could lead to a global food crisis. Secretary-General Antonio Guterres said war-induced inflation is increasing food insecurity in poor countries. These wars could wreak havoc on the global economy by reducing global supplies and raising prices for alternative goods, like fuel and food (Ukraine invasion could cause global food crisis, UN warns, 2022).
Another disadvantage is that growth in the community is not guaranteed due to internal investment. Often, the profits cycle back to the more economically developed countries (MEDCs) in which the transnational corporation (TNC) is based. Multinationals with a huge scale may drive out existing companies in the local market because the goods and services of a company operating in another country may be cheaper than a local company’s service. Globalization has these shortcomings, and governments must secure them (BBC, 2019).
The benefits people can have through globalization
Globalization is the most effective way to improve people’s quality of life. The first reason is that traveling the world or working in another country allows for cultural education and easy exchange of ideas and languages. Business travelers can connect between their company and the world through global networking. This makes it easier for them to accept and embrace other cultures.
Moreover, global companies can expand their presence by accessing new markets rather than staying in existing ones. Market diversification is the best opportunity to grow in today’s global age. The further a company’s image and market spread, they can make more profit and become successful.
Lastly, before globalization, people were only employed within countries, but with globalization, it is easy to hire and find talent from all over the world. So, various companies can bring in great employees, and boundaries and long distances are no obstacles in finding the right people for the job. These advantages make it easy for people to share culture and ideas, expand the market, and discover excellent talent (Globalization Partners, 2020).
Conclusion
Globalization has its downsides, but it does not change the fact that it can further improve people’s lives. Therefore, governments and multinationals must work together to further promote globalization and develop the world by finding solutions that can compensate for existing drawbacks and shortcomings.
References
MNC Definition with a List of Multinational Corporations – InDetail.(2020) [online] Available at: https://listbay.org/multinational-corporation/.
BBC (2019). Globalisation – Revision 5 – GCSE Geography – BBC Bitesize. [online] BBC Bitesize. Available at: https://www.bbc.co.uk/bitesize/guides/zxpn2p3/revision/5.
Globalization Partners. (2020). Top 5 Benefits of Globalization. [online] Available at: https://www.globalization-partners.com/blog/top-5-benefits-of-globalization/?utm_source=Adwords&utm_medium=cpc&utm_campaign=Search_ .
Murphy, M. (2022). Ukraine invasion could cause global food crisis, UN warns. BBC News. [online] 18 May. Available at: https://www.bbc.com/news/world-europe-61503049 [Accessed 8 Jun. 2022].
Youmatter (2020). Globalization: definition, benefits, effects, examples – What is globalization? [online] Youmatter. Available at: https://youmatter.world/en/definition/definitions-globalization-definition-benefits-effects-examples/.
