Assignment Brief

BA (Hons) International Business & Finance Academic

Year 2017-18

Module Information:
Qualification: BA (Hons) International Business & Finance

Module Code & Title: BAIBF08001 Economic Environment for Business

Assignment Title: Individual Essay

Component Weighting: 30%

Date of Issue: 22 April 2018 Due date: 28 June 2018

To be filled by the student:

Student ID:

Tutor: Kanchana Gnanathilake

Date of Submission: 27/06/2018

*All work must be submitted on or before the due date. If an extension of time to submit work is required,
a Mitigating Circumstance Form must be submitted.

Has an extension been approved? Yes No

If yes, please provide the new submission date ….…/.…. /……., and affix appropriate evidence.

First Marker: Second Marker:

Agreed Mark: Refer: Yes / No

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General Guidelines

1. A Cover page or title page – You should always attach a title page to your assignment. Use
previous page as your cover sheet and be sure to fill the details correctly.
2. This entire brief should be attached in first before you start answering.
3. All the assignments should be prepared using word processing software.
4. All the assignments should print in A4 sized paper, and make sure to only use one side
printing.
5. Allow 1” margin on each side of the paper. But on the left side you will need to leave room
for binding.
6. Ensure that your assignment is stapled or secured together in a binder of some sort and
attach the Softcopy (CD) of your final document, system on last page.
7. The submission of your work assessment should be organized and clearly structured.

Word Processing Rules

1. Use a font type that will make easy for your examiner to read. The font size should be 12
point and should be in the style of Times New Roman.
2. Use 1.5-line word-processing. Left justify all paragraphs.
3. Ensure that all headings are consistent in terms of size and font style.
4. Use footer function on the word processor to insert Your Student ID, Name, Subject,
Module code, and Page Number on each page. This is useful if individual sheets become
detached for any reason.
5. Use word processing application spell check and grammar check function to help edit your
assignment.
6. Ensure that your printer’s output is of a good quality and that you have enough ink to print
your entire assignment.

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Important Points:
1. Check carefully the hand in date and the instructions given with the assignment. Late
submissions will not be accepted.
2. Ensure that you give yourself enough time to complete the assignment by the due date.
3. Don’t leave things such as printing to the last minute – excuses of this nature will not be
accepted for failure to hand in the work on time.
4. A printed version of the assignment needs to be submitted physically along with an
electronic version uploaded to the student learning management system on or before the
stated deadline.
5. You must take responsibility for managing your own time effectively.
6. If you are unable to hand in your assignment on time and have valid reasons such as illness,
you may apply (in writing) for an extension.
7. Non-submission of work without valid reasons will lead to an automatic REFERRAL. You
will then be asked to complete an alternative assignment.
8. Take great care that if you use other people’s work or ideas in your assignment, you
properly reference them, using the HARVARD referencing system, in you text and any
bibliography, otherwise you may be guilty of plagiarism.

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 Statement of Originality and Student Declaration

I hereby, declare that I know what plagiarism entails, namely to use another’s work and to present
it as my own without attributing the sources in the correct way. I further understand what it means
to copy another’s work.
1. I know that plagiarism is a punishable offence because it constitutes theft.
2. I understand the plagiarism and copying policy of the University of the West of Scotland.
3. I know what the consequences will be if I plagiaries or copy another’s work in any of the
assignments for this program.
4. I declare therefore that all work presented by me for every aspect of my program, will be
my own, and where I have made use of another’s work, I will attribute the source in the
correct way.
5. I acknowledge that the attachment of this document signed or not, constitutes my
agreement on it.
6. I understand that my assignment will not be considered as submitted if this document is not
attached to the attached.

Student’s Signature: …………………………… Date: ………………

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Table of Contents
Introduction ................................................................................................................................... 6
What is Globalization ................................................................................................................... 6
Impact of Globalization on Sri Lankan Economy ..................................................................... 7
Conclusion ................................................................................................................................... 10
References .................................................................................................................................... 11

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Introduction

The concept of globalization is vital for a country because it allows countries to benefit from
economic interaction and collaborate in handling economic, social, and political challenges in
today’s world. Different authors and institutions have defined globalization in different ways
because there is no one definition for globalization. In this report the author has compared the
institutional and general definitions separately. As per the next step, the author has explained
Arguments for and against the economy chosen. In the next section the author has described how
small country like Sri Lanka have been impacted in terms of economic, political and social
perspectives using costs and benefits for each perspective.

What is Globalization

Various authors and institutions have defined globalization in different ways such authors and
institutions like Hamilton & Webster, Ohiorhenuan, WTO, IMF, ILO, and WHO etc. According
to Hamilton & Webster, globalization refers to the social, economic, political, cultural and
technological which links in various countries.(Hamilton & Webster, 2015). In addition to that,
globalization defined as a process or set of processes which considered as a change of the spatial
organization of social relations and transaction. (David Held, 2018). Finally, according to IMF,
Globalization is the increasing interaction and connectivity of economics around the world by
exchanging goods, services, money, people and knowledge with each other.

(IMF, 2008)

As illustrated by the listed definitions from the above, that a large component of globalization is
economic and social liberalization.

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Impact of Globalization on Sri Lankan Economy

The integration of world economy is gathering momentum. With the liberalization of the economy
in 1977, Sri Lanka entered into the arena of globalization. (Sunday Times, 2001). From an
economics perspective, free trade capability can be viewed as a significant benefit of globalization.
Trade barriers in the past prevented countries from exporting domestic goods/services and
importing the ones not available locally. For example, Sri Lanka has benefited greatly by GSP plus
concession in order to develop is apparel industry which is the greatest source of foreign income
for the country.

(Shifani Reffai, 2015)

The flipside of it being, international pressures such as human rights related requirements, NGO
demands that is exerted on the government which may lead to negative political impact. Whilst
free trade helps countries to grow their GDP, reduce unemployment etc. it also impacts the
domestic infant industries which cannot compete both price and quality wise with more established
MNEs, which begs the question as to who really benefits from globalization; is it the
developed nations or developing countries such as Sri Lanka? Free trade has negative
consequences such as contraband, drugs etc. entering the local market.

But the biggest adverse impact of free trade is its impact on the trade deficit. Given that Sri Lanka
is a developing nation its import value is considerably more compared to the export revenue, which
in turn affects the balance of payments of the country. According to recent newspaper article, the
country is having a huge trade deficit which is a serious strain on the balance of payments. Given
that last year’s trade deficit was expected to be around US$ 9B, this year’s trade deficit is expected
to increase to about US$ 11B.

(Sanderatne, 2018)

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From an economics perspective, capital movement is yet another benefit of globalization,
especially for developing nations. Cash inflows, by way of foreign direct investments, loans, grants
etc. has enabled such countries to fund large public development projects, such as road
development, ports development etc. carried out in Sri Lanka with the funding of Chinese, IMF
loans and FDIs. For an example in 2009 Chinese funded worth of US$ 410 million for several
projects in Sri Lanka such as development of international airport at Mattala, highways new
constructions etc. (Ministry of foreign affairs , 2018)

The opponents may suggest that, this would make such countries financially more volatile due to
the build-up of foreign debt. For an example Sri Lanka has a major debt issue. After more than 10
years of taking out large amount of loans to build large scale infrastructure most of which has not
yet produced adequate returns, currently the country is struggling to make the payments. (wade
shepard, 2016) . The constant pressure in form of periodic loan financing needs which may
adversely impact inflation and interest rates. The ease of capital movement has also seen an
increase in financial crime such as money laundering and terrorism financing, which is downside
of globalization.

Globalization has contributed positively towards the development of the service sector of Sri
Lanka, especially tourism and BPO industries have seen significant growth by opening the Sri
Lankan shores to foreign entities and individuals. It not only has made way to foreign currency
inflows but has also created the opportunity for knowledge and skills sharing. Globalization has
also seeing significant movement of labor resources.

From a political perspective, drawing from the views of Hyper-globalists, global institutions and
organizations such as IMF, NGOs continues to influence the political decisions of countries. On a
positive note it compels governments to be more transparent in their policies and decision making
whilst ensuring proper governance and financial control. However, it also threatens the sovereignty
of the nation-state, in instances leading political instability. The present Sri Lankan regime is
scrutinized the united nations human rights commission with regard humanitarian irregularities,
which in turn has caused a rift among various internal political bodies.
(The sunday times, 2018)

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Global civil societies, a by-product of globalization, explains the divergence of activist groups that
exert considerable pressure the Tamil diasporas have caused political havoc by questioning certain
decision of the Sri Lankan government at the international circuit. (Samath, 2009). With reference
to the sceptics view of globalization, which currently is viewed as regionalization at best, one must
analyze the impact of over dependence on one region or country. The obvious benefits would in
turn expose the economy to uncertainties of immense impact, which was evident from the after
effects of the recent Brexit. The consequences of such over-attachment to given countries was a
discussion point during the previous regime, where the Sri Lankan government fostered a rather
unhealthy relationship which china and related entities, by isolating itself from the west whilst
exposing itself to corruption, trade irregularities etc.

(R Hariharan, 2015).

The ETCA between Sri Lanka and India is a classic example of a double-edged sword with both
economic and political implications, which one may say is an ultimate result of globalization.
Whilst it promotes free trade and knowledge sharing, it also has created great deal of insecurity
amongst Lankan employees due to potential jobs losses to Indian migrants. From social
perspective, the impact of globalization can be analyzed by deep diving in to the life style of
people, more importantly ascertaining the quality of life. Sri Lanka has access to better variety of
food and clothes has enhanced the life style, thereby uplifting the social status of individuals in
general.

(Siri Gamage, 2016).

The impact of globalization from a Social perspective can be further explored by addressing
education level of nation. Sri Lankan’s have now access to international universities via distance
and online learning programs at concessionary prices, which in turn allows students to get flavor
of foreign culture as well. Opportunities for Sri Lankan students are increasing where they can
access both national and international educational organizations through advanced technology.

(Wasala R, 2010).

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Conclusion

As per the conclusion, globalization concept can be determined as important to this world, as the
integration of the globe’s economics increasing into a single global market could create so many
benefits for every individual. However, there can be few disadvantages as well when looking into
both the sides. The debates related to globalization of Hyper-globalists, Sceptics and
transformationalists views are mentioned in detail. Finally, costs and benefits of economic, social
and political perspectives in Sri Lanka were discussed by giving real world examples.

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References

David Held, 2018. Stanford university press. [Online]

Available at: https://www.sup.org/books/title/?id=1565
[Accessed 15 june 2018].
Hamilton & Webster, 2015. Oxford university press. [Online]
Available at: https://global.oup.com/ushe/product/the-international-business-environment-
9780198704195?cc=lk&lang=en&
[Accessed may 2015].
IMF, 2008. Imf organization. [Online]
Available at: http://www.imf.org/external/np/pp/eng/2008/091208.pdf
[Accessed september 2008].
Ministry of foreign affairs , 2018. Ministry of foreign affairs. [Online]
Available at: http://www.mfa.gov.lk/
[Accessed June 2018].
R Hariharan, 2015. colombo Telegraph. [Online]
Available at: https://www.colombotelegraph.com/index.php/chinas-challenges-after-regime-
change-in-sri-lanka/
[Accessed 3 March 2015].
Samath, 2009. sunday times. [Online]
Available at: http://www.sundaytimes.lk/090705/News/sundaytimesnews_14.html
[Accessed september 2009].
Sanderatne, 2018. Times Onlne. [Online]
Available at: http://www.sundaytimes.lk/News
[Accessed 21 June 2018].
Shifani Reffai, 2015. Gsp plus coming. [Online]
[Accessed 2015].
Shifani Reffai, 2015. GSP plus coming. [Online]
Available at: http://www.dailynews.lk/?q=2015/10/19/local/gsp-plus-coming
[Accessed 19 october 2015].

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Siri Gamage, 2016. colombo telegraph. [Online]
Available at: https://www.colombotelegraph.com/index.php/globalisation-the-role-of-elites-
impact-on-social-structures/
[Accessed 09 September 2016].
Sunday Times, 2001. Business. [Online]
Available at: http://www.sundaytimes.lk/011216/bus4.html
[Accessed December 2001].
The sunday times, 2018. The sunday times. [Online]
Available at: http://www.sundaytimes.lk/120226/columns/Lasandak.html
[Accessed June 2018].
wade shepard, 2016. forbes. [Online]
Available at: https://www.forbes.com/sites/wadeshepard/2016/07/31/china-to-sri-lanka-we-
want-our-money-not-your-empty-airport/#56625e5a1beb
[Accessed 31 july 2016].
Wasala R, 2010. The island. [Online]
Available at: http://www.island.lk/index.php?page_cat=article-details&page=article-
details&code_title=5271
[Accessed 26 August 2010].

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