The Effects of Globalization on the Developing Countries - Case Study Example

Globalization and Outsourcing Offshoring s 3rd March, Introduction Globalization has had a tremendous effect on employment relations in countries that have a good relationship or are well integrated with the global market. The increasing growth of the service sector outsourcing and offshoring in many developing countries has seen new a breed of employees (Cusmano, Mancusi & Morrison, 2010). The economy challenge of solving the inadequate supply of skilled labor which leads to high turnover in a given economy has remained unanswered. Outsourcing and offshoring which brings in new and skilled manpower from the developed countries have impacted the middle-class and the workers who are unskilled in the developing countries remain unemployed. This study will seek to examine the effects of globalization to the developing countries and if it actually has more economic merits than the demerits. The study will also find out the impact that globalization has had on the environments of the developing countries and \possible ways of managing those problems, if any. Globalization can be defined in an economic terminology as the integration of national economies by means of merging trade, investment, capital flow, migration of labor as well as technology (Cusmano, Mancusi & Morrison, 2010). Advances in telecommunications and the growth of the transport sector have been the major drivers of globalization and the success of internet can also be said to have steered globalization. It has been found that globalization has effects on business and work, economics, socio-cultural resources and of course, the environment. On the other hand, outsourcing can be said to be the transfer of employees from firm A to firm B which can be generally said to be contracting out a business from party A to party B. outsourcing has been catalyzed by globalization and now there has been shifting of industrial production from developed countries to developing countries. Although globalization is undoubtedly one way of strengthening international ties with other countries, the negative impacts posed by it in the form of distributional effects (Martens, 2010). While liberalization was expected to assist the relatively abundant factor in the developing countries; the less skilled, it is vividly evident that this is not the case relative to workers with higher skill or education levels. Exposure to international trade has demonstrated that it affects the distribution of incomes within the country and especially in the developing countries. While the influx of foreign businesses and foreign capital reduces the level of unemployment and poverty, it also widens up the wage gap between the educated and the uneducated. Although the levels of education would rise with the improvement of financial health, the poor becomes poorer in the short time (Perry et al., 2011). On the same note, market liberation due to globalization allows transfer of capital and business from the developed countries to the developing ones. Some businesses may be set up in countries where they do not have skilled labor for a certain line of job and therefore, the developed countries are forced to hire from their own countries. In this situation, the citizens of host country continue to suffer from unemployment as the levels of education are usually low in the developing countries. This should not be the case as investing in developing countries should boost the employment chances. Further, due to open market and outsourcing, the only skilled labor that a certain developing country might boast of could be transported to the developed countries or other developing countries to pursue their career away from their home nations. This starves the nation of some important skilled labor that would otherwise steer the country forward in terms of development. Globalization has led to faster access to technology, innovation and improved communication. However, it has featured extensively in the debates about environmentalism and environmentalists have highlighted its scorching effects on the environment (Ostry & Spiegel, 2004). Activists have observed that globalization has led to a significant increase in the consumption of goods which has impacted ecology negatively (Efendioğlu, 2007). Increased consumption leads to increased production to supply the demand and this puts a strain on the environment. On the same line of thinking, increased production of goods due to increased demand has led to more transportation of these products. The fuel used in transportation these products from one country to another is burnt to increase the levels of pollution (Shaqiri, 2013). Noise pollution and landscape intrusion have also been as a result of globalization. Transportation has also put a strain on the non-renewable energy sources such as gasoline; the ozone layer has been depleted by the burning of the airplane fuels resulting to increasing levels of greenhouse effects. Industrialization in the developing countries as a result of globalization has improved the lives of the citizens and raised their standards of living but this positive contribution to the society has been marshaled by the dumping of waste product into the ecological sites. This has in turn killed many marine animals and destroyed life in the oceans. A good example of this instance was the leaking of the British containers in the year 2010 which had severe implication on marine life (Shaqiri, 2013). Globalization and industrialization has resulted to various chemicals being thrown into the soil and especially in the developing countries. As a result, many noxious weeds and plants have grown, plants have been damaged by these toxins hence their genetic life has been tampered with. It should be remembered that managed developing countries that are in good climatic regions depend on agriculture as their main economic sector (Smith, 2006). A good example of this type of a third world country is Kenya who depends on the growing of Tea and Coffee as their main economic sectors. In order to set up new industries while on the course of globalization, there has been destruction of natural resources to pave ways for new industries. This move by the developing countries has seen important landscape such as mountains flattened to create rooms, water reservoirs drained away and wildlife tampered with; all for the sake of industrialization. Putting all these factors together, it is evident that globalization has had so many adverse impacts on the environment that we live than the positives that it has brought forth. No wonder, many pundits argue that for developing countries, globalization has caused so much damage, even if policymakers do not seem to notice this phenomenon that is looming clearer every day. It has made so many changes in people’s lives that are otherwise irreversible. The solution lies in the appropriate mechanisms that would put all these effects together and check to which extent has globalization had on the environment (Smith, 2006). Interestingly enough, researchers point out that the solution to this particular predicament lies within the problem itself; that globalization can lend aid to build a good platform which has economic feasibility and economic friendship. Globalization has been known to be about competition and prominence and if a private company majored on environmentalism, it is certain that others would follow suit and this would be terrific for economic consumption. Conclusion Having discussed the impacts that globalization has had on all the fronts of our living: the unemployment factors it brings about, the economic stagnation of developing countries, issues with distribution of income in the society, deprivation of developing countries of precious skilled labor and more importantly the environmental degradation; leaves a lot of question without answers. The most important area of concern though is the environment. It is unfortunate that investors have not prioritized in preserving the environment that we live in, while investing. For these reasons, I really think that globalization has not really raised the living standards of the people in the developing countries. Taking into the account all the points discussed in this study, one would really think that the governments need to restructure the rules of market liberation and globalization because developing countries have been the scapegoats for so many frailties of globalization. They should understand that economic development and environment are two inseparable entities. In fact, protecting the environment and promotion of economic growth are complementary goals. Research has it that poverty in the developing countries is a leading factor in environmental degradation. Protection of environment which has all the resources, would be a good step in boosting economic growth and it is the idea behind the crucial sustainable development movement which seeks to promote and advance economic opportunities for the poor developing countries, but in extremely environmentally friendly means. References Cusmano, L., Mancusi, M., & Morrison, A. (2010). Globalization of Production and Innovation: How Outsourcing is Reshaping an Advanced Manufacturing Area. Regional Studies, 44(3), 235-252. doi:10.1080/00343400802360451 Efendioğlu, A. (2007). Globalization Through Offshored Outsourcing: Benefits & Consequences. ISGUC, 9(1), 19-35. doi:10.4026/1303-2860.2007.0034.x Martens, P., Akin, S., Maud, H., & Mohsin, R. (2010). Is globalization healthy: a statistical indicator analysis of the impacts of globalization on health. Globalization And Health, 6(1), 16. doi:10.1186/1744-8603-6-16 Ostry, A., & Spiegel, J. (2004). Labor Markets and Employment Insecurity: Impacts of Globalization on Service and Healthcare-sector Workforces. International Journal Of Occupational And Environmental Health, 10(4), 368-374. doi:10.1179/oeh.2004.10.4.368 Perry, R., Ommer, R., Barange, M., Jentoft, S., Neis, B., & Sumaila, U. (2011). Marine social- ecological responses to environmental change and the impacts of globalization. Fish And Fisheries, 12(4), 427-450. doi:10.1111/j.1467-2979.2010.00402.x Schindler, F. (2006). Perspectives on globalization and outsourcing. IEEE Microwave, 7(1), 22- 26. doi:10.1109/mmw.2006.1614222 Shaqiri, D. (2013). Globalization: The Tendency of Increasing Sales and Production through Outsourcing. International Journal Of Academic Research In Economics And Management Sciences, 2(4). doi:10.6007/ijarems/v2-i4/86 Smith, B. (2006). Outsourcing and Digitized Work Spaces: Some Implications of the Intersections of Globalization, Development, and Work Practices. Journal Of Adolescent & Adult Literacy, 49(7), 596-607. doi:10.1598/jaal.49.7.5 Smith, B. (2006). Outsourcing and Digitized Work Spaces: Some Implications of the Intersections of Globalization, Development, and Work Practices. Journal Of Adolescent & Adult Literacy, 49(7), 596-607. doi:10.1598/jaal.49.7.5 Read More