Contemporary World Reviewer

UNIT 1: INTRODUCTION TO GLOBALIZATION

LESSON 1: DEFINING GLOBALIZATION

Globalization refers to the process by which more people across large distances become
connected in more and different ways. They can become connected very simply by doing or
experiencing the same sort of things. For example, Japanese cuisine “globalizes” when more
people on different continents enjoy the test of the sushi. Since the 19th century Soccer has
become globalize as player and fans in many countries took an interest in the game.

THE FORCES OF GLOBALIZATION

• Globalization is an interaction of people and primarily an economic process of

integration which has social and cultural aspects as well
• Such instructions, which have emerged in many areas of human activity, reflect
increasingly common knowledge and awareness.
• Eating sushi and getting a hepatitis Bs shot involve elements of world culture- the
meaning of sushi and patients regardless of their location
• Even they do not know the larger structures, their everyday life is nevertheless
embedded in a world culture that transcends their village, town, or country and that
becomes part of individual and collective identities.
• Globalization thus involves growing diffusion, expanding interdependence, more
transnational institutions, and an emerging world culture and consciousness- all aspects
of the connectedness at the heart of globalization, all elements of the world
globalization is creating (Lechner, 2015)
THE MEANING OF GLOBALIZATION
Globalization is the set of processes by which more people become connected in more
and different ways across ever-greater distances.
A more academic version of this idea is to equate globalization with
“deterritorialization”, the process through which the constrains of physical space lose their hold
on social relations.
It is also defined as the process by which capitalism expands across the globe as
powerful economic actors seek profit in global markets and impose their rules everywhere, a
process often labeled “Neoliberalism.”
THE MEANING OF GLOBALIZATION TO DIFFERENT PEOPLE
According to Lechner (2015), globalization means different things to different people.
 • To a Korean Pentecostal missionary, it means a new opportunity to spread the faith and
convert lost souls abroad.
• To a Dominican immigrant in the United States, it means growing new roots while
staying deeply involved in the home village
• To an Indian television viewer, it means sampling a variety of new shows, some adapted
from foreign formats.
• To a Chinese apparel worker, it means a chance to escape rural poverty by cutting
threads off designer jeans
• To an American shoe company executive, it means managing a far-flung supply chain to
get products to stores.
• To a Filipino global justice advocate, it means rules of the global game that favor the rich
North over the poor South.
THEORIES OF GLOBALIZATION
According to Lechner (2015) states the following are the theories or perspective in the
emergence of globalization:

1. World-System Theory
• A perspective that globalization is essentially the expansion of the capitalist system
around the globe.
• At the time Marx was writing in the mid-nineteenth century, the world was becoming
unified via thickening networks of communication and economic exchange
• At the “core” of the system, resources, and trade opportunities, most notably in
“peripheral” areas.
• Buffer countries in the “semi periphery” helped mitigate tensions between core and
helped to keep the system remarkably stable.
• The central purpose of the world system is capital accumulation by competing firms,
which go through cycles of growth and decline.
2. World Polity Theory
• In this theoretical perspective, state remains an important components of world society,
but primary attention goes to the global cultural and organizational environment in
which states are embedded.
• What is new in world society, from this perspective, is the all encompassing “world-
polity, and its associated world culture, which supplies a set of cultural rules or script
that specify how institution around the world should deal with common problems.
• Globalization is the formation and enactment of this world polity and culture.
• One of the world polity’s key elements is a general, globally legitimated model of how to
form a state.
• Guided by this model, particular states widely varying circumstances organize their
affairs in surprisingly similar fashion.
 • Because world structured as a polity with an intensifying global culture, new
organization-business enterprises educational institutions, social movements, leisure
and hobby groups, and so on-spring up in all sorts of countries to enact it precepts.
• As a carrier of global principles, these organizations then help to build and elaborate
world culture and world society further.

3. World Culture Theory

• This perspective agrees that world culture is indeed new and important, but it is less
homogenous than world-polity scholars imply.
• Globalization is a process of relativization.
• Societies must make sense of themselves in relation to a larger system of societies while
individuals make sense of themselves as a larger whole in relation to a sense of
humanity as a larger whole.
• World society thus consists of a complex set of relationship among multiple units in the
“global field”. In this model, world society is governed not by a particular set of values
but by the confrontation of different way of organizing this relationship.
• Globalization compresses the world into a single entity, and people necessarily become
more aware of their relationship to this global presence.
• Of central importance to this process is the problem of “globality”: how to male living
together in one global system meaningful or even possible.
• Not surprisingly, religious traditions take on new significance insofar as they address in
new predicament that compels societies and individuals to “identify themselves in new
ways.
• It concludes that a “search for fun fundamentals” is inherent in globalization.

REASONS WHY GLOBALIZATION WILL NOT MAKE THE WORLD HOMOGENEOUS

According to Lechner (2015), the reasons why globalization will not lead to a
homogeneous world are:

1. General rules and models are interpreted in light of local circumstances. Thus, regions
respond to similar economic constraints in different ways; countries still have great
leeway in structing their own policies; the same television program means different
thighs to audiences; McDonald's adapts its menu and marketing to local tastes.
2. Growing similarity provokes reactions. Advocates for many cultures seek to protect their
heritage or assert their identity. Witness the efforts of fundamentalists to reinstate what
they consider orthodoxy, the actions of indigenous people to claim their right to cultural
survival.
3. Cultural and political differences have themselves become globally valid. The notion that
the people and countries are entitled to their particularity of distinctiveness is itself part
 to global culture. The tension between homogeneity and heterogeneity is integral to
globalization.

THE INTERDISCIPLINARY UNDERSTANDING OF GLOBALIZATION

1. Political Scientist
• With global ecological changes, an ever more integrated global economy, and other
trends, political activity increasingly takes place at the global level.
• Under globalization, politics can take place above the state through political integration
schemes such as the European Union, the ASEAN integration where Philippines is involved,
though the intergovernmental organizations such as the International Monetary Fund, the
World Bank and the World Trade Organization.
• Political activity can also transcend national borders through global movements and
Non-Governmental Organizations (NGO’s). Civil society organizations act globally by
forming alliances with organizations in other countries, using global communication
systems, and lobbying international organizations and other actors directly, instead of
working though their national governments (Global Policy Forum 2017).
2. Economist
• According to Franker (2017), economists have his own view of globalization.
• First, it is integration through international trade of markets in goods and services as a
reflected in variety of possible measures.
• These include direct measures of barriers like tariffs and transport costs, trade volumes
and price related measures. Globalization also means foreign direct investment,
increased trade in intermediate product, international outsourcing of services like the call
center industry here in the Philippines, and international movement of persons like our
Overseas Filipino Workers (OFW).
• Globalization would also include the international spread of ideas, from consumer tastes
like Coke and Hershey’s to intellectual ideas like technological patents and management
principles and accounting standards.

3. Sociologist
• Cole (2017) states that globalization, according to sociologists is an ongoing process that
involves interconnected changes in cultural and social spheres.

As • a process, it involves the spread and diffusion of ideologies-values, ideas, norms, beliefs
and expectations-that foster, justify and provide legitimacy for economic and political
globalization.
• It fueled by globally integrated communication systems like social media such as Facebook
and Twitter, media coverage of the world’s elite and their lifestyles, the movement of
people around the world via business and leisure travel, and the expectation of these
 travelers that host societies will provide amenities and experiences that reflect their
own cultural norms.

4. Historian
• Historians follow rather than led the way.
• Globalization is not new as a phenomenon but the word itself took hold only recently
which records shows first use in English in 1930 and shows that usage soared suddenly
in the 1990’s.
• Why globalization “hot” now and what does it portend for the study of history. Hunt
(2014) states that globalization defined most succinctly as the interconnection of places
far distant from each other.
• When the Soviet Union collapse and end the Cold War globalization filled the ideological
vacuum created by the end of Cold War division between Capitalism and Communism.

• Cultural history has lost its luster. Theory no longer excites passionate and debate and
perhaps most important, the nation-state no longer seems as self-evident as the
necessary unit of historical analysis. Moreover, globalization is still too much entangled
with world history, global history and transnational history.

MARKET GLOBALISM

• Market globalism is an idea that reflects the concepts of globalization. It seeks to endow
globalization with free market norms and neoliberal meanings. Steger (2005) states that
the term ‘globalization’ gained in currency in the late 1980s. The persistence of
academic divisions on the subject notwithstanding, the term was associated with
specific meanings in public discourse during the 1900s. With the collapse of Soviet-style
communism in Eastern Europe, loosely affiliated power elites concentrated in the global
north stepped up their ongoing efforts to sell their version of ‘globalization to the public
in the ideological form of ‘market globalism’.
• These power elites consisted chiefly of corporate managers, executives of transnational
corporations, corporate lobbyist, high-level military officers. Prominent journalist and
public-relations specialist, intellectual writing to a large public audience, state bureaucrats and
influential politicians. By the mid-1990s, large segments of the population in both the global
north and south had accepted globalism core claims., this internalizing large parts overarching
neo-liberal framework that advocate the deregulation of markets, the liberalization of trade,
the privatization of state-owned enterprises.
THE FIVE CORE CLAIMS OF MARKET GLOBALISM

The five core claims of market globalism according to Steger (2205) are:
1. Globalization is about liberation and global integration of markets The first claim of
market globalism is anchored in the neo-liberal ideal of the self-regulating market as the
normative basis for a future global order.
According to this perspective, the vital functions of the free market – its rationality and
efficiency, as well as its alleged ability to bring about greater social integration and
material progress – can only be realized in a democratic society that values and protects
individual freedom. Embracing the classical liberal idea of the self-regulating
market, Claim One seeks to establish beyond dispute ‘what
globalization means,’ that is, to offer an authoritative definition of globalization designed
for broad public consumption.

It does so by interlocking its two core concepts and then linking them to the adjacent
ideas of ‘liberty’ and ‘integration.’ Globalization is about the triumph of markets over
government. Both proponents and opponents of globalization agree that the driving
force today is market, which are suborning the role of government. The truth is that the
size of governments has been shrinking relative to the economy almost everywhere. The
driving idea behind of globalization is free-market capitalism – the more you let market
forces rule and the more you open your economy so free trade and competition, the
more efficient your economy will be, globalization means the spread of free-market
capitalism to virtually every country in the world.
2. Globalization is inevitable and irreversible

The second mode decongesting ‘globalization’ turns on the adjacent concept of

‘inevitability’. At first glance, the belief in the historical inevitability of globalization
seems to be a poor fir for a globalist ideology based on neo liberal principles. According
to the marketglobalist perspective, globalization reflects the spread of irreversible
market forces driven by technological innovations that make the global integration of
national economies inevitable. In fact, market globalism is almost always intertwined
with the deep belief in the ability of markets to use new technologies to solve social
problems far better than any alternative course. Governments, political parties, and
social movements had no choice but to ‘adjust’ to the inevitability of globalization. Their
sole remaining task was to facilitate the integration of national economies in the new
global markets.
3. Nobody is in charge of globalization

The third mode of de-contesting globalization hinges on the classical liberal concept of
the ‘self-regulating market.’ The link between ‘globalization-market’ and the adjacent
idea of ‘leader lessness’ is simple: if the undisturbed working of the market indeed
preordains a certain course of history, then globalization does not reflect the arbitrary
agenda of a particular social class or group. In other words, globalist is not ‘in charge’ in
the sense of imposing their own political agenda on people. Rather, they merely carry
out the unalterable imperatives of a transcendental force much larger than narrow
 partisan interest. The idea that nobody is in charge serves the neo-liberal political
agenda of defending and expanding global capitalism. Like the market-globalist rhetoric
of historical inevitability, the portrayal of globalization as a leaderless process seek to
both depoliticize the public debate on the subject and demobilize global justice
movements. The deterministic language of a technological progress driven by
uncontrollable market law turns political issues into scientific problems of
administration. As ordinary people cease to believe in the possibility of choosing
alternative social arrangements, market globalism gains strength in its ability to
construct passive consumer identities. This tendency is further enhanced by assurances
that globalization will bring prosperity to all parts of the world.

4. Globalization benefits everyone

This de-contestation chain lies at the heart of market globalism because it provides an
affirmative answer to the crucial normative question of whether globalization
represents a ‘good’ phenomenon. The adjacent idea of ‘benefits for everyone’ is usually
unpacked in material terms such as ‘economic growth’ and ‘prosperity’. However, when
linked to globalism’s peripheral concept, ‘progress.’ the idea of ‘Benefits for everyone’
taps not only into liberalism’s progressive worldview, but also draws on the powerful
socialist vision of establishing an economic paradise on earth –albeit in the capitalist
form of a worldwide consumerist utopia Thus, Claim Four represents another bold
example of combining elements from seemingly incompatible ideologies under the
master concept ‘globalization.’ Even those market globalist who concede the strong
possibility of unequal global distribution patterns nonetheless insist that the market
itself will eventually correct these irregularities, television, radio and the internet
frequently place existing economic, political and social realities within a neo-liberal
framework sustaining the claim that globalization benefits everyone through
omnipresent affirmative images, websites, banner, advertisements, and sound bites.
5. Globalization furthers the spread of democracy in the world
The fifth de-contestation chain links ‘globalization’ and ‘market’ to the adjacent concept
of ‘democracy’ which also plays a significant role in liberalism, conservatism and
socialism. Indeed, a careful discourse analysis of relevant text reveals that globalist tend
to treat freedom, free markets, free trade and democracy as synonymous terms.
Persistently affirmed as common sense, the compatibility of these concepts often goes
unchallenged in the public discourse. The most obvious strategy by which neo-liberals
generate popular support for the equation of democracy and the market are by
discrediting traditionalism and socialism After all, the contest with both pre capitalist
and anti-capitalist forms of traditionalism such as sovereignty and individual rights have
been enshrined as the crucial catalyst for the technological and scientific achievements
of modern market economies.
THE GLOBALIZATION EXPERIENCE
No one experience globalization in all its complexity but globalization is significant
insofar as it reshapes the daily lives of billions of people. Increasingly, the larger the world is
present locally. The obvious applies to a Bill Gates (founding chairman of Microsoft), conscious
contributors to globalization. American textile workers sense the global in the local through the
impact of intense foreign competition and outsourcing to overseas companies. Soccer fans
regard as routine the fact to the World’s Cup every four years, Business people travelling
internationally witness globalization daily in the media offerings in their hotel rooms. Migrants’
wo call home, send money back, or make return visits bring a bit of that wider world to the
villages they left. These people, and many more, experience globalization. Experiencing
globalization, as the examples indicate, do not mean that some abstract, impersonal force
overwhelms individuals. People participate and respond in different ways. They can shape,
resist, absorb, or try to avoid globalization. They can seek opportunity in it, feel the harm of it,
or lament the power of it. For some, globalization is a central reality; for others; it is still on the
marine of their lives. In short, there is no one experience of globalization. That, in itself, is an
important aspect of the process. The formation of a new world society does not involve all
people in the same way and it does not create the same texture in everyone’s everyday life. But
there are some commonalities in the global experience of globalization. To one degree of
another, globalization is real to almost everyone. It transforms the prevailing sense of time and
space, now globally standardized. Its envelope everyone in new institutions. It poses a
challenge, in the sense that even marginally affected groups must take a stance toward the
world. Globalization raises identity problems for societies and individuals alike.
Focusing on a different kind of global food, James L. Watson, another anthropologist, describes
McDonalds’s customers in Hong Kong, including children, as critical consumers to whose
expectations about food and service the multinational corporation must adapt. Far from
imposing a new dietary standard McDonalds’s blended into an already heterogeneous urban
landscape. Watson concludes that in places like Hong Kong, the transnational is the local.
How does one explain the phenomenal success of American-style fast food in Hong Kong and,
increasingly, in Guangzhou – the two epicenters of Cantonese culture and cuisine? Seven of the
world’s ten busiest McDonalds’s restaurants are located in Hong Kong. When McDonalds’s fist
opened in 1975, few thought it would survive more than a few months. By January 1, 1997,
Hong Kong had 125 outlets, which means that there was one McDonalds’s for every 51,200
residents, compared to one for every 30,000 people in the United States. Walking into these
restaurants and looking at the layout, one could well be in Cleveland of Boston.
The only obvious differences are the clientele, the majority of whom are Cantonese-speakers,
and the menu which is in Chinese as well as English. (Watson 2015).
NEOLIBERALISM

• Is in the first instance a theory of political economic practices that purposes that human
well-being can be advance in liberating individual entrepreneurial freedoms and skills
within an institutional framework characterized by strong private property rights, free
markets, and free trade. The role of the state is to create and preserve an institutional
framework appropriate to such practices. The state has to guarantee, for example, the
quality and integrity of money. It must also set up those military, defense, police and
legal structures and functions required to secure private property rights and to
guarantee, by force, if need be, the proper functioning of markets. Is in the first instance
a theory of political economic practices that proposes that human well-being can best
be advance by State interventions in markets must be kept to a bare minimum because,
according to the theory, this cannot possibly possess enough information to second-
guess market signals (prices) and because powerful interest groups will inevitably distort
and bias state interventions (particularly in democracies) for their own benefit.
PRIVATIZATION

• Is the process of transferring an enterprise or industry from the public sector to the
private sector. Some of the government owned and controlled corporations in the
Philippines transferred already from public to private sector are Philippine Airlines (PAL),
Philippine Long-Distance Corporation (PLDT), Manila Electric Company (MERALCO) and
Manila Waterworks and Sewage System (MWSS) which are now Maynila Water Services
and Manila Water Company.
CHARACTERISTIC OF NEO-LIBERALISM

1. Government must limit subsidies

2. Make a reform to tax law in order to expand tax base
3. Reduce deficit spending
4. Limit protectionism
5. Open markets
6. Removal of fixed exchange rates
7. Back deregulation
8. Privatization

UNIT II: THE STRUCTURES OF GLOBALIZATION

LESSON I – THE GLOBAL ECONOMY
ECONOMIC GLOBALIZATION
Benczes (2014) defines economic globalization as the increasing integration of
economies around the world. Particularly the movement of goods, services, and capital across
borders. The term sometimes also refers to the movement of people and knowledge across
international borders.
INTERCONNECTED DIMENSIONS OF ECONOMIC GLOBALIZATION

1. The globalization of trade of goods and services

2. The globalization of financial and capital market.
3. The globalization of technology and communication
4. The globalization of production

• For hyper globalist a state ceased to exist as a primary economic organization unit in the
wake of global market. People are consuming highly standardized global products and
services produced by global corporations in a borderless world. Globalization transform,
the national economy into a global one where there will be no national products or
technologies, no national corporations, no national industries.
• Globalization redefine the role of the nation-state as an effective manager of the
national economy. It is therefore, misleading to assume that globalization has relegated
the nation state and its policies to an obsolete or irrelevant status government instead
are acting the midwives of globalization. Even liberals recognize the economic openness
has increased vulnerability, also admitting that states are not influenced by
globalization.
• As new actor appears on the stage of political and cultural globalization (such as the UN)
or Non-Governmental Organization (NGOs) economic globalization produces its own
new entrants as well. In all probability the major players of present-day global economy
are the transnational corporation. (TNCs). For some contemporary globalization is
equated primarily with TNCs, the main driving forces of economic globalization of the
last 100 years, accounting for roughly two-third of world export. On the other hand, for
realist TNCs still represent national interest, while others such representatives of the
dependency school are liable to identify TNCs with the means through which the rich
can exploit the poor. What is important to note is that TNCs are constantly evolving as
economic integration is becoming more intensive, production disintegrates as a result of
the outsourcing activity of multinationals.

THE ECONOMIC GLOBALIZATION PHENOMENON

• Just as there is no single definition of globalization, there is no consensus on its origin. Yet
if we accept that economic globalization is the process that creates an organic system of
the world economy, it seems reasonable to look beyond the last 30 years or so. The question
that necessarily arises is how far we should look back. Globalization processes have been
ongoing since Homo Sapiens began migrating from the African continent ultimately to populate
the rest of the world. Minimally, they been ongoing since the 16th century connections of the
American to AfroEurasia.
• The origin of globalization to the distant past the existence of the same world system in
which we live stretches back at least 5,000 years. The best-known example of archaic
globalization is the Silk Road which connected Asia, Africa, and Europe. Adopting
Fernand Braudel’s innovative concepts of long duration i.e., slow moving, almost
imperceptible framework from historical analysis, world system analysis identifies the
origins of modernity and globalization with the birth of 16th century long-distance trade.
• When Adam Smith wrote his Magnum Opus, an inquiry of nation (1776) he considered
the discovery of America by Christopher Columbus in 1492. And the discovery of direct
sea route to India by Vasco de Gama in 1498 as the two great achievements in human
history. In the course of couple of decades these two remarkable achievements were
overshadowed by breathtaking technological advances and organizations methods of
British Industrial Revolution, From the early 1800 following the Napoleonic wars. The
industrial Revolution spread on Continental Europe and North America, too.
• The economic nationalism of the 17th and 18th centuries coupled with monopolized
trade did not favor, however, international economic integration. The total number of
ships sailing to Asia from European countries rose remarkably between 1500 and 1800,
but world export to world GDP did not reach 1 to 2% in that period. If global economy
did exist in this period, then it was only in the sense of trade and exchange, rather than
production, Countries were mostly self-sufficient, the IK and Netherland being the only
exception.
• The real breakthrough came only in the 19th century. The annual average compound
growth rate of world trade saw a dramatic increase of 4.2% between 1820 and 1870,
and was still relatively high at 3.4 % 2001. By 1913, trade equaled to 16-17% of world
income, thanks to the transport revolution steamships and railroad reduced transaction
cost and holstered both external international exchanges. The relatively short period
before WWI is often referred to as the golden age of globalization characterized by
relative peace free trade and financial and economic stability.
• The structural transformation of the Western world was, therefore, both a cause and an
effect of intensified economic integration. By the second half of 19th century, the
division of labor entwined modern world economy. Consequently, sceptics of
globalization, recognize the origin of globalization to this particular era and argue that in
some respect, 19th century world economy was even more integrated than the present.
(Benczes, 2014).
THE INTERNATIONAL MONETARY SYSTEM

• Cohn (2005) that international system is the most central area in international economy,
because the most important transaction in the international economy-including trade,
investment and finance-all depend in the availability of money and credit. Thus, one
long term of global monetary issues ha stated that the most critical issue to hegemonic
stability theorist should not (be) what the hegemon does or does not in trade but what
it does or fails to do to maintain peace and what it does or fail to do to keep the
monetary system stable credit flowing in a steady fashion.

• About 29% of the world’s circulating currency is located outside the country issuing it,
during the mid-1990s at least 300$ billion. Of the top currencies (the US dollars, German
Deutsch mark, and Japanese yen) were largely from advances in communications,
technology difficult to regulate economic activities. Realist scholars by contrast, argue
that financial transaction have increased with the permission of the most powerful
states and that these states continue to dictate the terms for such transactions.

• Realist point to the fact that international monetary transaction will still rely primarily in
the existence of separate national currencies. Some assets such as special drawing rights
are international scope, and the establishment of new “euro” currency members of the
European Economic and Monetary Union (EMU) is posing major challenge to the
predominance of the nationally based, US dollar. Nevertheless, the global monetary
regime continues to function primarily in a world of separate national currencies, where
states are inevitably concerned, about current surplus. On the other hand, permits a
country to have a capital account deficit through investment abroad or the accumulation
of foreign assets.

• In addition to this current and capital accounts the balance of payments included two
less important items. The statistical discrepancy items result partly from errors in
collecting and computing data, but mainly from a government’s failure to include all the
goods, services and capital that cross its borders. The final item is in change official
reserves. in reserves. Each country has a Central Bank that holds foreign exchange and
gold reserves. When a country has a deficit in its current and capital accounts, this
amount should be matched by an equivalent in reduction When a country has a surplus
in its current and capital accounts, it accumulates the surplus in the reserves. The total
of a country’s current accounts statistical discrepancy, and change in reserves equal
zero, hence the term balance of payments.
 • Although the balance-of-payments account always balance (i.e. equals zero) in a
bookkeeping sense, this does not indicate that a country never has payments difficulties.
In the country, a country may have a balanceof-payments surplus or a balance-of-
payments deficits. These terms refer only to the current and capital accounts, and
exclude any change in an official financing. A government with a balance-of-payments
surplus reduces its liabilities to foreign governments and or adds to its official reserves,
whereas a government with a balance-of-payments deficit increases its liabilities and or
reduces its official reserve. The main body of the balance of payments therefore informs
us about a state’s overall position in terms of financial assets and liabilities.
THE FOUR MONETARY REGIMES
Cohn (2005) states that the modern period of international monetary relations
commonly refers to the existence of four monetary regimes: The classical gold standard from
the 1870s to the outbreak of WWI in 1914: a gold exchange standard during the first part of the
inter war period: the Bretton Woods system from 1944 to 1947 and “non-system” and floating
and fixed exchange rates from 1973 to the present.

THE CLASSICAL GOLD STANDARD REGIMES (1814 TO 1914)

• The Classical gold standard was a fixed rate regime in which government announce and
adhere to specific exchange rate form their currencies in relation to gold: By making the
national currency values more stable, the gold standard facilitated trade and other
transaction between economies. For example, if the U.S. dollar and British pound were
pegged at $35 and at £ 14.5 per ounces of gold, the exchange rate of dollar and the
pound would remain constant at 2.41 dollar per £1.

• Although all countries had to undergo adjustment to maintain their exchange rate, the
gold standard functioned reasonably well because, it was backed by British hegemony
and by cooperation among the major powers (especially British, France and Germany).
British assumed leadership role in stabilizing the gold standard by providing public goods
or to other countries, such as investment capital, loans, and an open market for imports,
thus Western Europe and the United States generally, maintained their official gold
parties for about 35 yrs.
• The gold standard based on orthodox liberal ideas in some important respect. The
primary objectives were to promote monetary openness and stability through the
maintenance of stable exchange rate. It was a period before John Maynard Keynes
introduced interventionist liberal ideas to combat unemployment, and countries were
expected to sacrifice domestic social objectives for the sake of monetary stability.
Orthodox liberal sometimes refer to the gold standard on highly idealized terms, and in
1981 President Ronald Reagan even created a special commission to determine whether
the US should return to the gold standard. However, critics maintain that the poorest
 countries and the poorest classes within countries often assumed the largest burden of
adjustment under the gold standard through sacrifices in welfare and employment.

THE GOLD EXCHANGE STANDARD REGIME (1914 TO 1944)

• WWI completely disrupted international monetary relations, but after the war, Britain
attempted to establish a gold exchange standard regime. A gold exchange standard, like
a gold standard, is based on fixed exchange rate among currencies. However, a country’s
international reserves under the 19th century gold standard were officially held in gold,
whereas official reserves under a gold exchange standard consist of both gold and
reserve currencies which is the British pound in the inter war period.
Although the Central Bank had in fact held reserve currencies, as well as gold in earlier
years. The gold exchange standard institutionalized this practiced. Because gold is in
scarce supply and depend on new discoveries, a gold exchange standard reserve. I more
flexibility in increasing international reserves.

• Although British efforts to maintain a gold exchange standard continued for several
years, they eventually failed. This, monetary relations for much of the interwar period
were marked by competitive devaluation, a shift to floating rather than fixed exchange
rate destabilizing speculative capital flows, and increased trade protectionism, which
culminated in the Great Depression. Some theories maintain that the failure to tr-
establish monetary stability was the growing reluctance of countries to sacrifice
domestic goals such as full employment for the sake of currency stability. Those who
argue that domestic factor was mainly responsible point to the differences in domestic
politics before and after WWI.

• Before the warm voting in most countries was limited, labor unions were weak, farmers
were not organized, and left parties were restricted. Thus, governments generally felt
too free to raise rates and taxed and decrease government expenditures to bolster the
value of their currencies, even if these policies contribute to domestic hardships such as
unemployment. By the end of the WWI, however, domestics group had gained more
influence through the extensions of suffrage, legalization of labor unions, organization of
farmers, and development of mass political parties, it was no accident that Keynes
introduced his interventionist liberal ideas with domestic economic problems. Thus,
governments could no longer easily sacrifice the welfare of their citizens to maintain the
gold exchange standard, and one government after responded to economic problem s
during the interwar period by turning away from international openness.
THE BRETTON WORLD SYSTEM REGIME
WWII was marked by a breakdown of monetary cooperation and a period of exchange
controls, and planning for post-war monetary regime culminated in 1944 Bretton Woods
conference. The Bretton Wood monetary regime was gold exchange standard in which the
value of each country ‘s currency was pegged to gold or the U.S. dollar Unlike the two previous
regimes, however, the Bretton
Wood system was based on the post-war interventionist liberal compromise. On the other
hand, the planners assumed that the pegged exchange rate would provide sufficient monetary
stability to permit a resumption of normal international trade. On the other hand, the planners
ensured that there was some flexibility and assistance so that countries could pursue domestic
objective related to employment and inflation. This marked a contrast with the classical gold
standard in which long term exchange rate stability took precedence over domestic
requirements.

According to Cohn (2005), the internationalist liberal has three major elements

1. The first element was the Post-war gold exchange standard which was in fact an
adjustable peg exchange rate rather than exchange rate system. Although countries
were to maintain the par values of their currencies in the short terms. All countries
other than the US could devalue or revalue their currencies under IMF guidance to
correct chronic balanceof-payments problems. The devaluation lowers the value;
revaluation raises the value of a currency. The Bretton Wood negotiations hoped that
the cooperative IMF framework for changing currency values would provide flexibility
that was lacking with the classical gold standard and avoid competitive such as those of
the interwar period.

2. The second element of the interventionist liberal compromise was the IMF, which would
provide short-term loans. Short term loans are provided to countries with temporary
balance-of-payments problems and thus alleviate domestic problems resulting from the
need to maintain exchange rate stability.

3. The third element of the compromise was support for national controls over capital
flows, Speculative capital flows had contributed to great instability during the interwar
period, and the post was negotiators feared that such speculations could undermine
efforts to pegged exchange rates and promote freer trade wood regime. under the
Bretton Wood regime. The chief negotiator also believed that unrestricted capital flows
would interfere with the functioning of the welfare state. If corporations and citizens
 could freely move capital abroad to evade taxes this jeopardize funding the state
required social welfare expenditure.
THE CREATION OF INTERNATIONAL MONETARY FUND
The most important international organization embedded is the Bretton Wood
Monetary regime was the International Monetary Fund (IMF), located in Washington D.C. The
IMF was created to stabilize exchange rate and provide member states with short-term loans
for temporary balance-of –payments problems. Under the IMF article of Agreements, members
were required peg their currencies to gold or to U.S. dollar, which was valued to at $34 per
ounce of gold. Member states where also to contribute to a pool of national currencies that
would be available for the IMF loans to deficit countries. Each IMF members was given a quota
on its relative economic importance, which determined the size of subscription or contribution
to IMF resource pool. Under the IMFs weighted voting system, the most economically powerful
states have the largest quotas and subscription and the most votes. At regular intervals of not
more than five years. The IMF decides whether to propose adjustment in the members quotas
in accordance with change in their relative economic positions.

THE FUNCTIONING OF THE BRETTON WOOD MONETARY REGIME

Cohn (2005), States that Bretton Wood was gold exchange regime in which the main
reserves gold and U.S. dollar. Economist generally ask three questions about the adequacy of
reserve assets in upholding a monetary regime. Are there sufficient reserve (e.g., gold and the
U.S. dollar) for liquidity, or financing purposes, as interdependence increases, more liquidity is
necessary to cover the growing number of economic transaction, but if there is a surplus of
liquidity, inflation, and other problems can result. Is there a confidence problem with the
existing reserve asset? When countries lack confidence that an asset’s value will remain
reasonably stable, they are reluctant to hold the asset in their reserve. Confidence problems
have led to periodic efforts to sell of British pound and U.S. dollars. What adjustment options
do reserve-currency countries have in dealing with their balance-of-payments deficits? An
effective regime should provide all deficit countries with a sufficient range of adjustment
options.

THE ROLE OF THE US DOLLAR

Because the Bretton Woods monetary regime was based on a gold exchange standard,
central bank could hold their international reserves in two forms, - gold and foreign exchange-
in any proportion they chose. It is ironic, however, that the original attraction of gold as reserve
asset-its scarcity- became a liability as increased trade and foreign investment led to growing
demand for international reserves. With gold mining sources limited and Western Europe
recovering from WWII, the U.S. dollar was the only currency that could meet this need with
increase liquidity. Monetary relations immediately after the war were more unstable than
expected, with balance-of-payments deficits and lack of foreign exchange seriously hindering
Europe’s recovery. Thus, Western Europe was severely lacking in the main source of liquidity is
required for making payments – US balanced-of-trade surpluses in the late 1940s contributed
to a dollar shortage. To remedy the problem, the US distributed dollars throughout the world
through economic aid and military expenditures from 1947 to 1958.

From the liberal perspective , the US provided public goods to Europeans and others
during this period opening its market to imparts, providing long term loans and grants through
the Europeans Recovery Program or Marshal Plan, and supplying the dollars s the main source
of International liquidity, to gold for their reserves and international transactions; dollars
(unlike gold) earned interest and did not have to be shipped and stored.

Although the US as global hegemon was providing its currency as a public good to meet
international liquidity needs., it was also receiving the private benefit of seignorage. Seignorage
is the profit that comes to the seignourn or sovereign power, from the issuance of money, As
the supplier of the key world currency, the US gained financial power and influence and it was
largely exempt from the discipline the international financial system imposed on other state.
The US was also able to trade and borrow in domestic currency and thus avoid exchange rate
risks and transaction costs, and the dollar leading role enabled New York City to retain its
position as the world ‘s financial capital US policy from 947 to the late 1950s was therefore
based on a mixture of altruism and self-interest, and other countries acquiesced to US
monetary leadership because of the benefits they received.

Despite the early emergence of the US as hegemon in the global monetary regime,
several changes in the late 1950s led to concerns about its continued leadership. The US
regularly had a substantial balance-of trade surplus to the post war period, nut it had even a
larger debt because of the economic and military financing, it was providing through the
Marshall Plan and other assistance program. As a result, the US had an overall balance-of-
payments deficit beginning in 1950s. US payments deficit averaged about $1.5 billion per year
for most of the decade., but they increased rapidly in the late 1950s, and observers began to
speak of a dollar glut rather than dollar shortage. In 1960s, the US payments deficit rose to $3.7
billion, and foreign dollar holdings exceeded US gold reserve for the first time. Thus, European
which have eagerly sought to obtain dollar, became reluctant to accumulate excessive dollar
reserves. A major change that raised question about US control over military relations was the
growth of the Eurocurrency market. Eurocurrencies are national currencies traded and
deposited in banks outside the home country. As the name connotes, Eurocurrencies originally
develop in Europe.
A SHIFT TOWARD MULTILATERALISM

As US balance-of-payments deficits continued to increase the dollar slipped from top currency
to negotiated currency status during the 1960s. A top currency is favored for international
monetary transaction because other has confidence in the strong economic position of the
issuing state. A negotiated currency does not benefit from this high degree confidence, do the
issuing state must offer inducement to others to continue accepting its leadership, and must be
open to more multilateral management. Thus, the G-10 established the General Arrangement
to Borrow (GAB) in 1962 under which they agreed to lend the IMF to $6 billion in their own
currencies if needed for supplementary resources to cope with international monetary
problem. The G-10 represented a shift from unilateral US management to more collective
management of monetary issues because it had to approve each request for supplementary
support.

THE GROUP OF TEN MEMBERS(F-10)

The G-10 could supply a substantial of financial resources, but there were concerns that even G-
10 resources were not sufficient to depend the dollars if it came under attack, indeed, a rush to
change the dollar into gold became more likely as the U.S. balance-of-payments deficits to
continue to increase. A series of measures were therefore adopted to bolster the dollar, and
the US sought to improve its balance of payments by reducing capital outflows. In 1965, for
example the US impose limits on foreign investment and loans by US firms and banks. Despite
these efforts, US gold stocks fell from $22.7 billion on 1950 to $10.7 billion in 1970. Thus, by
1968 the dollar in the effect had become convertible into gold.

1. Belgium
2. Canada
3. France
4. Germany
5. Japan
6. Netherlands
7. Sweden
8. United States
9. Italy
10. United Kingdom
11. Switzerland
THE FLEXIBLE EXCHANGE RATES REGIME

• The Breton Wood agreement had outlawed freely floating exchange rates, so all the
major trading nations were “living in sin” by 1973. The IMF meeting to Jamaica in
 January in 1976 finally legalized this situation by permitting each government to decide
whether to establish a par value for its currency markets, and the market alone
determine currency evaluations. In recent years IMF members have in facts relied
extensively on managed floating, in which central banks intervene to deal with
disruptive such as excessive fluctuation in exchange rates. Although managed floating,
or “manipulating exchange rates. In order to prevent effective balance-of-payments
adjustment or to gain an unfair competitive advantage.” Today the monetary regime is
mixed in nature. Major industrial countries such as the US, Japan and Canada (and a
number of LDCs)) independently float their currencies, the EU countries seek increase
regional coordination of their policies: and many LDCs peg the value of their currencies
to key currencies or basket of currencies. It is not surprising that some observers refer to
the current system of monetary relations as a “no system”.

• The move floating rates had an intellectual appeal for both some liberals and realist.
Orthodox liberals in particular argued that floating rates were preferable because of
adjustment of international exchange rates would depend on market pressures rather
than government investment. Thus, as early as 1953, Milton Friedman wrote a classic
article favoring the establishment of “a system of exchange rates freely determined in
open market, primarily by the private transaction, and the simultaneous abandonment
of direct controls over exchange transaction.” Although some liberal feared that floating
rates would lead to Instability because of speculative capital flows, as had occurred in
1930s, Friedman argued that instability during the 1930s had resulted more
fundamental economic and financial problem. Ironically, floating rates were also
appealing to some realist because of the view that government would be able to adopt
independent monetary policies.

• In a fixed exchange regime, “monetary policy must be subordinated to the requirements

of maintain the peg, effectively eliminating the discretion of authorities.” A floating
regime by contrast “allows monetary policy to be set autonomously, as deemed
appropriate in the domestic context (e.g., for stabilization purposes, and the exchange
rates because a residual, following whatever path is consistent with the stabilization
policy. By the 1970s there were additional reasons of liberal communist to favor a shift
to floating rates. With the marked increase in capital flows and speculative pressure,
governments could no longer defend fixed exchange rates and floating rates would
contribute to rapid adjustment of international payments imbalance in response to
market pressure (Cohn 2005)
GLOBAL ACTORS IN ECONOMIC GLOBALIZATION

• International Government Organization (IGO) - It refers to an entity created by treaty

involving two or more nations, to work in good faith, on issues of common interest. The
IGO strive for peace, security and deal with economic and social questions. Examples
include: The UN, the WB and on a regional level are North Atlantic Treaty Organization
(NATO) and Association of South East Asian Nation (ASEAN) where the Phils. also belong.

• International Non-Government Organization (NGOs) – The NGOs work towards solutions

that can benefit undeveloped countries that face the backlash of economic
globalization. Classifies as any non-profit, voluntary citizen’s group which is organized on
a local, national or international level. NGOs perform various services and humanitarian
functions, bring citizen concerns to governments, advocate and monitor policies and
encourage political participation through provision of information. Example of these is
Red Cross, Greenpeace and Amnesty International.

• Multinational Corporations (MNCs) – MNCs are corporation which have overseas

branches. One of the many changes they have brought to developing countries is
increase in automation. Automation means the use of various control systems for
operating equipment such as machinery with minimal or reduced human interventions.
It may damage less automated= local firms and require workers to develop new skills in
order to transition into the changing economy, leaving some behind. Corporation also
outsourced in recent years. Example of MNCs which are also present in the Philippines
are Ford Motor Corp., Fujitsu, GE, GlaxoSmithKline, and Adidas.

THE EFFECT OF ECONOMICS GLOBALIZATION ON DEVELOPING COUNTRIES

Mohr (2017), states that financial and industrial globalization is increasingly substantially
and is creating new opportunities for both industrialized and developing countries. The largest
impact has been on developing countries, who are now able to attract foreign investors and
foreign capital? This has both positive and negative effect for those countries.
Increased Standard of Living – Economic Globalization gives government of developing nations
access to foreign lending. When these funds are used in infrastructure including roads, health
care, education, and social services, the standard of living in the country increases. If the money
is used selectively, however, not all citizens will participate in the benefits.
Access to New Markets – Globalization leads to freer between countries. This is one of largest
benefits to developing nations. Home-grown industries see trade barriers fall and have access
to a much wider international market. The growth this generates allows companies to develop
new technologies and produce new products and services.
Widening Disparity in Income – while an influx of foreign companies and foreign capital creates
a reduction in overall unemployment and poverty, it can also increase the wage gap between
those who are educated and those who are not. Over the longer term, education level will rise
as the financial health of developing countries rise, but in short term, some of the poor become
poorer. Not everyone will participate in an elevation of living standard.
Decreased Employment – The influx of foreign companies into developing countries increases
employment in many sectors, especially for skilled workers. However, improvements in
technology come with the new businesses and that technology spreads to domestic companies.
Automation in the manufacturing and agricultural sectors lessens for unskilled labor and
unemployment rises in those sectors. If there is no infrastructure to help the unemployed train
for the globalized economy, social

UNIT III – A WORLD OF REGIONS

LESSON I -GLOBAL DIVIDES THE NORTH AND THE SOUTH

THE GLOBAL DIVIDES

 Filipinos are obviously coffee lovers. Branches of various international coffee shops like
Coffee Bean and Tea Leaf, Starbucks, Figaro UCC Coffee, and Seattle’s Best , are like
mushroom found in every metro areas in the Philippines. As Filipinos patronize
imported coffee brands, this oftentimes perceived as one of the effects of globalization.
Similarly, when a Filipino experience of globalization as customers. Similarly, when a
Filipino enters in one of these shops is another experience of globalization as customers
are not only Filipinos but different nationalities as well. While this show global
interconnectedness and global modernity , multi- national corporation (MNCs) and
transnational corporations (TNCs) operating in countries like in the Philippines and in
other corporation countries are likewise believed to create problems like cheap labor ,
exploitation and the like.
 This is why globalization is viewed as a process that presents two sides-good or bad, and
positive or negative. While this book, discusses Globalization as a multidimensional
phenomenon, it is imperative to look into the differing impacts of globalization to the
states and explain WHY there is growing division between rich and poor, developed and
Developing. First and Third world, and global North and global South.

 Previously , the “Third World” was used by those who criticize cold war-era politics. This
pertain to the parts of the world that did not fall into the Capitalist(also called First
World) or the communist termed as Second World During Cold War.” Third Worldism”
on the other hand, was linked to being Non-aligned of these countries but eventually
the term was abandoned as the Soviet Bloc or the “Second World” collapsed. The
countries which are less Developed in Africa, Asia and Latin America are also categorized
as “third” because Of the prevailing poverty and economic dependence to First World
states (Heywood, 2011).

• With the changing global scenarios, historical event are still relevant for these Terms.
But as Third Worldism and non alignment (due to collapsed of Soviet Bloc) are no longer
practically used, all these point only to a certain phenomenon: that there is under-
development of states/people and lack of representation in global Political process
(Claudio, 2014).

• However, as they could be different effects of world political event like imperialism and
Cold war-era, the term “global South” may still evolve, especially when affected by
globalization. In this sense, the important question may not be what the global south is
But for whom and under what condition the global South becomes relevant. (Levander
And Magnolo, 2011 cited by Claudio, 2014) Same is true when one suppose that the
global South is everywhere, but it is also somewhere, and that somewhere, located at
the Intersection of entangled political geographies of dispossession and repression
(Sparke,2007) cited by Claudio, 2014). To make sense global south can be found
between the objective realities of the global inequality and the objective response to
these (Claudio, 2014)

• For instance, when global financial crisis but most of the European countries in 2008,
Greece in particular , experienced what undeveloped countries in global South have.
Citizens were reported to have lost their job and government out public spending; issues
which are common to global South such as prostitution, heroin addiction and epidemic
arises. Thus, the problems of the global South are globalized. These terrible condition
wonder the British daily news to question “is Greece becoming a third world country”
(Moran, 2012 cited by Claudio, 2014).
 • Similarly, as US President Donald Trump issued policies that restrict immigrant as
anchored on economic nationalism, implies unemployment (even poverty) also exists in
the global North, While metro district like Makati where MNCs and large corporations
operate in a manifestation that spaces of developed countries are also found in the
global South of which the Philippines is classified . In this sense, the spaces of
underdevelopment in developed countries may mirror the qualities of the global South
and spaces of the affluence in the developing world mirror those of the global North.

THIRD WORLD VERSUS GLOBAL SOUTH

•To locate what are the states in global South, Grovogui (2011, cited by Claudio, 2014),
contends that

– The global South is not a directional designation or a point due to South from a fixed
north. It is a symbol designation meant to capture the semblance of cohesion that
emerged when former colonial entities in political projects of decolonization and moved
toward the realization of a postcolonial international order.

 Thus, Grovogui suggest that the states in the international system of governance are
those that have common experience i.e. colonization. In the early phase of Globalization
in 19th century, anti-colonial ideas reached former colonial territories which eventually
had been enlightened and developed the nation of solidarity. Such solidarities were
believed to be the foundation of contemporary concept of global south (Claudio, 2014).

 After WWII, more countries are decolonized particularly when UN was created in 1945
when over 80 ex-colonies achieved interdependence (UN, 2011). This reconstructed the
world politics which was aforementioned terms as the first(capitalist). Second
(communist) and Third (non-aligned) world engaged. The vision of non-aligned countries
and its solidarity was significantly observed when Asian and African countries in
Bandung, Indonesia, or what was eventually referred as the Bandung Conference in
1995. This assembly of 29 participants according to Buzdugan and Payne, (2016) is one
of the defiance to many form of colonialism both imperial and communist (Espiritu,
2006, cited by Claudio, 2014).

THE NORTH-SOUTH DIVIDE

 Previously interstate inequalities often pointed in the geographical area where the state
if located , But more than this criterion of categorization is the degree of economic and
political power which countries possess and are evidently observable in the interstate
 politics. The figure below identifies the characteristics of the global North as
differentiated from the global South.

• Another way of classifying states as either developed or underdeveloped is by the

concept of human development that was first used by UN in 1993. Human Development
is a standard of human well-being that takes account of people‘s ability to develop their
potential and lead fulfilled and creative lives in accordance with their needs and interest
(Heywood, 2011). UN Development report rank countries according to human
development indicators (HDI) which include life expectancy and health profile education
and literacy, fuel, sanitation, shelter: food, jobs, crime, personal distress, careers/jobs
and political participation.

• The table on the next page shows that the countries in bottom ten are located in sub-
Saharan Africa and ranked in the category of the human development. In 2010 UN
Development report in sub-Saharan African states are where life expectancy,
malnourished population, access to clean water and improved sanitation are very low or
poor.
• While geographical structures show location of states which are characterized by
poverty and Affluence, the concept of “North-South divide must have been reinforced
by certain indicators which are associated with globalization. The idea was derived from
Brandt Report, entitled North-South : A Program for Survival (1980 and Common Crisis :
North-South Cooperative for World Recovery (1983), which was conducted by
Independent Commission on International Development Issues. This was chaired by
Willy Brandt, the former Chancellor of Germany. The report suggest that instead of
concentrating on geographical split, the terms are essentially conceptual and theoretical
although it is prone to assume that in the global North’ is where industrial development
is to be concentrated while in global South (except Australia) is where poverty and
disadvantages exists. The concept points out that structural inequalities between high
investment while geographical structures show location of states which are
characterized by poverty and affluence, the concept of “North-South “ must have been
reinforced by certain indicators which are associated with globalization.

• However, such classical image of TNCs was altered at the start of the 21 st century where
TNCs from developing countries have reported to how become Increasingly important
(UNCTAD, World Investment Report 2006 and 2009). According to the report, the top
ten TNCs in 23007 were from 16 developing countries China, Hongkong, Taiwan, India,
Malaysia, Singapore, Korea, Philippines, Thailand, Brazil, Mexico, Venezuela, S. Africa,
Kuwait, Qatar, and Turkey. Furthermore, most of the developing country TNCs, though
small, are found to become major players in particular industries like the cars,
electronics, steel and container shipping.
 • Therefore, these evolving conditions, and structures in interstate politics suggest that
we must not limit the conception of global South and global North in their conventional
characterization but could be representative of an emerging form.

MAJOR LENSES OF GLOBAL RELATIONS

• In order to make sense of north-south divide idea, we have to understand the Theories,
values and assumption through which global relations have been Interpreted. How do
theories see the world? What are the major lenses on Global relations?

REALISM

• Perhaps the criticized perspective yet most dominant and influential realist can be traced
from Niccolo Michiavelli and Thomas Hobbes. Realist vision is Pessimistic, i.e. international
system is uneven, highly conflictual and marked by power struggle which based from how the
human nature is being characterized Selfishness and greed. States, as key global actors,
prioritizes self-interest and Survival. Being so, the degree of peace is believed to be relative and
temporal And can be disrupted anytime. Thus, in interpreting the concept of north-south
divide, realist postulate that the states in the global North and intersecting with the countries in
the global South in order to promote their very own interest.

LIBERALISM CONSTRUCTIVISM

• Liberals and constructivist have almost the same assumption. However, liberals are opposites
of realism because of a more optimistic vision in international system. They offer that the
principle of balance and harmony is found in all forms of social intersections. As reflected in
Immanuel Kant’s belief, universal and perpetual peace is possible because states are capable of
cooperation and value mutual respect. Liberals assume that through trade and economic
interdependence, division and war are less likely to happen . On the other hand, constructivist
also convey cooperation, trust and peace among international actors. However, these goals are
possible only if these are based on existing norms and conduct which are institutionalized.
Hence, institutions play a vital role in promoting peace in international system.

CRITICAL PERSPECTIVE MARXISM AND POST MODERNISM

• Critical approaches to global relations have been increasingly considerably since the late
1980s. These approaches are critical in the sense that they oppose in their different ways, the
dominant forces and interests in modern global relations.
MARXISM

• Regarded as the principle alternative to mainstream perspective of realism and Liberalism.

Marxism offers a distinctive approach highlighting the structure of economic power rather that
patterns of conflict and cooperation . It suggest inequalities in global system. As state in global
South engage in trading with the parts of global North, this would only results to unequal
benefits between the players because generally, the capitalist or industrialized countries in
global North tend to dominate and exploit the global South. This is true for Marxism since the
playing fields or the economic structure is inherently uneven further complicated by the impact
of globalization.

POST MODERNISM

• Post modernist debunks the ideas of hierarchy, dogmas of existing structure in global
relations. Represented by the writings of Michel Foucault, postmodernism is believed to be
based on the belief that truth is always contested and plural. Hence, emphasis was given that
all ideas and concepts are expressed in language which itself is caught in complex relations of
power. The use of language is referred as ideas of discourse power—human interactions which
can disclose or illustrate power relations (Heywood, 2011).

CONCLUSION

• As globalization prevails increase intensification of global problems are also directed. But
these are not only evident among the geographical parts of South but as well as in the North .
Hence, this validates that the ills/poverty of the Global South are continuously globalized.

• But some countries in the global South had struggle and eventually achieved affluence or
development. In this way, the global North may draw inspiration from the South experiences.
Similarly, the global South countries which were ex-colonies, may serve as models of resistance
for the world. For instance, India’s non-violence revolution headed by Mahatma Gandhi and the
Philippines’ war against Spanish colonizers and the bloodless of dictatorship in 1986 may serve
as such.

• However, among global problems, global warming continues to challenge both North-South
states. Between the two global South has been more vocal an decisive on addressing the threat
of climate change through government initiatives collective movements. This and other
prevailing global problems significantly demand for those state people from the North to
support alternatives , initiative and collective actions from the global South. A network of
solidarity is a must.
• The global South is therefore a metaphor and symbol—a term which does not only pertains to
the specific geographic ideas but also reflects a developing concept of internatiolism which is
expected to anchor from the moral potent of universal Human equality (Claudio, 201