THE GLOBALIZATION CONTROVERSY

On the eve of the new millennium, groups representing organized labor, human rights, and environmental interests confronted the WTO in what has come to be known as the Battle of Seattle. The WTO had convened in the American city for a new round of negotiations to reduce trade barriers. Thirty thousand protesters from around the world, angered by what they believed was a failure of the WTO to properly address their concerns relating to poverty, labor conditions, and the environment, blocked traffic and in a few cases engaged in vandalism and violence. The police responded with tear gas and rubber bullets. The next meeting of the WTO was subsequently scheduled in the Arab Gulf state of Qatar, described by a U.S. State Department report as a country that “severely limits freedom of assembly and prohibits workers from organizing unions.”40

Clearly a final challenge facing the WTO is how to handle an increasingly global and organized opposition to its agenda. Some parties believe that the globalization fostered by the WTO favors developed countries seeking to sell to developing countries and not vice versa. For example, the United States, Japan, and Europe maintain some of their highest tariffs on agricultural products, which account for a large portion of exports from the developing world. Agricultural subsidies in the developed world further undermine the ability of developing countries to compete in the global marketplace. Developing countries also claim that food safety standards imposed by developed countries are often discriminatory. Thailand sued Australia for requiring chicken parts to be precooked at such a high temperature that it renders the product inedible.

Other opposition to globalization comes from traditional labor unions in industrialized countries as well as new groups opposed to the outsourcing of professional jobs. Both conservatives and liberals in developed and developing countries are concerned that the WTO usurps sovereignty from governments. For example, the state of Utah outlawed gambling for 110 years, and this prohibition was later extended to Internet gambling. However, the WTO ruled that the Utah law discriminated against foreign providers of “recreational services.” Such rulings fuel the fears of those who believe that the WTO is an attempt to impose a one-world government.

Is globalization bad or good? As we saw with the case of global outsourcing, this depends on who you are. The distribution of income in the United States reflects increased inequality over the past 25 years. Geoffrey Garret argues that this pattern can also be observed at a national level. Twenty years of increased globalization appears to have been more advantageous to industrialized countries and the world’s poorest countries. However, countries that comprise the economic middle—many of which are located in Asia and South America—have not fared as well. Real per-capita income grew by less than 20 percent in these countries in the last two decades of the 20th century. This was less than half the growth rate in upper-income countries and less than one-eighth the growth in the low-income countries.

Translating Values from Proverbs

Proverbs can be an important indicator of cultural values as they often reflect the underlying attitudes and beliefs translated into the culture’s members, such as attitudes towards business ventures and business relationships. Making sincere attempts to understand and appreciate our own as well as other cultures’ proverbs can help us improve in our cultural interaction. Consider the following:

  • The bigger the hat, the smaller the property. (Australian)
  • Turn your face to the sun and the shadows fall behind you. (New Zealand – Maori)
  • Venture all; see what fate brings. (Vietnamese)
  • Where there are no tigers, a wildcat is very self-important. (Korean)
  • Call on God, but row away from the rocks. (Indian)
  • Don’t worry yourself about the fever before it arrives. (Thai)
  • Loyalty is more valuable than diamonds. (Filipino)
  • A crisis is an opportunity riding the dangerous wind. (Chinese)
  • If you enter a goat stable, bleat. if you enter a water buffalo stable, bellow. (Indonesian)
  • After victory, tighten your helmet cord. (Japanese)

Do you know more proverbs that reflect cultural values in business? Share them with us in the comment section below.

WTO Report reveals high trade growth of least-developed countries (LDC)

 

On October 10, 2012, members of the Sub-Committee of Least-Developed Countries (LDC) discussed the high trade growth noted in a WTO Secretariat Report. In the report, the value of LDCs’ total exports grew by 23.9 per cent in 2011, reaching to US$229.8 billion. However, LDCs also raised concerns in the current economic situations such as volatility of prices on fuels as well as hunger and poverty issues in the meeting.

The secretariat report finds that most product categories that contributed to the 2011 trade expansion are fuels, mining products, and agricultural products. Almost all of these products have witnessed price hikes in the recent years. It is possible that price changes contribute to the overall trade growth. Nonetheless, share of world trade in LDC increased from 1.09 per cent in 2010 to 1.12 per cent in 2011.

In the meeting, many developing countries as well as LDCs suggest “more work to be done” such as better market access, aid for trade and funding.  In addition to China’s and Australian’s trade aids such as duty-free imports for LDCs, the European Union and other developed regions also urge more aid for trade for LDCs.

For more information: http://www.wto.org/english/news_e/news12_e/devel_10oct12_e.htm

For the Secretariat Report:  “Market Access for Products and Services of Export Interest to Least-Developed countries” 

Trans-Pacific Partnership (TTP) Negotiation

The 14th Trans-Pacific Partnership has taken place in Leesburg, Virginia, on September 6th – 15th. Leaders of Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, the United States, and Vietnam have gathered there to deepen comprehensive market access, regional agreement, cross-cutting trade issues, and new trade issues.

Trans-Pacific Partnership (TTP) has been engaged in high-standard economic integration process with comprehensive duty-free access to members’ markets and new trade and investment rules.  Currently with nine team members, the Partnership has drawn strong attention and interests from other countries in Asia and Pacific region, in particular, Mexico and Canada.  The Partnership Negotiation has also actively attempted to address new issues in the trade arena, such as information technology, green growth and new technologies. TTP derived from Trans-Pacific Strategic Economic Partnership Agreement in 2007 with four members originally.

For more information.

Trouble With Australia?

Source: WTO

On 4 April 2012, Honduras requested consultations with Australia under the dispute settlement system concerning the latter’s certain measures concerning trademark and other plain packaging requirements applicable to tobacco products and packaging.

Honduras challenges the following measures:
•    An Act to discourage the use of tobacco products, and for related purposes, Australia’s Tobacco Plain Packaging Act 2011, and its implementing regulations;
•    the Trade Marks Amendment (Tobacco Plain Packaging) Act 2011; and
•    any amendments, extensions, related instruments or practices.

To read more about this dispute, click here.