Chapter 8

Chapter 8

1. What does it mean to live in a globalised world?

2. Driving forces of globalisation

   • Globalisation is defined as the process through which ideas and activities of people in different parts of the world become interconnected. These interconnections can lead to interdependent relationships between developments in the world (global) and developments in a country (local).
   • Eg. An interdependent relationship is one between the producers of laptops and their suppliers of raw materials. The producer is dependent on the suppliers for race material, and these suppliers are also possibly dependent on the producers for business. The producer is also dependent on consumers for the sale of laptops.
   • Advances in Technology
     • Technology advancements in communication have resulted in greater access to internet and the increasing use of mobile communications. These facilitate the communication and exchange of information across the world.
     • Eg. Applications like Facebook and Gmail can be easily installed on a smartphone- a mobile phone with advanced computing capabilities. Through the evolution of the mobile phone, which has made it convenient for people to communicate anytime and anywhere. People around the world are able to connect and communicate through messaging and video calls, as well as gain access to vast amount of information on the internet.
       • With 2.2 billion users worldwide, smartphones offer uses internet at their fingertips and instantaneous access to information. This increase the pace of globalisation by increasing interconnections between ideas and activities of people in different parts of the world, developing interdependent relationships across the world between local and global developments.
   • Growth of Multinational Corporations (MNCs)
     • MNCs are businesses with economic activities in more than 1 country. As MNCs continue to grow in their number and size, they control more aspects of international trade and investments, employing 690 million employees in 2014 from 20 million in the 1990s. The global span of their operations drives globalisation as they increase the economic interconnections between people and goods throughout the world. These interconnections can also lead to interdependent relationships between the parties involved in the operations of MNCs. Singapore is the home to many MNCs, both locally and foreign owned. (Eg. Singtel, Singapore Airlines). This makes Singapore a major site of international business today. Since 1965, many Singapore companies expanded overseas. This has created interconnections and interdependent relationships between economic activities in Singapore and the rest of the world.
       • Foreign owned MNCs have brought many benefits in terms of providing employment, higher wages and bringing in new technology and expertise to sustain Singapore's competitiveness. In turn, these MNCs have benefitted from Singapore's strength as a global business city with a pro-business environment governed by the rule of law. Apart from providing economic benefits, MNCs also facilitate the exchange of ideas between countries. (Wg. Foreign owned pharmaceutical and biotechnology MNCs such as Roche, established collaborations with institutions in Singapore to conduct research and develop solutions to improve healthcare around the world. Collaborations such as these illustrate interdependent relationships between MNCs and local institutions as they leverage on one another's strengths and expertise in reaching their goals.
   • Developments in Technology
     • The world have "shrunk" in terms of the time needed to get from one place to another. This is achieved through the improvements in the size and speed of different modes of transportations, and the development of efficient and integrated transportation infrastructure such as airports, seaports, railways and expressways. Improvements made in the size and speed of transportation modes enabled more goods and people to be carried per trip. This led to savings in the transport costs.
     • Eg. Singapore has extensive rail and road networks that provides a high degree of connectivity between neighbouring Malaysia and herself. Singapore's connectivity to the world is also achieved through its airports and seaports (Eg. Changi Airport served 320 cities in 80 countries and territories, with 6700 flights per week. 140 000 vessels arrive per year and Singapore is connected to more than 600 ports in over 120 countries. More than 130 000 vehicles cross the causeway between Malaysia and Singapore daily). Singapore also maintains its lead by increasing its capabilities and capacities. It is still in the talks to build 2 new links- the Kuala Lumpur- Singapore High Speed Rail and the Johor Bahru-Singapore Rapid Transit System.
       • Through the provision of efficient, reliable and quality service, Singapore is recognised as one of the world's leading transportation hubs. When goods and people can be moved around the world more quickly and at a lower cost, it facilitates the process through which people's activities and ideas become interconnected.