Reflection Questions: Based on your understanding of the chart above, what is the current global business environment like? Use each of the 4 topics to support your answer, and use examples where possible. Be sure your response is structured in paragraphs (introduction, body paragraph(s), conclusion) When looking at the current global business environment, I think that the global business environment is in a very good spot and it’s heading in the right direction. When I look at the charts above there were four topics which were Globalization of Markets, Globalization of Production, Globalization of Consumers and Globalization of Technology. Each of these topics show how the global business environment is in a good stage and has room for a lot of improvement in the coming years. The first topic is globalization of markets and it is in a great spot right now because of NAFTA. NAFTA is the free trade agreement between Canada, US and Mexico. This trade agreement is the most important example of globalization of markets because you have three big national economies merging into one larger marketplace. This is happening all over the world as many national economies are merging, creating these larger marketplaces such as the Central American-Dominican Republic Free Trade Agreement (CAFTA-DR), the European Union (EU) and the Asia-Pacific Economic Cooperation (APEC). The next topic is Globalization of Product. At this time, China has become the largest manufacturing country in the world with over $2.01 trillion in output. This has both its pros and cons but if you simply look at the advantages of this, it would be that in China its cheaper to make goods than any other country. This translates into better margins and lowers prices for consumers which will increase gross profit for the companies in Canada, US, etc. Not only is it much cheaper in China to manufacture but Globilization of products will create much more job opportunities for people in developing countries especially. Thirdly, there is Globalization of Consumers. This topic was hit hard during the COVID-19 pandemic because it was very tough for people to ship the products coming from the global market. This is a great example for improvement because its been a bit of time since COVID and franchises and different markets are back up on the rise and the want for products globally is starting to get back to pre-COVID numbers. I think that if you look at the business environment from that point of view, it is a working progress to get the numbers back up but consumers are getting back into the global market and products are getting sold daily from amazon, apple, etc. The last topic is globalization of technology which is an extremely important section of globalization. I think out of all of them, it could be the one that is improving at the fastest rate. If you look at technology 20, even 10 years ago, there were major differences in the world. Technology has been improving so rapidly as much of the world is turning to digital. As of 2018, 7.6 billion people have mobile phones and there are many things becoming digital like paying for things, using a GPS or uber. These technologies make the planet we inhabit unrecognisable from even 20 years ago. This change is only going to be faster as the increase in technology has enabled scientists and engineers around the world to engage in global competition. We are living in the digital era - a time of rapid technological change led by digital technologies. These new technologies are reshaping economies—and societies. To conclude, the four topics discussed show that the current global business environment is in a good spot as the worlds trade, products, markets and innovations continue to increase and with COVID finally behind, numbers are returning back to normal and even better in many aspects of trade. Based on what you know about the current global business environment, do you think globalization and international trade are beneficial or detrimental to countries and its people? Evaluate each side (give 3 reasons for each side), but choose one position in the end. Globalization and international trade are detrimental to countries and its people - Increased Competition If you view global trade as a whole, you see that it benifits companies, workers and economies. However, if you look at domestic companies and products they are affected because there is more foreign competition. The pool has simply widened. Although some countries may impose tariffs, or quotas on foreign products. Over-time it would simply affect economic performance as a whole. - Economic Dependence International Trade allows more developed countries to take advantage of developing countries. The reason why is because underdeveloped countries have to depend upon the developed ones for their economic development. An example of this would be undeveloped countries in Africa and Asia getting exploited by rich European countries for their resources, etc. - Political Risk There are always domestic political changes and this prevents an ongoing challenge. Governments can easily change laws or create regulations that directly impact certain trades with other countries. That is why it is important to trade with varying countries rather than solely trading with one which helps balance the political risk. Globalization and international trade are beneficial to countries and its people - Increase Economic Growth Can be organized into three main points Access to labor - It gives countries a wider labor pool which means that developing countries with a shortage of workers can “import” labor to kickstart industry. Whereas, developed nations can outsource low skill work to developing countries. Access to jobs - Developing nations often gain access to jobs by wealthier countries who are outsourcing them. Access to resources - Countries can gain access to resources they previously wouldn’t have had. The ability for nations to “specialize” - Cooperation between nations allows certain countries to heavily lean on their economic strengths and trade with that. - Increased Global Cooperation For globilzation to exist and be successful, nations have to work together and put any differences in culture/languages aside. This doesn’t eliminate conflict but it heavily reduces it. - Increased International Investment International investment between different companies really expands the range and possibilities for both investors and companies which in turn enhances welfare on both sides of the equation. The nation that provided the capital gains because it frequently earns a higher return abroad than it does at home. The nation that gets the capital inflow gains because that capital spurs investment, which raises productivity. Based on my evaluation of these two sides of the argument, I believe that globalization is beneficial to countries and its people because it increases international investment, it increases economic growth through resources, jobs, labour, etc. It also increases global coorperation between countries. Globalization and international trade not only give access to labor and more jobs in developing countries, they give consumers a wide range of resources/products at a lower price that they previously wouldn't have been able to have. It allows countries to specialize and heavily rely on their economic strengths and trade with resources that are in demand from many countries around the world. Globalization also increases international investment which is so important because it benefits both sides of the equation. People can spread their investment risk among foreign companies and markets and these investments take the potential for growth in many emerging economies. They increase welfare on both the investor and the companies side and it increases productivity as a whole. Finally, globalization increases cooperation between countries which is so important because if the world is going to continue to advance in all aspects, there has to be respect and relationships between countries. Having tension between countries leads to war and other unwanted outcomes. Globalization makes nations work together and putting away all differences in language/culture. To conclude, globalization is beneficial to all countries and although I only mentioned three points, there are so many reasons why globalization is the future for the world and hows its the key behind the development of economies, innovations, international trade and relationships.
