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    The Global Economy

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    Mariel Alcazar
    The document discusses global economic issues related to poverty and economic globalization. It describes the UN's Millennium Development Goals from the 1990s to reduce extreme poverty by half by 2015, which was largely achieved as the number of people living on less than $1.25 per day declined from 1.9 billion to 836 million. However, climate change poses a threat to continued reductions in poverty. While economic globalization and free trade have contributed greatly to reduced poverty by connecting economies and driving growth, there are also inequities that fair trade aims to address through more just pricing and sustainable, environmentally-sound practices.

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    The Global Economy

    Uploaded by

    Mariel Alcazar
    24 views32 pages
    The document discusses global economic issues related to poverty and economic globalization. It describes the UN's Millennium Development Goals from the 1990s to reduce extreme poverty by half by 2015, which was largely achieved as the number of people living on less than $1.25 per day declined from 1.9 billion to 836 million. However, climate change poses a threat to continued reductions in poverty. While economic globalization and free trade have contributed greatly to reduced poverty by connecting economies and driving growth, there are also inequities that fair trade aims to address through more just pricing and sustainable, environmentally-sound practices.

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    The document discusses global economic issues related to poverty and economic globalization. It describes the UN's Millennium Development Goals from the 1990s to reduce extreme poverty by half by 2015, which was largely achieved as the number of people living on less than $1.25 per day declined from 1.9 billion to 836 million. However, climate change poses a threat to continued reductions in poverty. While economic globalization and free trade have contributed greatly to reduced poverty by connecting economies and driving growth, there are also inequities that fair trade aims to address through more just pricing and sustainable, environmentally-sound practices.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    24 views32 pages

    The Global Economy

    Uploaded by

    Mariel Alcazar
    The document discusses global economic issues related to poverty and economic globalization. It describes the UN's Millennium Development Goals from the 1990s to reduce extreme poverty by half by 2015, which was largely achieved as the number of people living on less than $1.25 per day declined from 1.9 billion to 836 million. However, climate change poses a threat to continued reductions in poverty. While economic globalization and free trade have contributed greatly to reduced poverty by connecting economies and driving growth, there are also inequities that fair trade aims to address through more just pricing and sustainable, environmentally-sound practices.

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    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 32

    Chapter 2:

    THE GLOBAL ECONOMY


    INTRODUCTION
    The United Nations (UN) tried to
    address the different problems in the
    world. Their efforts were guided by
    the eight Millennium Development
    Goals, which they created in the
    1990s. Among these eight goals, the
    eradication of extreme poverty and
    The other seven goals include: achieving
    universal primary education, promoting
    gender equality and women empowerment,
    reducing child mortality, improving maternal
    health, combating diseases like HIV/AIDS
    and malaria, ensuring environmental
    sustainability, and having a global
    partnership for development (United
    Nations, 2015) The UN tried to achieve
    them by the year 2015.
    Since there are different standards of
    living around the world, we can
    expect different meanings attached
    to it. In the Philippines, a person is
    officially living in poverty if he makes
    less than 100,534 pesos a year,
    around 275 pesos a day.
    This is called the poverty line or poverty
    threshold. But we are going to focus on
    extreme poverty which, according to the
    UN (2015), is a condition characterized by
    severe deprivation of basic human needs
    including food, safe drinking water,
    sanitation facilities, health, shelter,
    education, and information.
    The UN defines extreme or absolute
    poverty as living on less than $1.25 a
    day. The organization aims to
    eliminate extreme poverty for all
    people by 2030.
    It was three years ago and the results
    were in. The UN (2015) reported that
    836 million people still live in
    extreme poverty but that is down
    from 1.9 billion, so there is success or
    at least a lot of progress.
    The World Bank predicted that by 2030 the
    number of people living in extreme poverty
    could drop to less than 400 million. Of
    course that assumes everything will keep
    improving as it has been. However, climate
    change has to be considered since it is a
    threat to these improvements in global
    poverty.
    Most people who have been lifted out of
    extreme poverty are still poor and being
    poor comes with serious problems, from
    disease to lack of water. Income inequality
    is rampant and one in seven people still
    live without electricity. So why is extreme
    poverty falling? The answer to this is really
    complicated.
    A set offactors like better access to
    education, humanitarian aid, and the
    policies of international organizations like
    the UN have made a difference. However,
    the greatest contributor is economic
    globalization. The world's economies have
    become more interconnected and free trade
    has driven the growth of many developing
    economies.
    Economic Globalization
    and Global Trade
    According to the United Nations (as cited
    in Shangquan, 2000), "Economic
    globalization refers to the increasing
    interdependence of world economies as a
    result of the growing scale of cross-border
    trade of commodities and services, flow of
    international capital, and wide and rapid
    spread of technologies.
    It reflects the continuing expansion
    and mutual integration of market
    frontiers, and is an irreversible trend
    for the economic development in the
    whole world at the turn of the
    millennium." (p. 1)
    There are two different types of
    economies associated with economic
    globalization protectionism and trade
    liberalization: Protectionism means "a
    policy of systematic government
    intervention in foreign trade with the
    objective of encouraging domestic
    production.
    This encouragement involves giving
    preferential treatment to domestic
    producers and discriminating against
    foreign competitors" (McAleese, 2007
    as cited in Ritzer, 2015, p. 1169).
    Trade protectionism usually comes in
    the form of quotas and tariffs.
    Tariffs are required fees on
    imports or exports. For
    instance, a pen that costs
    $1.00 in Country A and in
    Country B, it would be given
    five-dollar tariff.
    The pen would become $6 in
    Country B. This policy was
    practiced during the mercantilist
    era, from sixteenth to seventeenth
    centuries until the early years of
    the Industrial Revolution (Chorev,
    2007).
    The Great Depression of 1929 marked
    the peak of protectionism. Until today,
    protectionism exists in the world
    economy despite the growth of trade
    liberalization. Countries such as China,
    Japan, and the United States are being
    accused of practicing protectionism
    (Ritzer, 2015).
    World War II heavily influenced
    the shifting of the dominant
    economic policy from
    protectionism to trade
    liberalization or free trade.
    Free trade agreements and technological
    advances in transportation and
    communication mean goods and services
    move around the world more easily than
    ever. We are talking about everything
    from shoes and bananas to innovations
    and ideas.
    Let us take mobile phones as
    an example. Mobile phones
    seem to have good
    consequences for everything
    including reducing poverty.
    According to economist Jeffrey Sachs,
    mobile phones are the "single most
    transformative technology" when it
    comes to the developing world. Phones
    give people access to banking and
    payment systems and better access to
    education and information.
    In some places, mobile phones
    help farmers get information and
    get the best price for the crops
    they are producing. Installing
    cellphone towers is also a lot
    cheaper than running thousands of
    kilometers of telephone lines.
    Economists call this leapfrogging the
    idea that countries can skip straight to
    more efficient and cost-effective
    technologies that were not available in
    the past. International trade has also
    created new opportunities for people
    to sell their products and labor in a
    global marketplace.
    Globalization made some countries,
    especially the developing ones, to gain
    more in the global economy at the
    expense of other nations. There are
    various ways, however, the country can
    make trade easier with other countries
    while lessening the inequities in the
    global world.
    One of them is "fair trade" (Nicholls and
    Opal, 2005). Fair trade, as defined by
    the International Fair Trade Association,
    is the "concern for the social, economic,
    and environmental well being of
    marginalized small producers" (Downie,
    2007, pp. C1-C5).
    It aims for a more moral and equitable global
    economic system. Specifically, it is concerned
    with protection of workers and producers,
    establishment of more just prices, engagement
    in environmentally sound practices and
    sustainable production, creation of
    relationships between producers in the South
    and consumers in the North, and promotion of
    safe working environment.
    Products like coffee,
    bananas, cotton, wine, tea,
    and chocolate have been
    exchanged in light of fair
    trade.
    A concrete example of the growth of fair
    trade is the case of American coffee
    chains such as Starbucks and Dunkin'
    Donuts. In 2006, there are $2.2 billion
    dollars spent on certified products,
    which is 42% greater than the preceding
    year (Ritzer, 2015).
    In turn, coffee growers such as
    those in Brazil "get at least $1.29
    per pound of coffee beans
    compared to the current market
    price of $1.25" (p. 296).
    Presenters:
    Mariel Alcazar
    Bea Del Rosario
    Jamaica Gabarda
    Arnellie Mar Balanac
    Judelyn Cosepe
    Ricca Magpayo
    Aic Alberga Llanita
    Dendaryl Naño

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