global economy - arazen's report

8/8/2019 Global Economy - Arazen's report

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GLOBALECONOMY


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GLOBAL ECONOMY

It refers to the economy, which is based on economies ofall of the world's countries, national economies. Alsoglobal economy can be seen as the economy of globalsociety and national economies - as economies of localsocieties, making the global one.

It refers to an integrated world economy with unrestrictedand free movement of goods, services and labortransnationally. It also projects the picture of anincreasingly inter-connected world with free movement ofcapital across countries. The concept of a global economycannot be understood in isolation.

It is inseparable from the geography and ecology of earth,and is therefore somewhat of a misnomer, since, whiledefinitions and representations of the "world economy"vary widely, they must at a minimum exclude anyconsideration of resources or value based outside ofthe earth.


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ADVANTAGE & DISADVANTAGE OF GLOBAL

ECONOMY:

Advantage:

The global economy can reap the benefits of increasingeconomies of scale. With the opening up of the economy theindustrial sector has benefited with the attainment of cheaplabor, capital and technology. Small companies also witness

rapid growth owing to a wider customer base. Many opine thatthe global economy has promoted international peace andcooperation.

Disadvantage:

The global economy has encouraged transportation on awider scale for the free flow of goods and services acrossnations. This has , in turn, led to the emission of greenhouse

gases. The global economy has also resulted in the loss ofdomestic jobs. The labor intensive industries of the developedcountries find it profitable to shift to third world countrieswhere wage rates are low. This leads to the displacement oflabor in the developed countries. Further, it is difficult toformulate regulations and legislations that areundifferentiated across the globe.


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GLOBALIZATION

It describes a process by which regionaleconomies, societies, and cultures have becomeintegrated through a global network ofcommunication, transportation, and trade. Theterm is sometimes used to refer specificallyto economic globalization: the integration ofnational economies into the internationaleconomy through trade, FDI, capitalflows, migration, and the spread of technology.

It is the integration of production andconsumption in all markets across the world.


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GLOBAL RULE MAKERS

WTO

World Bank

International Monetary Fund (IMF)

Trade Agreements

Alternatives

Rights-Based Agreements


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WORLD TRADE ORGANIZATION

- is an organization that intends to supervise andliberalize international trade. The organization officiallycommenced on January 1, 1995 under the Marrakech

Agreement, replacing the General Agreement on Tariffsand Trade (GATT), which commenced in 1948.

- The organization deals with regulation of trade betweenparticipating countries; it provides a framework fornegotiating and formalizing trade agreements, and adispute resolution process aimed at enforcing participants'adherence to WTO agreements which are signed by

representatives of member governments and ratified bytheir parliaments.

- The WTO has 153 members, representing more than 97%of total world trade and 30 observers, most seekingmembership.


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- The WTO's predecessor, the General Agreement on

Tariffs and Trade (GATT), was established

after World War II in the wake of other newmultilateral institutions dedicated to international

economic cooperation notably the Bretton Woods

Institutions known as the World Bank and the IMF.

- The WTO is governed by a ministerial conference,meeting every two years; a general council, which

implements the conference's policy decisions and is

responsible for day-to-day administration; and a

director-general, who is appointed by the ministerial

conference.- The WTO's headquarters is at the Centre William

Rappard, Geneva, Switzerland.


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WORLD BANK

- It is a term used to describe an international financialinstitution that provides leveraged loans to developingcountries for capital programs. The World Bank has astated goal of reducing poverty. By law, all of its decisions

must be guided by a commitment to promote foreigninvestment, international trade and facilitate capitalinvestment.

- The World Bank is one of five institutions created atthe Bretton Woods Conference in 1944. IMF, a related

institution, is the second. Delegates from many countriesattended the Bretton Woods Conference. The mostpowerful countries in attendance were the UnitedStates and United Kingdom which dominated negotiations.


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INTERNATIONAL MONETARYFUND

(IMF)

- is the intergovernmental organization that overseesthe global financial system by following themacroeconomic policies of its member countries, in

particular those with an impact on exchange rate andthe balance of payments.

- It is an organization formed with a stated objective ofstabilizing international exchange rates andfacilitating development through the enforcement ofliberalizing economic policies on other countries as a

condition for loans, restructuring or aid.- It also offers highly leveraged loans, mainly to poorer

countries. Its headquarters are in Washington,D.C., United States.


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- The International Monetary Fund was created in July1945, originally with 45 members, with a goal tostabilize exchange rates and assist the reconstruction

of the world's international payment system.

- The IMF was important when it was first createdbecause it helped the world stabilize the economicsystem. The IMF works to improve the economies ofits member countries.

- The IMF extends short-term credit to nations unableto meet their debts through conventional means(generally, by increasing exports, taking out long-term loans, or using reserves). The IMF, to which the

United States contributed 25 percent of an initial$8,800 million in capital, often requires chronicdebtor nations to undertake economic reforms as acondition for receiving its short-term assistance.


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SUPRANATIONAL ORGANIZATION

European Union (EU)

EU is an economic and political union of

27 member states which are located primarilyin Europe. Committed to regional integration , the

EU was established by the Treaty of Maastricht in

1993 upon the foundations of the European

Communities. Formerly known as European

Community (EC) or European Economic Community

(EEC). The EU operates through a hybrid system of

supranationalism and intergovernmentalism.


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MEMBERS OF EU:

Austria

Belgium

Bulgaria

Cyprus Czech Republic

Denmark

Estonia

Finland

France

Germany

Greece

Hungary

Ireland

Italy

Latvia

Lithuania

Luxembourg

Malta Netherlands

Poland

Portugal

Romania

Slovakia

Slovenia

Spain

Sweden

United Kingdom


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INTERNATIONAL LABOR

ORGANIZATION

- is a specialized agency of the UN that dealswith labor issues. Its headquarters arein Geneva, Switzerland. Its secretariat the people who areemployed by it throughout the world is known as the

International Labour Office.

- The organization received the Nobel Peace Prize in 1969.The ILO was established as an agency of the League ofNations following the Treaty of Versailles, which

ended World War I.- It protect labors & their union.

- It sponsored treaties in more specialized areas of humanrights law


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global economy - arazen's report

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