Each clue stands for something we have learned

Each clue stands for something we have learned about in EQ 1 so far. Write down the answer in the first column and then explain it in the second. Clue 1 WB 2 IMF 3 WTO 4 FDI 5 SEZ 6 TL 7 TB 8 ASEAN 9 OPEC 10 CODP 11 NAFTA 12 SW 13 L & D GC 14 KOF I 15 SO & SO Answer Definition/Meaning/Role in globalisation

Clue Answer Definition/Meaning/Role in globalisation 1 WB World Bank Provides loans for development in countries 2 IMF International Monetary Fund Lend money to maintain international financial stability 3 WTO World Trade Organisation Encourage free trade, discourage restrictions on trade (e. g. quotas) 4 FDI Foreign Direct Investment made by an overseas company or organisation in to a company or organisation which is based in another country 5 SEZ Special Economic Zones Set up by national governments to offer financial incentives to attract FDI 6 TL Trade liberalisation Removal of barriers to trade (e. g. removing tariffs, quotas, tax) 7 TB Trade blocs Countries grouping together to promote free trade between them 8 ASEAN Association of Southeast Asean Nations Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, Vietnam 9 OPEC Organisation of the Petroleum Exporting Countries Saudi Arabia, Iran, Venezuela, Iraq, Qatar, Nigeria, Algeria, Libya, Kuwait, Indonesia, UEA, Ecuador, Angola, Gabon 10 CODP China’s Open Door Policy 1978 welcoming of foreign businesses setting up in China 11 NAFTA North American Free Trade Agreement USA, Canada, Mexico 12 SW Shrinking world The idea that distant places feel closer/take less time to reach 13 L & D GC Lengthening and deepening global connections Lengthening – products are being sourced from further away Deepening – links with more people and places in all areas of our lives 14 KOF Index Annual index of globalisation, measured from 1 (low) to 100 (high)

If this map is the answer, what’s the question? Answer: Apple is richer than all of these countries. Every country in green has a lower GDP than Apple’s annual revenue.

Role of TNCs (Trans-national corporations) L. O: To examine the role of TNCs in globalisation

What is a TNC? • Transnational Corporations (TNCs) are major companies which have a presence (e. g. production, headquarters, sales) in at least two countries. The worlds largest TNC is Walmart. • Many TNCs are so economically powerful and politically influential that they rival national economies in terms of wealth.

Concepts and Ideas • TNCs have their HQ in a HIC, and outsource their production to other countries. • Their products are often sold globally. • They are important in globalisation, both contributing to its spread (global production networks, glocalisation and the development of new markets), and taking advantage of economic liberalisation (outsourcing and offshoring). Using your book, write definitions of these words: Offshoring Outsourcing

How have TNC’s spread globalisation? 1. Global production networks 2. Glocalisation 3. Development of new markets.

1. Global Production Networks • TNC’s have produced complex global production maps as products are made in one country and then sold in a host of other countries too. • There is a long chain connecting many different parts of a TNC together. • Today many TNC’s outsource parts of their business to other companies. This means that the size of the TNC is ever increasing.

1. Global Production Networks • Poorly managed GPN’s can have their drawbacks; 1. When a natural hazard strikes an area, production may have to stop and supply chains are impacted (e. g. 2011 Japan Tsunami) 2. Lack of control over produce (e. g. UK supermarkets and horsemeat scandal in 2013) 3. Relaxed production standards from outsourced companies can lead to tragic accidents. E. g. in Bangladesh when the Rana Plaza collapsed in 2013 killing 1100 people who were making clothes for Wal-Mart, Benetton and Primark. HERE and HERE

Economic Liberalisation • Offshoring: TNC’s move parts of the production process (factories or offices) to others countries to reduce labour or other costs (e. g. import tariffs) • Outsourcing: When a TNC contracts another company to produce the goods and services they need rather than do it themselves. This can create a very complex supply chain.

How do TNCs outsource to different countries around the world? The BMW Minis engine is made in Brazil by a company called Tritec Motors. The other 2500 parts are made by lots of different companies and Mini just assemble them in Oxford at their factory.

Advantages and Disadvantages of outsourcing Advantages Disadvantages • Economically beneficial E. G. Profit made from work that foreign TNCs have outsourced – overseas workers • Overseas workers – earn low wage/work in toxic conditions. • Natural hazards can disrupt global supply chains E. G. 2011 Japanese tsunami 2013 UK horsemeat Scandal 2013 Rana Plaza textile factory collapse, Bangladesh

2. Glocalisation

2. Glocalisation

2. Glocalisation

2. Glocalisation

2. Glocalisation • E. g. Mc Donald's in India does not sell beef or pork and Mc. Donalds, they have the Chicken Maharaja Mac. HERE • In 2012 a vegetarian Mc Donald's opened for Sikh pilgrims visiting the Golden Temple in Amritsar. • Mc. Donalds the UK sells organic milk and all its beef comes from GB farms. Consumers value this local sourcing of ingredients.

Global Networks and Glocalisation: The practice of conducting business according to both local and global considerations. Adapting products to suit local tastes, religion and culture, laws, local interests and lack of availability of raw materials.

Where is this and how is it related to glocalisation? Using p. 177 explain how Disney uses

3. Development of new markets. • New markets are essential and they depend on product design and desirability. • This can involve expanding the market to new customers (e. g. Tata Nano) or updating models so that people want to buy a new model (e. g. mobile phones) • Tata Nano here from 48. 10

Explain the ways in which TNC’s accelerate globalisation. (8 marks) HINTS • BUG • Overall essay structure • Paragraph structure You should divide your answer in to three, using the three key ideas we have discussed over the past couple of lessons

Plan for the week Tuesday Costs of globalisation Wednesday Measuring globalisation Half term Switched on vs. switched off