TOPIC 1: INTERNATIONAL TRADE SYSTEM 5 Fundamentals (reasons) for International Trade

➢ International trade system - network of laws, regulations, and agreements that • DIFFERENCES IN TECHNOLOGY
govern the exchange of goods and services between countries. It includes importing • DIFFERENCES IN RESOURCES
and exporting products and services across borders and the various rules and • DIFFERENCES IN DEMAND
regulations that impact international trade
• ECONOMIES OF SCALE
ITS- such as the Silk Road, connecting China, The galleon trade, a part of the • GOVERNMENT POLICIES
Middle East, and Europe, was a profitable mercantilism era, connected Manila and
trade route from 130 BCE to 1453 BCE, but Acapulco. The gold standard, adopted in ➢ International Trade System in Marketing- promoting a product internationally is
globalization began with continuous 1867, was restrictive and many countries challenging but offers opportunities like broad customer base and market reach.
product exchange between populated abandoned it during World War I. Identifying entry modes like exporting, licensing, franchising, foreign direct investment,
continents. and joint ventures determines the marketing approach.

TOPIC 2: THE BRETTON WOODS SYSTEM

➢ After the two world wars, world leaders sought to create a global economic system
Examples of WORLD TRADE SYSTEM (WTO) that would ensure a longer-lasting global peace.
➢ The Bretton Woods system was inaugurated in 1944 during the United Nations
❖ World Trade System (WTS)- largest global trade system in the world. Its main tasks
Monetary and Financial Conference to prevent the catastrophes of the early decades
include fostering international trade while maintaining rules for global economic
of the century from reoccurring and affecting international ties.
transactions. ➢ The Bretton Woods system was largely influenced by the ideas of British economist
❖ North American Free Trade Agreement (NAFTA)- a trade agreement between the John Maynard Keynes
United States, Canada, and Mexico designed to promote free trade between the three ➢ When economies slow down, according to Keynes, governments have to reinvigorate
countries. Under NAFTA, tariffs and other trade barriers were gradually eliminated, markets with infusions of capital.
making it easier for companies to do business across borders. ➢ This active role of governments in managing spending served as the anchor for what
❖ Association of Southeast Asian Nation (ASEAN)- in 1992, the agreement on the would be called a system of global Keynesianism.
Common Effective Preferential Tariff (CEPT) Scheme for the ASEAN Free Trad Area TWO FINANCIAL INSTITUTIONS
(AFTA) was signed in Singapore, paving the way for ASEAN to establish a single market 1.) International Bank for ➢ responsible for funding postwar
and production base. Reconstructions and Development reconstruction projects.
(IBRD or World Bank)
➢ Global Value Chain- a process whereby parts of goods are produced in multiple 2.) International Monetary Fund (IMF) ➢ global lender of last resort to
countries before being assembled into a final product and shipped to consumers prevent individual countries from
spiraling into credit crises.
worldwide.
➢ Globalization- plays a significant role in fostering international trade. Globalization is the
process of the world becoming interconnected through trade and cultural exchange.
➢ General Agreement on Tariffs and Trade (GATTT)- Shortly after Bretton Woods,
➢ International Trade- takes place because no country is self-sufficient. It has to import
various countries also committed themselves to further global economic integration
materials or products it lacks while selling the extra goods it produces.
through the General Agreement on Tariffs and Trade (GATT) in 1947.
 TOPIC 3: NEOLIBBERALISM and ITS DISCONTENTS individual seek private solution to
Neoliberalism- A policy model that encompasses both politics and economics and seeks to Growth of Informal Economy compensate for unemployment and lack of
transfer the control of economic factors from the public sector to the private sector. social benefits.

An Economic Ideology that Emphasizes

Free Markets
Openness
Privatization
Potential Benefits
Economic Growth
Foreign Investment
Reduced Bureaucracy
Criticized Drawbacks
Environmental Damage
Financial Instability
Widening Inequality
Social Neglect
NEOLIBERALISM and ITS DISCONNECTS
Negative Impact on Latin America
Contradictions with claimed benefits
Neo-colonization
Minimal government intervention, competition
as the driving force for growth.
Free trade, deregulation, globalization of
capital, goods, and services.
Transferring ownership of public services and
assets to the private sector.
Increased competition, innovation and
efficiency
Access to capital, infrastructure development,
and technology.
Streamlined processes and potentially less
corruption.
Prioritizing profit over sustainability leads to
degradation and resource depletion.
Deregulation increases risk-taking and
potential for financial crises.
Unfettered markets benefit the wealthy
disproportionately.
Decreased government spending on social
programs harms vulnerable populations.
GENERAL CRITIQUE OF NEOLIBERALISM
Dramatic economic restructuring, foreign
takeovers, rising unemployment, poverty and
informal economy growth.
Widening Inequality: undermining social
cohesion and stability.
Diminished state capacity: unable to address
social needs and infrastructure development.
Dependence on international financial
institutions and transnational corporations.
➢ Rising Unemployment and Poverty- dismantling of the state, including privatization
and budget cuts, leads to faster rises in unemployment and poverty levels than at any
other time in the region's history.
➢ Loss of National Independence and Economic Development- Governments have
virtually abandoned efforts to achieve national independence and economic
development, as policies are directly managed by international financial institutions
and transnational capital
➢ Neo-colonization- Neoliberalism is synonymous with the definitive neo-colonization
of Latin America, where policies are dictated by international financial institutions
and transnational corporations.
➢ Social Consequences- Neoliberalism results in various social consequences,
including increased crime rates, more children in the streets, fewer benefits for
retired people, exploitation of urban and rural workers, impoverishment of the middle
class, and limited opportunities for youth and women
➢ Lack of Resistance and Struggle- Despite the evident social and human suffering
caused by neoliberalism, there is a lack of significant resistance and struggle against
the system, partly due to ideological and political roadblocks.
➢ False Perceptions- Many affected individuals believe that the neoliberal system can
work, leading to resignation and apathy among the marginalized poor and some
sectors of the working class who fear for their jobs.
➢ Income Inequality- Neoliberal policies are often criticized for exacerbating income
inequality by favoring the wealthy and large corporations, while neglecting the needs of low-
income individuals and marginalized communities.
➢ Social Polarization- Critics argue that neoliberalism fosters social divisions and
polarization by prioritizing individualism and competition over collective
well-being and social cohesion.
➢ Deregulation- Neoliberal policies advocate for deregulating markets, which can lead
to environmental degradation, labor exploitation, and financial instability
TOPIC 3:
➢ Privatization- The privatization of public services and resources under neoliberalism
is seen as detrimental to equitable access, as it can lead to increased costs,
decreased quality, and exclusion for those unable to afford privatized services.
➢ Erosion of Social Safety Nets- Neoliberal policies often involve cuts to social welfare
programs and austerity measures, which can leave vulnerable populations without
adequate support and exacerbate poverty and inequality.
➢ Financialization- The emphasis on financial markets and profit maximization under
neoliberalism can result in speculative bubbles, economic instability, and
prioritization of short-term gains over long-term sustainability.
TOPIC 4: THE GLOBAL FINANCIAL CRISIS and THE CHALLENGE to NEOLIBERALISM
➢ Neoliberalism's "shock therapy," exemplified by Russia's experience, failed to meet
expectations. The 2008-2009 global financial crisis further highlighted the
shortcomings of this approach, originating in the 1980s with deregulation in the
United States. The crisis stemmed from unregulated investments in the US housing
market, leading to the collapse of major banks like Lehman Brothers. Its global
impact included significant losses for countries like Iceland, Spain, and Greece,
with Greece facing austerity measures imposed by Germany and the IMF, while the
US recovered relatively quickly due to a stimulus package. The crisis also triggered
political unrest in Europe.
TOPIC 5: TECHNOLOGY AND DIGITAL TRANSFORMATION
➢ Digital Transformation- use of digital technologies to modify or create new business
process, customer experiences, and organizational culture in response to changes in
the market and business needs.
➢ Pre- Internet Era (1950-1989)- foundational building blocks of the digital revolution
created.
• 1958- microchip and semiconductor invented
• 1960- Moore’s Law defined
➢ Post-Internet Era (1990-2006)- next digital era created massive change. The internet
started the shift from a siloed world into a global one.
• 1990- internet becomes publicly available
• 1998- Google founded
• 2000- Half of US households have a personal computer
• 2004- Facebook founded
• 2005- Internet users reach $1 billion worldwide
• 2006- AWS created
➢ Mobile Era (2007-2019)- opened up a world of possibilities, new business models,
and the introduction of new social and mobile channels, which drove another spike
in digital transformation.
• Marc Andreesen’s seminal writing, “Why Software is Eating the World”
• 2007- iPhone released giving rise to the mobile revolution
• 2011- “Why Software is Eating the World” written
• 2013- term “Digital Transformation” is coined
➢ Post-Pandemic Era (2020-Present)- the pandemic accelerated digital innovations as
companies were forced to rethink how they served their customers in a non-contact
and remote world.
• 2020- Global Pandemic
• 2022- Digital Transformation spending at $1.6 trillion
➢ Cloud Technology- provisioning of computing services in a flexible and scalable
manner. 3 main categories;
• Infrastructure as a Service (IaaS)
• Platform as a Service (PaaS)
• Software as a Service
 TOPIC 5 MAN-MADE POLLUTION
➢ Artificial Intelligence and Machine Learning (AI/ML)- involve simulating • Particulate matter (PM)
human cognitive process by machines. • Carbon monoxide (CO)
➢ Big Data- considered the fuel of the modern economy and is an invaluable resource for • Ozone (O3)
most organization. • Nitrogen dioxide (NO2)
➢ Real Time Analytics- analysis of data and related resources as soon as it enters the
system. ➢ Climate Change- current rise in Earth's average temperature and related large-scale
➢ Internet of things and 5G- system of computing devices, machines or other objects shifts in weather patterns.
which are connected to the Internet and able to transfer data over a network.
➢ Augmented Reality- connects digital information to a visual user experience. CAUSE AND EFFECTS OF CLIMATE CHANGE
➢ Digital Twin- technology that helps bridge the gap between the physical and digital Generating Power More severe storm
worlds. Manufacturing Goods Increased drought
➢ Additive Manufacturing and 3D Printing- adds digital flexibility and efficiency to Cutting down forest Warming and rising ocean
the manufacturing processes. Using transportation Loss of species
Producing food Not enough food
TOPIC 6: CLIMATE CHANGE AND ENVIRONMENTAL ISSUES Powering buildings More health risks
Consuming too much Poverty and displacement; global warming
➢ Environmental issues are defined as harmful effects to Earth and its natural systems
due to the actions of humans.
“Global Warming and Climate Change aren’t the same”
THE WORLD’s LEADING ENVIRONMENTAL PROBLEMS
• Depredation- caused by industrial and transportation toxins and plastic in the ➢ Greenhouse Effect- process through which heat is trapped near Earth’s surface by
destruction of million-year- old ecosystems and the loss of biodiversity. substances known as ‘greenhouse gases.
• Reduction- oxygen and the increase in carbon dioxide in the atmosphere because Responding to climate change involves a two-pronged approach according to NASA:
of deforestation.
• Depletion- ozone layer protecting the planet from the sun’s deadly UV rays due to 1. Reducing emissions of and stabilizing the levels of heat-trapping greenhouse
Chlorofluorocarbon (CFC’s) in the atmosphere.
gases in the atmosphere (“mitigation”)
• Overpopulation
• Defiling- the sea, rivers, and water beds by oil spills and acid rain; the dumping of 2. Adapting to the climate change already in the pipeline (“adaptation”).
urban waste.
• Changes of the Global Weather
• Exhaustion- of the world's natural non-renewable resources from oil reserves to
minerals to potable water.
• Waste Disposal Catastrophe- due to the excessive amount of waste (from plastic
to food packages to electronic waste) unloaded by communities in landfills as well
as on the ocean; and the dumping of nuclear waste.
 TOPIC 7: ECONOMIC GLOBALIZATION TODAY
➢ Economic Globalization- Economic globalization involves cross-border trade, capital
flows, technology transfer, and labor or migration, resulting in increased
interdependence of world economies.
➢ Exports, not just local selling, drive national economies growth. In the past, advanced
nations like the US, Japan, and EU benefited the most from free trade, while developing
countries accounted for only 29%.
➢ Localizing the Material
GLOBALIZATION AND ITS EFFECT IN ECONOMIC GROWTH
• Foreign direct investment (FDI)- tends to grow at a much greater rate than world
trade does. This can help to boost technology transfer, industrial restructuring, and
the growth of global companies.
• Technical Innovation- Increased competition helps inspire new technology development.
The growth in FDI helps improve economic output by making processes more efficient.
• Economic of Scales- Increased global trade enables large companies to realize
economies of scale. This reduces costs and prices, which in turn supports further growth.
However, this can hurt many small businesses trying to compete at home.
• Interdependence- between nations can cause local or global instability.
occurs if local economic fluctuations end up impacting a large number of countries
relying on them.
• Threat of Sovereignty- Some see the rise of nation-states, global firms, and other
international organizations as a threat to sovereignty. Ultimately, this could cause some
leaders to become nationalistic.
In the Philippines today, economic globalization is significant
• Increased Exports: The country has actively participated in global trade, with a
notable increase in exports contributing to economic growth.
• BPO Industry: The Business Process Outsourcing (BPO) sector has flourished,
becoming a key player in the global outsourcing market.
• Remittances: The overseas Filipino workforce contributes significantly to the
economy through remittances, highlighting the global interconnectedness.
• Foreign Direct Investment: Attracts foreign direct investment, fostering economic
development and infrastructure projects.
• Challenges: However, challenges include addressing income inequality, ensuring
fair labor practices, and navigating the impact on local industries.
• Balancing the benefits and challenges is crucial for the Philippines as it continues to
navigate the complexities of economic globalization.
EXAMPLES OF GLOBALIZATION
• Technological Globalization- people are interconnected via different social media
platforms.
• Financial Globalization- linked with the rise of a global financial system with
international financial exchanges and monetary exchanges.
• Economic Globalization- development of trade systems within transnational
actors such as corporations or NGOs.
• Political Globalization- development and growing influence of
international organizations such as the UN or WHO means governmental action
takes place at an international level.
• Cultural Globalization- interpenetration of cultures which, as a consequence,
means nations adopt principles, beliefs, and costumes of other nations, losing t
their unique culture to a unique, globalized supra-culture.
• Ecological Globalization- accounts for the idea of considering planet Earth as a
single global entity – a common good all societies should protect since the
weather affects everyone and we are all protected by the same atmosphere.
• Geographic Globalization- new organization and hierarchy of different regions of the
world that is constantly changing.
• Sociological Globalization- information moves almost in real-time, together with the
interconnection and interdependence of events and their consequences. People
move all the time too, mixing and integrating different societies