Spontaneous Globalization Autonomous versus Orchestrated

Apart from the forces of managed globalization, there is "spontaneous" globalization: globalization that occurs through market forces, technological advances and the rise of civil (and uncivil) society. One could argue that the so-called autonomous globalization may have both negative and positive effects. On the negative side, one can identify possibly three trends. The first is what I refer to as the tragedy of free trade. The second is the rise of vertically integrated markets and the third is a focus on some instruments promoted by civil society— namely eco and sustainability labelling [45]. There are several other trends in media, the World Wide Web and cultural shifts, but this chapter restricts itself to the first three.

While at the heart of capitalist globalization is the concept of free trade, a major challenge for the developing countries is that as long as they focus on resources such as food products there is a problem. As the quantity of food products increases, the price will fall, often to levels below what is sustainable to the farmer. Sometimes, because the price of these products is so low, the developed countries protect themselves with subsidies and tariffs in order to support their own domestic agricultural sector (e.g., the Common Agricultural Policy of the European Union). Sometimes the more differentiated food products which can command higher prices at the international market face different challenges when companies patent these crops in other countries and farmers and governments have to engage in dispute resolution in foreign courts (e.g., the disputes regarding Basmati rice in the U.S. courts). This implies that these companies have to diversify continuously and focus more on other types of products and services if they wish to compete successfully. In a previous paper I argued that hunger, a major developing country problem, is also partly the result of the "tragedies" in global governance in the areas of food aid, over-production, structural adjustment programs, free-trade, the EU's Common Agricultural Policy and the global fishing regime, intellectual property rights, and green and gene technology [45].

A related challenge is that in the international arena only the large companies with huge economies of scale are able to provide products at competitive prices. This has led to a vertical integration of markets such that the bulk of coffee, cocoa and banana crops are concentrated in the hands of a few companies. The vertical integration often implies that these big companies dictate to farmers what seeds, pesticides and herbicides they may use, and thus may increase the costs to the farmers while providing themselves low prices, since the farmer has no alternative market to sell his products to. There is increasingly less and less space for small farmers and companies to compete in a globalizing world.

Finally, in an attempt to control these companies, well-meaning civil society and non-governmental organizations are forcing these companies to adopt socially conscious practices. This is leading to a rise in voluntary codes and eco and sustainability labelling schemes as well as fair trade schemes. These are all voluntary and are developed by individual companies (and sometimes) countries. They may under limited conditions violate WTO rules, but there are ways to ensure that they don't. Nevertheless, the multiplicity of these schemes means that producers in developing countries have to meet different conditions to sell to different countries and often the conditions are either not known, or do not take the local circumstances into account. This can have a potentially devastating effect on those who wish to export to other countries [46].

One can also identify three positive trends. The comedy of technology is that jobs can move to other parts of the world without involving any physical movement of labor. Thus, outsourcing has become a major source of income in some parts of the developing world, leading, however, to a loss of income and jobs in the developed world, although no doubt the Western companies capitalize on the profits. Besides outsourcing, jobs are simply moving overseas where labor markets are much cheaper. The lack of restrictions on capital also implies that southern capital can be invested in Western land, labor, infrastructure, and technology. More recently, the attempt by Dubai, Inc. to purchase American ports raised a major debate in the U.S. about how safe this was in the post-9/11 world. The rise of the global media both Western (CNN and BBC) and also southern (Al-Jazeera), and the rise of the Internet as a source of information provide alternative perspectives on what is happening globally.

In the world of spontaneous globalization, there are problems with the lack of transparency in currency trade where speculators often wreak havoc on the economies of countries. Global media can often become the mouthpiece of a few powerful governments and spread propaganda, especially at times of security crises. This leads Herman [6,47] to argue that spontaneous globalization is engineered by corporate elites and is an attack on democracy. He argues that the project of globalization has been pushed by the rich and has been carried out behind closed doors and this has weakened democracy both directly and indirectly, since it is not a process that has been deliberated, discussed and voted on.

Negotiating Essentials

Negotiating Essentials

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