Globalisation and its Impacts: Region

Introduction
Understanding Globalisation
Defining region and impact of globalisation on region
Rise of Regionalisation
Conclusion

Introduction

Globalization is a process that has sped up the exchange of ideas, information, goods, and services among different nations. Even though the exchange of concepts, knowledge, products, and services all point to economic exchange, a closer examination reveals that social and cultural aspects have also been impacted. Not only are the things that are traded between nations questioned, but also the parties with whom these trades are made. Some thinkers contend that the term "globalization" should not be used to describe the rapid exchange of goods that is taking place in the world because only western nations export goods they produce and attempt to dominate the global market. The proper term is "westernization.". And this control is not just economic; it also pertains to the cultural influence that these nations have over other nations. One of the significant effects of globalization on regions can be seen in this process. The idea of a region is a grouping of geographical, economic, cultural, or social characteristics.

It's interesting to note that the idea of regionalization has also grown as a result of globalization. Although the two appear to be at odds with one another, there are forces at play in globalization that are fostering the conditions for the formation of regions. This module aims to investigate how globalization has affected local communities. The module is divided into four sections to better understand this impact. The first section seeks to comprehend the idea of globalization, the second section seeks to define the idea of region and discusses the effects of globalization on region or the relationship between globalization and region, and the third section highlights the phenomenon known as regionalization.

Understanding Globalisation

Most people understand globalization as an economic process that results in a significant flow of goods and services from one country to another. The concept of "globalization" is not particularly new; it first emerged at the beginning of the 20th century as a result of open trade between numerous nations. The late nineteenth and early twentieth centuries are when the first wave of globalization began. Trade between nations expanded quickly in the late 1800s and early 1900s, and significant investment was made internationally. International trade in goods and services was as free as it is today between 1870 and 1914, according to Butier (2001). Additionally well-developed and with few official limitations were international lending and borrowing (p. 2). But now, some have brought up how some of the 1920s and 1930s economic catastrophes were caused by the policies that were adopted during this time. The second wave of globalization began in the 1950s and 1960s, when many developed nations abandoned their regulatory frameworks in favor of free trade with other nations. However, the 1970s saw a decline in this investment boom as stagnation and inflation swept through Europe and the United States in the second half of the decade (Omang, 1999). With the adoption of deregulation policies by developing countries, the next phase of globalization began. India in 1991, China since 1979, Indonesia, and the majority of Latin America since the middle of the 1980s are just a few examples of developing nations that liberalized their economies to entice foreign investment. This period saw an increase in globalization that was also aided by the development of various information and communication technologies.

But as globalization gained momentum, it became clear that it affects more than just the economy and has effects in a variety of areas. As an illustration of the significance of blending national and regional borders, Oman (1999) states that "Globalization can be defined as the growth, or more specifically the accelerated growth, of economic activity that spans politically defined national and regional boundaries. While Butier (2001), in a similar vein, states that "Globalization is the steady decline in importance of national boundaries and geographical distance as constraints on mobility ,". However, once more, it is not just various definitions of globalization that are being listed; various schools of thought have also emerged, each viewing globalization in a different way. It is common to discuss three different globalization interpretations. Globalization, according to first wave theorists, is primarily an economic phenomenon with some cultural ramifications (Hopper, 2007). Thus, they contend that globalization has an impact on a nation's culture in addition to its economic activity. According to second wave thinkers, globalization should be viewed as the expansionist plans of the world's already developed nations (Hopper, 2007). They assert that only a small number of nations, such as Europe, Japan, and North America, have significant technological and financial resources, and as a result, they primarily serve their own interests while showing little concern for those of other nations. Making money is their only priority. Globalization is still a process, according to the third wave of theorists, and we should wait before properly defining it. They assert that it is undoubtedly a multifaceted activity that affects a great deal more than just economic activity. A few of these activities include the creation of industries, scientific and technological advancement, and occasionally even critical thinking.

Defining region and impact of globalisation on region

A region is an area that is typically designated as being distinct from other areas based on any local characteristics. In general, physical and cultural conditions can be used to classify regions. The classification of physical conditions includes topography, relief, climate, soils, natural vegetation, minerals, etc. As opposed to the fact that cultural factors typically include religion, language, population, agriculture, and industries (Mondal, n. d). Generally speaking, regions are interdependent units that serve as crucial components of dynamic, interacting networks. Culturally distinct regions give their inhabitants a sense of place, as well as social and cultural roots (Suaud, 2001). Geographical boundaries are the most popular method of dividing regions because they naturally divide one particular group of nations or areas. The effects of globalization have been seen in all areas of the world because it is a process that touches every part of it. According to Suaud (2001), globalization is an inevitable phenomenon that has a direct impact on regions. The economic effects of globalization appeared to have had the greatest impact on the regions, despite the fact that globalization affects everything. Prior to globalization, trade agreements were typically negotiated between two or three nations. However, as a result of increased competition in the economy, countries are now attempting to negotiate trade agreements on a global scale or with numerous nations at once. Since globalization has given wealthy nations the opportunity to export their goods and services to other nations, they appear to have benefited from it and gained access to new markets. The poor and developing regions, however, are having difficulties. Suaud (2001), for instance, claims that globalization is impacting Europe's regions differently. According to the author, because of issues like a lack of domestic and foreign investment, emigration, brain drain, geographic isolation, and other issues, globalization makes some regions more susceptible to external disasters and economic restructuring.

Rise of Regionalisation

Regional integration or regionalization has benefited from the globalization phenomenon. Because of the favorable trading conditions, it has resulted in the creation of many different regions. Due to economic interactions between some nations, a specific region has emerged that favors trade and investment only between those nations. As a result of globalization, nations are now able to identify and integrate with other nations that share their interests. The terms "globalization" and "regionalization" appear to be at odds with one another because globalization seeks to unite the entire world while regionalization refers to the formation of groups of particular countries. However, the intense competition that globalization has unleashed has led countries to seek out safe havens and engage in trade with them. The nations in a region begin to rely on one another and form close relationships. According to Rzepka (2014), "Regionalization is a long-term process of integrating the economies of specific countries and the region by intensifying and deepening their economic relations (as well as social, cultural, and political), which results in the formation of a highly interdependent, regional system" (p. 191). The author goes on to say that globalization and regionalization are similar in that both processes seek to create favorable conditions for trade and investment. Similar social and political support is another goal of regionalization.

According to Rzepka (2014), regionalization can occur on two different levels: first, within a specific region (continent, for example), and second, between regions by establishing international ties by signing various treaties or agreements. Regionalization is one of the effects of globalization, but it can also be seen as a step in that direction. It indicates that a small number of nations initially band together to engage in free trade while preparing for larger markets. These nations negotiate the establishment of industries in each other's countries while occasionally removing trade barriers to facilitate free trade.

The signing of numerous treaties and agreements enables the second level of regionalization. Rzepka (2014) further identifies three phases of regionalization based on the signing of numerous trade agreements and other economic developments. The first stage of regionalization, according to the author, began in the 1930s, a time of global economic depression. In this phase, the majority of the nations withdrew from the international pacts they had signed during the first wave of globalization because they expected to lose out due to a global economic downturn. The second phase of regionalization occurred during the 1950s and 1960s, when the developed economies of the world once more signed trade agreements to encourage investment and trade between these nations. With the liberalization of developing nations in the 1990s, regionalization entered its third phase. By lowering trading standards, developing nations opened their economies to the rest of the world.

As these are "trade-creating," some economists view regionalization as advantageous. e. Countries in a region remove barriers to trade and investment so that they can proceed smoothly and effectively (Butier, 2001; Oman, 1999). Though some economists view this as harmful because these regions are "trade-diverting," i. e. , the nations in a region completely bar other nations from engaging in trade.

Although it is praised when trade between nations in a region runs smoothly, the exclusion of some nations, particularly developing nations, has caused concern. According to Oman (1999), "Some economists have also highlighted the risk of degenerate regionalism, i. e. , a rise in regionalization that, like in the interwar years, causes the world trading system to break up into a number of hostile and relatively closed regional blocs . These developing nations face the risk of being left out of blocs formed by developed nations because they have recently liberalized their economies and have fewer resources. For the purpose of promoting free trade, numerous trade agreements have been signed between nations. After World War II, the United States established the General Agreement on Tariffs and Trade (GATT), which went on to become one of the most significant multilateral trade agreements (Irwin, 2008). With only a few countries as members in 1995, the GATT evolved into the World Trade Organization (WTO), which now has more than 140 members. The GATT, the GATS, the agreements on trade-related intellectual property rights, and the agreements on trade-related investment are all governed by the WTO (Irwin, 2008). The WTO has evolved into a body where member nations can begin trading while establishing the terms that work best for them.

The Organisation for European Economic Cooperation (OEEC) was established in 1948 as a result of the idea that European nations should band together to maintain peace, promote cooperation, and aid in reconstruction. The organization's goal was to recognize each nation's advantages and use them to work cooperatively. Later on though, the US and Canada joined this group of European nations. In 1961, the organization expanded and became the Organisation for Economic Co-operation and Development (OECD). There are currently 34 members of the OECD. The European Economic Council, established in 1958, is another significant organization that facilitates trade between some nations. Twenty-seven European countries make up this organization, which is now known as the European Union. The European Union's member nations have advanced toward economic integration by removing numerous trade restrictions. In order to promote trade and investment activities, the European Union as a whole has adopted the Euro as its single currency.

Signing a trade agreement through the WTO is advantageous for some nations, but not all. Unrelated to the WTO, some of the nations have signed agreements. One such agreement is the North American Free Trade Agreement (NAFTA), which was signed by the United States of America, Canada, and Mexico. Its goal was to lower trade barriers between these nations. The agreement was made in January 1994. Even though signing these agreements is good for trade, sometimes these agreements create different trade regions that become exclusive in themselves, cutting off from other nations. Developing nations in particular continue to be lost in this process. According to Irwin (2008), opponents of regionalization are concerned that these strategies could undermine and replace the multilateral WTO approach, which is the preferred method for conducting business on a non-discriminatory basis on a global scale. Therefore, the long-term effect of bilateralism could be a decline in the global trading system into rival, discriminatory regional trading blocs, resulting in added complexity that makes the easy flow of goods between countries more difficult. Additionally, the regional or bilateral levels are ineffective for addressing issues like reforming agricultural export subsidies. " .

The fear of globalization and regionalization, however, is not limited to developing nations in Asia and other regions. Due to the rapid growth of these two young emerging economies, even the developed nations are concerned about developments occurring in developing nations like Japan and India. The trade tariffs of these developing nations have been significantly lowered; for instance, India has lowered its trade tariffs from three to two digits (The impact..., 2008). Even the developing Asian nations have established their associations. For instance, the Association of Southeast Asian Nations (ASEAN) was founded in 1967 by Indonesia, Malaysia, the Philippines, Singapore, and Thailand. As Myanmar, Cambodia, Lao PDR, Vietnam, and Brunei Darussalam gradually joined ASEAN, there are now a total of 10 members. According to the ASEAN declaration, the association aims to strengthen the groundwork for a prosperous and peaceful community of Southeast Asian Nations by accelerating regional economic growth, social progress, and cultural development through collaborative efforts in the spirit of equality and partnership. Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan, and Sri Lanka came together to form the South Asian Association for Regional Cooperation (SAARC) in 1985. This also aimed to encourage political and economic harmony among Southeast Asian nations.

The Asia-Pacific Economic Cooperation (APEC) was also established as a new organization. It was a regional economic forum that was started in 1989 with the goal of fostering balanced, inclusive, sustainable, innovative, and secure growth as well as quickening regional economic integration. According to APEC, the region's GDP doubled between 1989 and 2013 and its citizens' per capita income increased by 45%. Consequently, there are numerous trade agreements in force. There are currently 230 regional integration agreements, according to Rzepka (2014). But these agreements' signing has brought up some queries and worries.

According to Oman (1999), regionalization as a result of globalization has raised two questions that are closely related: 1) Do the major regional integration agreements, such as the North American Free Trade Agreement (NAFTA) and Europe's Single Market programme, tend to balance between trade-creating or trade-diverting? 2) Do these regional agreements tend to work for or against a more open world trading system that globalization is intended to create? This inconclusiveness can be attributed to the quick changes occurring in this era of globalization and the requirement for thorough research studies.

The development of regionalization is changing as globalization accelerates in the modern era. According to Rzepka (2014), a new regionalization has emerged with goals for political, social, and cultural cooperation in addition to economic cooperation. In defining this idea of new regionalization, he writes, "new regionalization is a concept and strategy - prepared and implemented by the countries of the region - using mechanisms of broad cooperation in economic, political, social, and cultural spheres to strengthen the competitiveness of the region and to increase the benefits and to reduce the risks associated with globalization" (p. 193). ”.

Conclusion

It is true that globalization is giving nations new opportunities for trade and investment while also encouraging nations to tap into their full potential in various sectors. Raising people's standards of living is another way that globalization helps. But it turns out that these effects are not the same for all nations; rather, globalization has a different impact in different regions of the world. The growth of various regions has been facilitated by the globalization of the economy. To put it another way, regionalization is a result of globalization. Again, regionalization is viewed as both beneficial and detrimental. It is proving to be beneficial because it is fostering trade and investment among some nations in the region, but it is also detrimental because these nations occasionally close their borders to other nations.

But by enacting a few rules and regulations, these two sides of good and bad can be balanced. Economic shifts and the growth of regional competition, according to Rzepka (2014), "may be viewed as an important step of adjustments and of preparation of the economies of countries and regions to an increasing competition in the global market" (p. 193). The importance of the EU enlargement process being inclusive and outward-looking rather than exclusive and inward-looking is also stressed by Butier (2001). Care must be taken to ensure that the expanded EU is "trade creating" for the entire world rather than "trade diverting" at the expense of the nations left outside the expanded Union in the area of trade, (p-13). In order to build a global economic system, Suaud (2001) asserts that "policies aimed at balancing out the negative effects of regional territorial competition must be supplemented by the free-market doctrine. " .

The preservation of local cultures is another issue that requires attention because they are one of the most significant casualties of globalization. In order to avoid a greater loss and the reduction of the rich diversity already present in the world, it is crucial to preserve the local identity and social and cultural ethos of a specific region.

References

Butier, W. (2001). Globalisation and regional integration; a view from Eastern Europe and the FSU. Retrieved from http://willembuiter.com/global.pdf
Omang, C. (1999). Globalisation, Regionalisation, and Inequality. In Inequality, Globalisation, and World Politics. Eds. Andrew Hurrell & Ngaire Woods. Oxford: Oxford University Press.
The Concept of Region. Retrieved from https://www.e-education.psu.edu/geog571/node/392
Mondal, P. (n.d.) Regional Concept of Geography: Attributes, Classification of Regional and Regionalism. Retrieved from http://www.yourarticlelibrary.com/geography/regional-concept-ofgeography-attributes-classification-of-regional-and-regionalism/24593/
Irwin, D. (2008). The Concise Encyclopedia of Economics: International Trade Agreements. Retrieved from http://www.econlib.org/library/Enc/InternationalTradeAgreements.html
The impact of globalisation and increased trade liberalisation on European regions. (2008). Retrieved from http://ec.europa.eu/regional_policy/sources/docgener/studies/pdf/impact_liberalisation.pdf