Social Impact of Business - Essay Example

Translational corporations such as WTO and IMF try to establish international operations by locating industrialized plants or operations in different countries to help in cutting costs; it may also be possible to subcontract work. Globalization helps create international supply chains (IMF, 2001). It helps buy components, raw materials, or additional supplies from traders in different countries. Big Transnational Corporations identified by the UN as firms that manage resources abroad. There are around 79 thousand Transnational Corporations functions in the modern world economy.

This allows them ten times the amount of affiliates such as subcontractors, suppliers, and various entities that have business connections with them. It is a fact that a few influential firms carry out most of international commerce. The first firm at the top of the list is the World Bank. Developed in 144, the World Bank offers loans of economic expansion to its member nations. They provide funds for use on power plants, roads, pipelines, dams and other communications projects. The World Bank also negotiates strategies of structural adjustment with countries it provides loans.

It also gives the countries conditions, which some claim result to unfair load on developing countries (Aslam, 2001). Another firm is the International Monetary Fund (IMF), which is a sister firm to the World Bank established at a similar time. The purpose of IMF is to ease currency exchange for countries that are members so that they have the capability to be part of global trading. It provides access to member countries for foreign exchange. World Trade Organization WTO, established in 1995, is a global body that creates ground rules for international trade (IMF, 2001).

Its main goal is to encourage free trade by eliminating any potential barriers to it such as duties, quotas and tariffs. The organization performs negotiations rounds on different topics. Social Impact of Business During the end of the 1990s, the International Monetary Fund (IMF), World Bank, and the World Trade Organization (WTO) started a sequence of efforts focused on improving the policy consistency of their relevant organizations (Aslam, 2001). The policy coherence links to encouraging trade liberalization in southern countries.

The World Bank and the IMF have long constituted trade liberalization along with their various policy prescriptions connected as loan stipulations in their agreement with borrowing members. At present, there is better coordination of these efforts with the membership needs of the diverse agreements in negotiation inside the WTO. On a summit in 2001, the World Bank declared that they have 60 billion dollars to give out as loans to Latin American countries over 5 years (Cali, Ellis, & Willem, 2008).

The main objective for IMF and WTO was to improve their operational purposes towards more trade liberalization. The economy of the world is growing in its integration. There is exportation of more output share throughout national borders. Almost half of all services and goods produced globally sell in different nations, instead of domestically. This percentage is higher than that of 1960, which was mostly the export of goods. A significant current trend is service globalization such as insurance, travel, information services, and financial.

What drives globalization are factors such as technological