Winners and Losers of Globalization

Winners and Losers of Globalization

There are winners and losers of globalization. Globalization can be defined as a process that entails integration and interaction among people, governments and companies of various nations. As a process, globalization is driven by international investment and trade and it is facilitated by information technology. Globalization has affected the environment, political systems, economic prosperity and development, culture and the physical well-being of humans in societies and globally.

Why there are winners and losers of globalization

Although globalization is seen as a good thing by some people especially the rich, others see it as a bad thing. This is due to the conditions that different people across the world are predisposed to. The world is divided and critics argue that apart from uniting people across the world, globalization is also making the world more divided. For instance, in the 1960s, 70 percent of the global wealth was controlled by 20 percent of the population of the world. As of 2000, this share had risen to 80 percent. As such, the rich seem to get richer, while the poor are becoming poorer.

Losers of globalization

  • The poor

Poor members in the society do not have the ability to play a role in the economy at a global level. This is because most of them cannot write or read. Others use the wrong language in their communication. On the other hand, wealthier people can afford the education of their children up to higher levels. Additionally, most local jobs that the poor members of the society used to do in the past have now been mechanized to enhance efficient production. This implies that the poor are some of the losers due to globalization.

  • Governments

Due to globalization, states cannot control their economies fully. Several online companies have come up and some of them are difficult to control. Some of these companies are outsourcing labor from different countries. People are also working for online companies without paying income taxes. This implies that governments are losing because they are not collecting more revenue as they should.

Winners of globalization

  • Global middle class

The middle class, particularly in countries like Indonesia, Brazil, India and China has benefit from globalization. The real income of the middle class globally has gone up by over 60% within a period of 20 years. This can be attributed to economic growth that countries like China and India have experienced. The real income of this group was also adjusted by inflation.

  • The rich

Chief executive officers and the rich people are perhaps, the major winners of globalization. Globalization has largely benefited Transnational Corporations and their owners. For instance, Microsoft’s CEO, Bill Gates, had accumulated personal wealth amounting to $52.8 billion as of 2001. This amount is the same as the national incomes of several countries combined. The 200 richest people have accumulated wealth that is greater than that of 41 percent of the poorest people in the world. These are about 2.4 million people.

What can be learnt from the winners and losers of globalization?

From the analysis of globalization’s winners and losers, it is apparent that this process has made the world more competitive. In this world, the unskilled are faring poorly. They operate as commodities that are easy to replace in the ever-growing overseas supplies. The gap between the poor and the rich is also widening. For instance, every year Africa spends $14.5 billion in repaying debts to international organizations like the World Bank and the International Monetary Fund. At the same time, Africa receives $12.7 billion every year in form of aids from the other countries. By getting low-skilled and poorly paid labor in the developing or less developed countries while ensuring that higher skilled as well as better paid jobs go to people in the developed countries, Transnational Corporations are deepening the existing divisions among countries.

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