8 Globalisation

‘Our world is becoming more

like one country every day.’

[8.1] Cycle rickshaws pass the McDonald’s restaurant in Delhi

Part 3  Global change

198 Geography for Global Citizens

In this chapter you will…

learn about: learn to:
✪ the globalisation process ✪ outline the process of globalisation
✪ changes in technology ✪ recognise the role of technology in the globalisation process
✪ the impacts of globalisation ✪ identify examples of economic and cultural factors that are
✪ changing global relationships between businesses, part of globalisation
nations and organisations. ✪ identify the impact of globalisation at an individual, local,
national and global scale
✪ describe the ways in which global relationships are
changing as a result of globalisation
✪ draw and interpret cartoons.

What is globalisation?
globalisation To help you understand the meaning of globalisation consider the following:
increase in international
communications and ✪ French champagne and French perfume are readily available at shops
trade and the breaking
down of national barriers everywhere in Australia.
✪ The world’s largest companies operate in many countries of the world.
✪ You can email a friend in the United States and receive an instant reply for
a very low cost.
✪ You can communicate with people around the world with your own
weblog or ‘blog’ on the Internet.
✪ More than 200 national football teams have entered for the FIFA World
Cup scheduled to take place in South Africa in 2010.
✪ The Australian television show Neighbours is
watched by more people in England than in
Australia.
✪ Australians can see movies made in Spain,
Italy, Japan and Thailand on SBS television.
✪ Mobile phones with Internet access are more
efficient in the Philippines than the normal
land-line telephone system.
✪ McDonald’s and Coca-Cola outlets are in
almost every country in the world, including
China and Russia.
✪ Satellite technology enables people to
communicate easily with each other in the
most remote locations.
✪ Air travel to the other side of the world now
takes less than twenty-four hours.

The writer Marshall McLuhan
coined the term the ‘global
village’ in the 1960s to describe
the effects of electronic
communication. In effect,
global communication ‘shrinks
the world’ by seeming to bring
distant things closer together.
global village
a concept suggesting
we are all members
of a world community,
regardless of our national
background and political
systems
See chapter 2 for a
discussion of the
Prime Meridian and the
International Date Line.
The Gregorian calendar is the
one we use today. Pope
Gregory XIII corrected the time
error in the calendar in use at
the time by omitting ten days
(5 to 14 October 1582).
Gradually, countries accepted
these changes, some taking
longer than others. For example,
Greece didn’t adopt the
Gregorian calendar until 1912,
and Turkey until 1927.
8 : Globalisation 199
✪ International tourism is a major growth industry.
✪ You can download music on the Internet from countries thousands of
kilometres away.
Globalisation affects a lot of different aspects of our lives. The great
expansion in communications technology has resulted in the reduction in
importance of national barriers (or country borders). Distance is less of a
problem because of the technology we now have. Goods and services can
be transported long distances and we can send messages long distances in a
fraction of the time and for a fraction of the cost compared with the past. All
of this in turn has affected the way we do things and even the way we think.
The globalisation process
Globalisation is not an entirely new process. The great colonial expansion
by European countries into the continents of Africa, North and South
America and Australia started several hundred years ago and brought
about significant change. Also, there was a big expansion in world trade in
the late nineteenth century. The establishment of the Prime Meridian and
International Date Line and world time zones together with the adoption of
the Gregorian calendar between 1875 and 1927 reflected an increase in the
adoption of international standards.
Globalisation today, however, has a much greater impact in our lives. It
involves constant cross-border social, cultural and technological change. You
only need to think of the increasing number of student exchange schemes
in operation throughout the world and you get an idea of the influence of
globalisation.
[8.2] The characteristics of globalisation
Trade Labour
Countries free to trade - Skilled labour more mobile.
more and enter into trade - Companies use cheap
agreements labour countries to reduce
costs.
Business Culture
Large companies - Lifestyle changes—in
wield more power food, fashion, music,
on the international
Globalisation
sport, religion and
stage language
- Spread of information
Technology Political influence
Advances in communications technology: Reduced power of nation-
- Internet links states and formation of
- mobile phones treaties and alliances
- media networks
200 Geography for Global Citizens

transnational Instantaneous communications allow knowledge and culture to be shared

corporations
large businesses with simultaneously around the world. In the process, country borders and
a home base in one geographical distance lose their importance as barriers to exchange.
country that also operate
partially or wholly in Globalisation has seen the freeing up of international trade and the
other countries
growth of ‘super companies’ where national borders are irrelevant. These
TNCs are discussed companies are known as transnational corporations or TNCs. Their power
more fully later in this
chapter. and influence in the world are enormous.

[8.3] MySpace is a social networking website that connects people around the world

Changes in technology
Changing technology is the main force behind globalisation. There have
been many significant inventions and developments in transport and
information
technology communications technology over the past twenty years—for example faster,
inventions and
developments that cheaper air travel; and larger, faster ships and aircraft. Most important in
facilitate the access terms of globalisation, however, have been the great advances in information
to and spread of
information technology, especially the development and use of the Internet. In the past,
people relied on ‘snail mail’, where letters could take days or weeks to travel
across the country or the world. Now, email and text messages are exchanged
The term ‘weblog’ was first
in minutes. You can also create your own website (or blog) using sites such as
coined by the American Jorn YouTube or MySpace [8.3].
Barger in 1997. It was later Technology gives power to people and allows them to do so many things.
shortened to ‘blog’.
Today we can truly say we live in ‘the information age’.

Information technology
information and Advances in information and communications technology (ICT) have been
communications
technology (ICT) rapid, especially in the last ten years. Technology is changing the way people
includes word processing, around the world live, the way they communicate, and the way they do
graphics, audio,
multimedia and other business. Some of the most significant technological developments have been:
computer applications,
and telecommunications ✪ the development and increasing use of computer networks and the
technology involving
communication by phone, Internet
video or satellite ✪ the development of fibre-optic cable that allows vast amounts of
information to be transmitted digitally along underground wires
✪ developments in telecommunications [8.4] with increased use of mobile
GPS phones, voice mail, pager systems and global positioning systems (GPS),
global positioning system,
which uses satellite which use satellite technology
technology to locate
your position ✪ the use of radio waves, including microwave technology
 8 : Globalisation 201

✪ the development of digital technology, especially for television

✪ the use of weather satellite imagery to track hurricanes or tropical
cyclones
global media ✪ the availability of news from countries around the world through global
networks
radio, television and media networks.
print media companies
with branches in many These new communications technologies have changed economic
countries competition and inspired ‘global conversation’, effectively shrinking space
and time.

[8.4] A telecommunications The Internet

tower
• It is a worldwide network of computers linked with one another by
global telecommunications.
• It allows millions of computers around the world to link and share
information and resources.
• It includes the World Wide Web (www), a system for displaying
information on the Internet.
• It includes email (or electronic mail), which allows individuals and
08007
groups to communicate with one another through their personal
computers.
• It came into existence in [8.5] Internet subscribers in Australia, 2004–2006
1969 as a system used
for United States defence 7000

purposes. 6000
5945
• There is no main
Number of subscribers (000)

5384
computer—in fact every 5000 4611
computer in the system has
4000
the same status.
• Growth in Internet use 3000
since the late 1990s has
2000
been spectacular.
• It has enormous potential 1000
as a tool for education,
but it sometimes has its 0
March quarter March quarter June quarter
limitations [8.6]. 04 05 06

[8.6] Using the Internet for research

202 Geography for Global Citizens

Mobile phones
• Early versions (analog) were large and limited in use.
• Second generation mobile phones used digital technology.
• SMS (Short Message Service) was developed. There are now over
five billion SMS messages sent every year worldwide.
• Third generation (3G) phones are now much smaller, much faster and
have many additional features that allow users to select their own ring
tones, take photos, listen to music, access their emails on the Internet,
pinpoint their position with GPS and organise their schedules.
[8.7] The BlackBerry®
Smartphone is a hand- • The growth in mobile phone use has been phenomenal throughout the
held device that acts world. Mobile phone adoption (the number of mobile phones per 100
as a mobile phone, people) is very high in Australia [8.8] and has exceeded 100 per cent
an email tool and a
in some countries.
personal organiser
08008
[8.8] Mobile phone users by age group, 2006

100
90
80
Number of users (000)

70
60
50
40
30
20
10
0
14–17 18–24 25–39 40–54 55+
Age group

Transport and communication technologies

Developments such as the steam engine and the industrial combustion
engine revolutionised transport just over a hundred years ago. In the last
thirty years, technological developments in road, rail, sea and air transport
have been enormous. Trade between countries has been increased by
container ships and ‘supertankers’ carrying oil and grain [8.9]. Huge,
containerised air cargo planes have also revolutionised air transport. The
aircraft and the ships being built now are larger and more sophisticated (with
satellite navigation systems) than anyone had ever dreamed possible. Bullet
trains and state-of-the-art motor vehicles are being developed and improved
at an incredible rate. Vehicles driven by solar power and electricity are being
 8 : Globalisation 203

developed and improved. Whereas once it would have taken a sea voyage of
six to eight weeks to travel to the other side of the world, it is now possible by
jet plane in under twenty-four hours. This has had the effect of ‘shrinking the
globe’, opening up all sorts of possibilities for trade and tourism.

[8.9] Supertankers have increased trade between countries [8.10] The arrival of the new Airbus A380 in Australia

Learning about …
1 Write one sentence in your own words to explain the concept of globalisation.
2 Read the list of examples of globalisation at the beginning of this chapter. What do they
all have in common? How are they all related to globalisation?
3 Explain how rapid technological change has been the driving force behind globalisation.
Give some examples.
4 What does ‘global village’ mean?
5 Explain the meaning of the following in your own words.
a Telecommunications
b Information technology
There is a skills section 6 When did the Internet come into existence? How important was this new development?
about using the Internet
in chapter 2 on page 48.
Explain why it is important to employ ethical behaviour when using email and the
Internet.
7 Explain the meaning of mobile phone adoption. How can some countries exceed
100 per cent?
8 What is a BlackBerry? How is it used? How does it demonstrate the force of
globalisation?

Learning to …
1 Look at the graph showing Internet use in Australia [8.5].
a Which three years are included in the graph?
b How many subscribers were there in the June quarter 2006?
c What does the graph show in relation to the growth of Internet use in Australia?
204 Geography for Global Citizens

2 Look at the graph showing mobile phone use by age [8.8].

a What does the graph tell you about mobile phone use and age?
b Which age group has the highest use?
c Suggest reasons for this.
3 As a class, construct a mind map that shows globalisation in simple terms, or construct a
mind map on the theme of technological change.
4 List some of the activities that you did yesterday (including the clothes you wore) and
explain the influence globalisation has on your everyday life.
5 Construct a timeline that shows some of the changes in technology that have led to
globalisation.
6 As a class, produce a list of approximately eight questions to ask people of an older
generation about their changing use of technology. Interview two or three older members
of your family or friends. Is there a technological gap between you and the people you
interviewed? Explain.
7 Working in groups, research one example of transport and communications technology
that has changed significantly over time. Prepare a report or presentation on your
research for the rest of the class.

The impacts of globalisation

Globalisation affects countries and people. Countries are now more
exposed to what is happening in other countries because of well-developed
communications systems. People too, are more exposed to the actions of other
people, in the way they think and act.
The impacts of globalisation can be conveniently categorised as:
cultural ✪ cultural impacts and the influence of global media networks
an expression of
attitudes, values, beliefs ✪ economic impacts, including the rise of TNCs and the increase in world trade
and a way of life of a
group of people ✪ political impacts and the changing global relationships among and between
countries and power groups.
[8.11] The Simpsons is an
example of ‘globalisation of
culture’ Cultural impacts
Cultural impacts include food, fashion, music, sport, religion and language.
Many people believe that globalisation is responsible for changing or
destroying traditional cultures—through the effects of the global media and
consumer marketing.
There is a general fear that globalisation is pushing so-called
‘Western ideas’ (from America and Europe) and influencing
the cultures of other countries [8.12]. The growth in global
communications has meant that dominant aspects of a culture
are becoming common. It is said that the American
entertainment industry (films and television) has led
to a type of ‘globalisation of culture’ because people
are influenced by them. How many American films
do you see in Australian cinemas and on television?

national identity
how a nation of people
see themselves and how
they are perceived by
others
A language dies somewhere in
the world every two weeks.
[8.12] Cultural impacts of globalisation
Music
Western popular and rock music
have spread into the developing
world. Music is also, more than
ever before, finding its way from
developing nations to developed
nations—for example from Latin
America, Africa and Asia.
Fashion
Paris, London, New York, Milan,
Hong Kong and Tokyo are
seen as centres of the global
fashion industry. Clothes for
the international market are
produced in large volumes by
highly organised factory systems
located in countries where
companies can take advantage of
low production costs.
Brand images
Brands such as American
Express, Levis, Nike and Sony
are recognised all over the
world. These brands have come
to symbolise desirable lifestyles.
8 : Globalisation 205
Global advertising campaigns are also effective in reaching large numbers of
people throughout the world. The increasing use of the Internet contributes to
this globalisation of culture.
There is a concern that national identity and traditional values of many
countries may be lost over time. Other people believe that globalisation helps
to keep cultures alive.
Globalisation has also had an effect on the languages spoken throughout the
world. Languages such as English, Spanish, Mandarin Chinese and Indonesian
have been displacing regional languages. English has tended to dominate as
the language of the global village through influences such as American films,
popular music and the Internet. As well, there are now more people who speak
English as their second language (even those with a smattering) than ever
before—some estimate the figure to be more than 1.5 billion people.
Traditional Chinese musicians at work—are they
under threat from American culture?
Food
Increasing interest in foods of
other countries result from travel
and migration. Eating habits have
changed worldwide.
Religion
Major religions such as Buddhism,
Christianity, Hinduism, Islam, Judaism
and Shinto have spread globally
through migration and colonisation.
Many religions have also been
adapted or changed and are
sometimes a cause of conflict.
Cultural Sport
impacts Colonialism and the movement
of people have resulted in local
sporting traditions spreading around
the world. Major ‘world cup’-style
events are a sign of global change.
206 Geography for Global Citizens

Global media networks

Advancements in technology have also led to the rise of global media
networks. Prior to the 1980s and 1990s, national media systems were
characterised by nationally owned radio and television. In the 1990s, global
media systems emerged. These global media systems developed due to a
combination of changing rules and regulations as well as economic and
technological change, such as cable and satellite technology. These changes
mean that individuals are now part of a global consumer market.

Among the largest global media networks are:

• Sony Corporation—involved in movies, music, games and electronic
products
• Time Warner—parent company of AOL (Internet service provider),
CNN (TV channel), Warner Brothers (movies) and Time/Life
magazines
News Corporation • Disney (based on early work of cartoonist Walt Disney)—involved
is a global business
organisation. Other in movies, TV, games, music and theme parks
global organisations are • News Corporation—films, TV, newspapers, books, magazines
described in detail in
chapter 10. (see snapshot below).

SNAPSHOT News Corporation

[8.13] Rupert Murdoch, CEO of News Corporation
News Corporation (or NewsCorp) had humble beginnings
in Australia as the Adelaide Advertiser, a newspaper
owned by Sir Keith Murdoch. His son Rupert Murdoch,
who succeeded him, is now the Chief Executive Officer
(CEO) of News Corporation. Murdoch has created a
global media empire based in the Asia–Pacific, North
America and Europe, using the very latest in computer,
cable and satellite technology. The major activities of this
global media enterprise include printing and publishing
newspapers, magazines and books, television broadcasting
and motion picture production and distribution. A
summary of these operations is contained in [8.14].
In summary, News Corporation has been a highly
successful transnational corporation. In June 2006, the
company’s total assets were US$56 billion, with a net profit
(after tax) of US$2.3 billion.
There are over 50 000 employees of News Corporation
spread around the world. News Corporation is a true
global media company, involved in the production of
films, television, newspapers, magazines and books. It
is still searching for new opportunities and using new
technologies.
 8 : Globalisation 207

[8.14] Structure of NewsCorp

Fox Studios in Sydney

Filmed entertainment Television
• World-famous motion picture and • Includes direct broadcast, cable and
television programming operation satellite television
• Includes 20th Century Fox, Fox • BskyB, Fox Television (in five continents),
Studios Australia, Searchlight Star, Fox Broadcasting, Fox Sports
Pictures, Fox Studios LA, Fox Australia, Foxtel, Fox Reality, National
Television Studios Geographic
• Major films include Star Wars, Titanic, • Star TV is a wholly owned subsidiary
X-Men: The Last Stand company of News Corporation. It is an
• Major TV shows include My Name Is Asian satellite service extending from
Earl, The Simpsons, American Idol Japan to the Middle East via South-East
Asia. Today it broadcasts over forty
services in seven languages and reaches
Newspapers over 300 million viewers in fifty-three
• The world’s leading publisher of countries across Asia. Star’s three major
English-language newspapers markets are India, China and Taiwan.
Courtesy of Fox Studios Australia Pty Limited,
• Publishes in the UK, US and Australia photo © Danial Nash While Star TV continues to grow, some
as well as Fiji and Papua New Guinea programs have only a limited audience.
Broadcasts of cricket are popular on the
• The company publishes more than Indian subcontinent but have no market
175 different newspapers in Japan
• Over 15 000 people worldwide
employed in printing more than
40 million papers a week
• Australian newspapers include the Books
Daily Telegraph, The Australian, Courier • HarperCollins Publishers, one of the largest
Mail and Herald Sun publishers in the world, with operations in
• Overseas newspapers include News of Australia, the UK, US and Canada
the World, The Sun, The Sunday Times, • Zondervan, an international Christian media
The Times (in the UK) and the New and publishing company
York Post (USA) News Corporation
The National Rugby League is 50 per cent
Magazines and inserts owned by News Limited
• Includes Big League, Inside Out (Australia),
Donna Hay (Australia), ALPHA, News American
Marketing (USA), Gemstar TV Guide (USA)

special made simple

Other assets
ISSUE 36
• News Digital Media (includes
DEC/JAN 2008
CARSguide.com.au, careerone.com.
au, NEWS.com)
eat, drink and be merry
DO-AHEAD CHR ISTM
AS • Fox Interactive, includes MySpace,
simple stress-free menus
ULTIMATE SEAFOOD
GUIDE AmericanIdol.com
all you need to know + more
FESTIVE TREATS
• National Rugby League
gifts to make and give
• In 2007, News Corporation
purchased the Dow Jones Company,
publishers of the Wall Street Journal
in the US

cranberry and pistachio

semifreddo puddings

, spice and everything nice

plus tempting sweets - sugar

subsidiary company
a branch of a major company
208 Geography for Global Citizens

The impact of television

Television in particular has had a large social impact around the world over
the last fifty years. There has been the development of cable and satellite
distribution, local channels and the move towards digital instead of analog
transmission. Over the past three decades, the number of television receivers
in use has grown enormously. Fashion and style in television programs
[8.15] Australian Idol is a popular
throughout the world is also apparent, often influenced by trends in the
reality television program
United States. For example, reality
television shows have become very
fashionable in many countries around the
world. Some of these shows choose exotic
locations such as tropical islands for their
filming. There are local variations but the
shows listed below are some examples:
✪  Big Brother
✪  Survivor
✪  Australia’s Next Top Model
✪  The Biggest Loser
✪  Popstars
✪  Temptation Island
✪ Australian Idol (Pop Idol, American Idol).

You may be able to think of others.

Australian Idol
• Original concept was Pop Idol, developed in Britain
• Now franchised in over twenty countries
• Winners usually receive lucrative recording contracts and become stars
in their own right
• Australian Idol went into its fifth series in 2007, with auditions held
throughout the country
• The Idol concept is a true example of globalisation at work

Learning about …
1 In your own words, define the term ‘culture’. What kinds of things are part of a culture?
2 What do you think is meant by the expression ‘the Americanisation of lifestyles’? Give
some examples from your own life.
3 What are global media networks? Give three examples.
4 Explain what is meant by a ‘cultural factor’ shaping the world today as part of
globalisation.
5 Some people argue that globalisation leads to an increasingly Western-dominated
international culture. What does this mean? Give some examples.
 8 : Globalisation 209

6 Explain how the following cultural factors shape the world today—use one to two
sentences for each.
a Fashion c Sport e The English language
b Food d Music f Religion
7 Explain what the global commercial media market is.
8 List the four TNCs that dominate the global media market.
9 Refer to the snapshot of News Corporation.
a What is News Corporation and where did it start?
b What are the major activities carried out by News Corporation?
c What evidence is there of the size and the success of News Corporation? Are size
and success necessarily the same thing? Explain.
d How has News Corporation entered the Asian market? Has it been successful?
How can you tell?
10 Read the information about Australian Idol.
a Explain how the show is an example of globalisation at work.
b Why do you think shows like this are so popular?

Learning to …
1 Visit the News Corporation website at <www.newscorp.com> to find out more about
News Corporation. Make a list of important facts about the company based on your
research.
2 Visit the ABC website at <www.abc.net.au>. What do you notice about the variety of
services and information available on this site? Why is it so detailed?
3 As a class, discuss the effects that the mass media has on people’s lives and the way
people think.
4 Individually, or in groups, search the Internet for the latest information about Australian Idol
and similar shows in other countries. Write a brief report about the latest global shows.
5 Working in groups, design your own reality television show. Use a ‘global approach’ so that
a number of countries are involved. Explain your show to other groups. You may wish to
role-play an episode of the show.
6 As a class, hold a debate on the topic: ‘Reality television shows are destroying local culture’.
7 Conduct a survey to analyse the influence of American culture in the Australian
entertainment industry. Count the number of American films currently in cinemas,
advertised in newspapers and/or the number of American television shows each week.
What conclusions can you draw from this survey?

Economic impacts
The economic impacts of globalisation are varied and complex, but certain
trends can be identified:
✪ the rise and increasing influence of TNCs
✪ the growth and the freeing up of international trade
✪ an increase in the volume of financial transactions among countries,
among businesses and among individual people
✪ changing patterns in labour markets as jobs move to where labour is cheap.
210 Geography for Global Citizens

The rise of the TNCs

‘… Globalisation is what happens when you lose your job in Brunswick, Bankstown or Elizabeth
because the company for which you work has been bought out by the Australian subsidiary of a
Dallas-based transnational company that has decided to relocate its production of T-shirts to Mexico
because of cheaper wage costs and lower health and safety standards. It is what happens when
you finally get a job in Brisbane under a new employment contract that lowers your wages and
conditions and your boss explains that this is essential to compete with the Mexican, or Indonesian
or Chinese workers. It is what happens when your sister is sacked from her hospital job because of
budget cuts by a state government that defends its actions by saying it must meet the demands of
international credit-rating agencies for balanced budgets and lower taxes …’

John Wiseman (1998) in Global Nation? Australia and the politics of globalisation, Cambridge University Press

[8.16] An example of a TNC everyone is familiar with— Transnational corporations are large businesses
McDonald’s with a home-base in one country but operate
partially or wholly in other countries. TNCs
are increasingly working on an international
scale. The main aim of large corporations is to
globalise their operations and make a profit. The
top twelve TNCs in the world and their home
country, each company ranked by foreign assets,
are shown in table [8.17]. If TNCs were ranked by
revenue rather than foreign assets, the top three
corporations would be Wal-Mart (US), BP (UK)
and Exxon Mobil (US). The table below does not
include financial TNCs (banks and so on). They
are listed on page 212 [8.21].

[8.17] The world’s top twelve TNCs, ranked by foreign assets, 2005
Ranking Corporation Home Industry Foreign assets
economy (US$ million)
1 General Electric US Electrical and electronic equipment 448 901
2 Vodafone Group UK Telecommunications 247 850
3 Ford Motor US Motor vehicles 179 856
4 General Motors US Motor vehicles 173 690
5 British Petroleum (BP) UK Petroleum exploration/refining/distribution 154 513
6 Exxon Mobil Corporation US Petroleum exploration/refining/distribution 134 923
7 Royal Dutch/Shell Group UK/Netherlands Petroleum exploration/refining/distribution 129 939
8 Toyota Motor Corporation Japan Motor vehicles 122 967
9 Total France Petroleum exploration/refining/distribution 98 719
10 France Telecom France Telecommunications 85 669
11 Volkswagen Germany Motor vehicles 84 042
12 Sanofi-Aventis France Pharmaceuticals 82 612
Source: World Investment Report, 2005, UNCTAD

Of the hundred largest

economies in the world, fifty-
one are corporations while only
forty-nine are countries.
 8 : Globalisation 211

SNAPSHOT Krispy Kreme—an expanding TNC

Krispy Kreme is an example of an American fast food company that has
recently begun to expand its operations into other countries.
✪ The company started in 1937 when French chef Vernon Rudolph sold hot
doughnuts from his shop in Winston-Salem, North Carolina.
✪ The company grew rapidly into a chain of stores (or franchises)
throughout the United States using the Krispy Kreme recipe.
[8.18] Krispy Kreme store in Penrith, the first in ✪ When Krispy Kreme opened branches in Canada it had
Australia over 290 stores operating in North America.
✪ In June 2003, Krispy Kreme opened a branch in
Penrith in Sydney’s western suburbs [8.18].
✪ In September 2003, it also opened a store in London,
in the famous Harrods Food Hall.
✪ There are now more than 360 Krispy Kreme stores
in the United States, Canada, Mexico, England and
Australia
✪ In Australia in 2007, there were twenty-four Krispy
Kreme stores: eighteen in New South Wales, five in
Victoria and one in the Australian Capital Territory.
✪ Today, Krispy Kreme produces approximately
7.5 million doughnuts a day worldwide.

tariff Developments in international trade

a tax on goods coming
into a country Recent history has shown that if countries trade more freely with each other,
quota they will gain economic benefits and higher living standards. Consumers
a limit placed on the benefit from cheaper goods and services and more variety. Despite the
volume of certain
products coming into obvious benefits that international trade provides, some countries feel
a country
they need to protect their domestic industries by means of tariffs, quotas,
subsidy
a government payment subsidies and embargoes. However, these protection measures are seen by
to a domestic producer
to help compete with
others as inefficient, only making goods and services more expensive for
imported goods consumers. Countries can now see the benefits of signing trading agreements
embargo or banding together to form trading blocs.
a ban placed on the
import of certain goods ✪ The EU (European Union) began as a trading bloc before it became a
and services
political unit. It began (as the European Common Market) in 1957 with
trading bloc
a group of countries
six member countries. It has steadily grown in size and influence and
that forms a mutual today there are twenty-seven members. Some of these countries have even
trading relationship, giving
preference to members adopted a common currency, known as the euro.
✪ Many countries of the world are still in the process
[8.19] Container docks, Melbourne
of negotiating free trade agreements. Australia has a
trading agreement with New Zealand and Thailand
and, in 2004, signed an agreement with the United
States.
212 Geography for Global Citizens

multilateral
many-sided; involving
many countries
The EU and the WTO
are global organisations.
Other global
organisations are
described in chapter 10.
✪ In 1993 the World Trade Organization (WTO) was formed with the aim
of settling trade disputes and organising multilateral trade negotiations.
Today the WTO is still committed to more free trade on a global scale
through the elimination of tariffs and other restrictive trade practices.
The result of these developments has been a tremendous growth in
world trade.

The growth of financial transactions

currency
speculation
when individuals or
organisations buy and sell
foreign currency to make
a profit
Globalisation has brought about a greater volume of financial transactions
and investments by countries, businesses and individuals in projects in
foreign countries. When shares are bought in a foreign company, it is also
known as foreign investment. Currency speculation is another example of
how organisations with large reserves of money can play in world markets.
It is said that now ‘electronic money’ exists only as digits in computers and
that it can be moved around the world at the click of a mouse. Buying and
selling foreign currencies, however, can sometimes have a negative effect on
a developing country’s economy and cause its currency to lose value.
[8.20] Checking the financial markets

[8.21] Top five financial TNCs,

ranked by number of countries
1 Citigroup US
2 GE Capital Services US
3 UBS Switzerland
4 Allianz Germany
5 BNP Paribas France
Source: World Investment Report,
2005, UNCTAD

developed countries
term used to describe Changing labour patterns
countries that have high
economic productivity, Highly skilled labour can easily travel around in the ‘global village’. With
relatively high standards
of living and relatively Internet access in nearly every country, the highly educated are increasingly
democratic systems of online and in touch around the world. Professional workers from Africa are
government (for example
the US, UK, France, now working in countries in Europe and the United States. Immigrants with
Germany, Japan and
Australia) skills in computing technologies are also in high demand around the world.
developing By contrast, unskilled labour faces many hurdles. Many families are
countries
term used to describe
separated because of the tight restrictions in rich or developed countries on
the world’s poorest the immigration of unskilled labour. Globalisation may be creating a global
countries
village, but not everyone can be a global citizen.
sweatshops
factories where The exploitation of labour in developing countries is a serious issue. Many
employees are subjected big businesses use labour in overseas countries because it is cheap and the
to poor working
conditions and low rates rules that businesses have to follow are less strict. The working conditions in
of pay
 8 : Globalisation 213

the so-called sweatshops are usually very poor (see snapshot on toy-making
in China on the next page).

SNAPSHOT Making toys in China

China is the world’s biggest toy manufacturer and exporter. It manufactures
about 70 per cent of the world’s toys. Over 8000 factories churn out cheap
plastic toys for fast food restaurants, cereal boxes and various other market
outlets throughout the world. Over 75 per cent of China’s toy production is
concentrated in the south-east of the country, in the Guandong Province.
The main toy manufacturing centre
[8.22] Toy factory in China
in this province is Dongguan City, on
the eastern outskirts of Guangzhou
(previously known as Canton) not
far from Hong Kong. Dongguan’s toy
industry is now the world leader in
terms of manufacturing scale and
technical know-how. The industry had
its origins in Hong Kong but Dongguan
has now developed its own independent
brands.
A typical factory produces soft toys
and plastic toys for its clients including
McDonald’s, Mattel, KFC, Fisher-Price
and Hasbro. The American retail giant
Wal-Mart is a big customer. On an

[8.23] A look inside a typical toy-making factory

Trouble in Toytown
O ff a side alley, in a gloomy workshop
with an oil-stained cement floor, a couple
of women are pressing out plastic moulds of
toy cars, while a man with a cigarette in the
corner of his mouth is fitting them with rubber
tyres. This is the final assembly line of a
family-based business.
Nearby, up a few flights of half-broken
stairs in a decrepit building, is the Le Yuan
factory, which has about 50 workers. Shirts
are hanging to dry in the entry passage. The
supervisor, Chen—he doesn’t want to divulge
his given name—enters his small office and
sits down next to a slab of beer and a slab
of cola. A closed-circuit TV shows him the
stairway, so he can keep an eye on any goods
being carried out.
Stubbing out a cigarette in an overflowing
ashtray, he says that as well as the factory
employees he has more people around the city
doing out-work for him, assembling electronic
cars and games. Most of the toys are designed
by the factory’s owner and his family, he
says—and they may adapt them after seeing
comparable products made by others.
Ceiling fans flicker and pop music plays
as the men and women assemble the toys
adroitly, most using electric screwdrivers.
Some are pasting circuit boards into the toys
with bowls of glue and paint brushes.
At the end of the line, a worker tests
remote-controlled toys, sending helicopters
up and down. The price of such toys at the
factory door ranges from a mere $1.50 to
$5. Employees are paid by piece-work, and
often earn around $200 per month, says
Chen, ‘if they are experienced’. Most of them
have come to Chenghai from inland farming
provinces, he adds.
Chen Guangfeng, 34, owns the Fengze
toy shop in the busiest street in town, which
is crammed with similar stores. They are
essentially wholesale outlets; buyers come to
negotiate deals, and then leave it to Chen and
co to obtain the right products at the agreed
price from what he says are ‘several thousand’
toy factories in the district.
‘Everyone in the industry around the world
knows us and comes here—including quite a
few Australian customers,’ says Chen. Trends
come and go, he adds; yo-yos, for instance,
are coming back.
He has seen huge changes during his
lifetime. ‘This is my village. My parents were
farmers here, growing rice and vegetables.
Then in the 1970s one or two Hong Kong
factories shifted here, using their own
generators because there was no electricity.
‘How can I say if the change has been good
or bad? We’re richer now, but when we had no
money at least we had clean air.’
Rowan Callick, Weekend Australian,
16 December 2006
214 Geography for Global Citizens

Working hours average $2 sale, the factory in China will only make
Work: 8:00 a.m. to 12 noon
about 10 cents profit. Working conditions in the
Lunch break: 12 noon to 1:30 p.m.
Work: 1:30 pm to 6:00 pm factory are very different from those in Australia.
Dinner break: 6:00 p.m. to 7:00 p.m. Working hours, for example, are much longer, with
Overtime: 7:00 p.m. to 9:00 p.m.
Sometimes, if the factory has many orders, work may a common schedule as shown left.
extend until 10:30 p.m. or even midnight.
Employees normally work seven days a week with
Sunday night off, and are given one day off a month.
‘The Toy Industry in China’, China Labor Watch, September 2005
In August 2007, the world’s largest toymaker, Mattel,
was forced to recall many of its Chinese-produced toys
because of safety and health concerns.

Learning about …
1 What is a TNC?
2 List the top five TNCs listed in the table [8.17] and their home country. What is significant
about these figures, in relation to the home country? Is the situation the same with table [8.21]?
3 Give three statistics that show the global dominance of TNCs.
4 Describe the dominance of TNCs in the recorded music industry.
5 Explain the different impacts of globalisation on high-skilled labour and unskilled labour.
6 Why do many companies choose to set up in developing countries?
7 What is a sweatshop?
8 Why do you think that Penrith was chosen as the location for the first Krispy Kreme store?
9 Describe how the toy industry in China has grown and developed. Include statistics to
support your description.
10 Read the article ‘Trouble in Toytown’.
a Describe the toys being made and some of the tools being used.
b What words or phrases convey the idea that working conditions are poor?
c Explain the statement: ‘employees are paid by piece-work’.
d What impacts has the toy industry had on the farming provinces?

Learning to …
1 Working in groups, research information on one TNC and its influence in the global economy.
Try <www.globalpolicy.org> website, which may be a useful starting point. Present a brief
summary of your research to the class.
2 Find out more information about the World Trade Organization (WTO). What are its aims
and what successes or failures has it had? Refer to the website at <www.ifg.org> for
information about the WTO meeting in Hong Kong in 2005 or the WTO website at
<www.wto.org> for more recent information. Summarise your research.
3 As a class, or in groups, construct a mind map on the theme of changing patterns of labour.
4 Individually, or in groups, research the Krispy Kreme company’s website at <www.krispykreme.
com>. Write a brief report on the current situation and future expansion plans of the
company into other countries (including Australia).
5 Individually, or in groups, discuss the toy industry in China as an example of how labour can
be exploited. Discuss the concept of sweatshops and related issues in groups or as a class.
6 Find out more about the recall of toys by Mattel in August 2007. What were the reasons
given for the recall? In groups, discuss the impact this might have on the
industry in China.
 8 : Globalisation 215

Political impacts and changing global relations

nation-state The world is made up of a number of countries or nation-states, each
the political unit of
people living in a with its own system of government. Throughout history, different nation-
defined territory, with
government authority
states (like Spain, Britain, Germany, France) have become very powerful.
over their economy, Recent world events, however, point to the United States as the most
political organisation and
external security powerful nation-state by way of its supreme military and economic power.
Meanwhile, countries such as China and India are gaining in power and
influence with their high rates of economic growth and rising middle
class. Despite this, globalisation has reduced the power of the nation-
state over its people. Countries are no longer able to control the flow of
information across national boundaries. The Internet has seen to that. The
governments of countries are no longer
[8.24] Nation-states, ranked by Gross Domestic Product (GDP)
operating in controlled environments and
Rank Country GDP (in US $millions) as a result the sovereignty of the nation-
1 United States 13 000 000 state is being undermined.
2 China 10 000 000 Some nation-states form political
3 Japan 4 170 000 alliances for different purposes. The
4 India 4 160 000 European Union (EU) is one such
5 Germany 2 600 000
example. The Soviet Union is an example
6 United Kingdom 2 100 000
of a past alliance. Countries formed
7 France 1 900 000
alliances following the September 11
8 Italy 1 800 000
terrorist attacks in 2001. Then there was
9 Russia 1 720 000
a so-called ‘coalition of the willing’
10 Brazil 1 700 000
involved in the Iraq War. These alliances
Note: Gross Domestic Product is the total value of all goods and services produced
in a country in a year. Australia is ranked 18th. change according to political influences
Source: World Trade Organization, 2007 and circumstances.
sovereignty [8.25] The EU has its own parliament, located in Strasbourg,
the right to rule; power
to the nation-state over near the border of France and Germany
the population that
occupies the territory
216 Geography for Global Citizens

Learning about …
1 What is a nation-state? List some examples not already mentioned in the text.
2 How has the role of the nation-state changed over time as a result of globalisation?
3 Explain the phrase ‘the sovereignty of the nation-state is being undermined’.
4 Study table [8.24].
a How many European countries are in the table? Name them.
b From the information in the table, how would you describe the United States?
c Name three Asian nation-states that have experienced tremendous growth in
recent years. Suggest some possible reasons for this growth.
5 How has the issue of terrorism changed the way nations deal with one another? You
might consider the cooperation between the United States, Russia and China after the
events of September 11 in 2001.
6 What is the European Union? What is its purpose?

Learning to …
1 Draw a mind map to show the role of the nation-state and how it has changed
over time.
2 How is the role of government different today than in the past?
3 Working in groups, use the Internet to research one of the following topics. Prepare
an oral or a written presentation on your research to the rest of the class.
a The formation of the EU
b Current events in the EU, especially new membership applications
c The introduction of the euro currency
4 As a class, discuss the role that the United States plays as a global citizen. What are
the positive and negative aspects of this role?

For more information on

global inequalities see
Positive and negative impacts of globalisation
chapter 9. The term ‘globalisation’ often sparks widespread debate. Is it good for some
and bad for others? Is it good for everybody, rich or poor? There are no
[8.26] ‘Enter his Royal Globalness ...’ simple answers to these questions as the whole
concept of globalisation is a complex one. The
cartoon [8.26], for example, demonstrates
only one aspect of the globalisation process.
Some of the arguments for and against
globalisation are shown in table [8.27].
The negative impacts of globalisation are
constantly being highlighted by the ‘anti-
globalisation movement’. Protesters, many
of them from the developed countries, voice
their opinions and demonstrate outside
the meetings of various international
organisations.

Source: www.CartoonStock.com
 8 : Globalisation 217

[8.27] The arguments for and against globalisation

For
Globalisation unites the world. There is now more wealth and
technology, and a commitment to a global community, than
ever before.
Globalisation offers enormous potential to rid the world of
poverty in the twenty-first century.
It has helped reduce poverty in some poorer countries. China
and India now have booming economies as millions of people
have been lifted out of poverty.
It is the driving force towards new prosperity in which poorer
countries can catch up in the world economy.
Globalisation increases freedom and choice. It means that more
people around the world have more information available
to them.
Globalisation means that we learn a lot more about other
countries and cultures.
International organisations such as APEC and the G8 group of
countries meet regularly to try to resolve world problems.
The freeing up of international trade can help developing
countries to grow through their expanding exports.
Against
In terms of technology, there is a digital divide. For example,
some countries and individuals have better access to the
Internet
than others.
Big business and industry take advantage of poorer countries
by using cheap labour, setting up factories in countries where
workforce rules and regulations are not as tough.
Indigenous people are deeply concerned that the ongoing
process of globalisation is leading to a denial of indigenous
people’s rights to their ancestral territories and their spiritual
perspective on land and development.
Very few of the richer nations have met their earlier promise
to allocate 0.7 per cent of their income to poorer nations for
development purposes. The gap between the rich and the poor,
according to some people, is growing.
There is an emergence of an increasingly Western-dominated
international culture—there is a fear that many traditional
cultures will be taken over by Western culture.
Globalisation is creating a ‘borderless’ world in which economic
decisions are made, where some nations do not have a say.
Some people believe that globalisation will worsen
environmental problems and poverty in the world.
Struggling economies of the world are being dragged into a
‘free trade’ global economy in which only the fittest will
survive. Global opportunities are unevenly distributed between
countries and people.

In Brazil the richest 20 per cent

receives thirty times more than
Learning about … the poorest 20 per cent.

1 Explain why there are differing opinions on the impact of globalisation.

2 Give three positive and three negative impacts of globalisation.
3 Do you believe globalisation has had more of a positive or negative impact on society?
Explain.
4 Look at table [8.27] showing arguments for and against globalisation.
a Explain the concept of a ‘borderless world’.
b What impact has globalisation had on indigenous people?

Learning to …
1 Conduct a class debate on the topic: ‘the negative impacts of globalisation outweigh the
positive impacts of globalisation on society as a whole’.
2 Working in groups, research the latest information on the anti-globalisation movement.
Discuss the arguments for and against recent demonstrations.
3 Imagine you live in a poor country in Africa and are visiting a wealthy country in Europe,
the United States or Australia. Write a letter home to your family, telling them of your
new experiences and the differences you observe there.
218 Geography for Global Citizens

Using and interpreting cartoons in

geography
The use of cartoons can be a very valuable tool in getting messages or ideas
across. It is also a fun way to learn some aspects of geography, especially
political geography and geographical issues. Cartoons have been widely
used in newspapers and magazines to communicate ideas. It is the idea
behind the cartoon rather than its artistic quality that counts. Cartoonists
use caricatures, which are pictures or drawings that emphasise and
exaggerate peculiarities of people or things, usually in a humorous way.
There are single-frame cartoons (such as the one on page 198 and [8.26])
and strip cartoons (for example [8.6]) earlier in this chapter. You will be
familiar with some of the more famous strip cartoons that are contained in
daily newspapers.

How to interpret a cartoon

✪ Study the cartoon to gain a first impression—a general feel for what
message it is trying to convey.
✪ Look at the detail in the cartoon to find any hidden meanings.
✪ Try to get to the idea behind the cartoon, that is, the message being
conveyed. What would the cartoonist say if they were to put the idea
into words? If the cartoon has words, what alternative words could you
suggest? What alternative words convey a different meaning?
✪ Consider the question of bias. Is the message reinforcing stereotypes, or
is the cartoonist taking a strong view on an issue, or an unpopular view?
✪ Consider the geographical implications of the cartoon. What can you
learn from it?

How to draw a cartoon

Follow these steps when creating a cartoon:
✪ You need to start with a topic and then an idea related to that topic. For
example, if there is a news story about a local, national or global event,
you might consider a particular angle.
✪ Consider the people involved and how you can caricature them.
✪ Consider the setting and any signs or hints as to where the place is.
✪ Draw the basic outline, then add finer details to fill in your idea.

Skills activities
1 What message is being conveyed in cartoon [8.26]? How is the illustrator
conveying this message?
2 Look at two cartoons in this book other than those in this chapter and
write a sentence outlining the main message being communicated
in each.
3 Design a strip cartoon that shows either the economic and cultural
factors shaping the world today as part of globalisation, or the impacts
of globalisation.