economic globalisation
... 1948 onwards, and in particular the most recent the Uruguay Round, held form 1986 to 1994 (Hilary 1999). Declining trade barriers and progress in communication, information, and transportation technologies underlies the trend toward globalization. The lowering of barriers to international trade enables firms to view the world, rather than a single country, as their market. The lowering of trade and investment barriers allows firms to base production at the optimal location for that activity, serving the world from that location. With the efforts to lower barriers to the free flow of goods, services and capital between nations by GATT agreements and to the less restrictions to foreign direct investment, more firms, both large and small, increasingly engage in cross-border trade and investment to find larger revenue and profit opportunities in foreign markets. Although other economic forces might influence domestic production and slightly influence trade with other countries, only globalization can have so great power to increase New Zealand trade with other countries. Greater trade with other countries can be both beneficial and harmful to New Zealanders as whole. With greater international trade with other countries, New Zealand can and specialize in the production of what it is good at, make efficient use its production capacity and benefit from the reduced cost by economy of scale. During past decades, New Zealand has developed its agriculture and manufacturing industries to suit the needs of niche markets. Dairy and meat exports continue to make a large contribution to New Zealand's economy. Forestry and manufacturing exports have become increasingly important. Meanwhile, New Zealand import goods what it is not good at, such as mechanical machinery and equipment, vehicles, petroleum, and so on from other countries at a cheaper cost, compared to that cost if it produced them by itself. Local companies can make use of the cheaper imports to make goods to export to the world. Consumers are able to consume lots of goods and services at a cheaper price that would be unavailable otherwise. Although the majority has been benefited from the opportunities of globalization, some others have suffered from exposure to global competitions. The decision of companies to source their production overseas will most certainly impact the employment of such firms at home. On the other hand, some local companies have to close down, or have to ‘rationalize’ to compete against foreign-based companies, when they face great competition from imports. In both situations, labours, especially those unskilled labours, are laid off,. Policies enforced should aim to help those who suffer from import competition. People should be protected from undue losses as a result of international trade (Feenstra 1998). Domestic policy could aim to redistribute benefit, for instance, towards the unskilled and offer training. Through a good social welfare system, the laid off workers could enjoy some benefit from globalization. Through training, unskilled workers could increase their competitiveness and eventually find a job. Globalization also brings more employment opportunities for New Zealanders. Globalization encourages the transmission of international opportunities into local jobs. Lots of people work in multinational enterprises. Meanwhile, the number of New Zealanders working overseas increased gradually during the past ten years, from 41096 in 19993 to 68772 in 1999, and to 71368 in 2001 (Statistics New Zealand 2003). New Zealanders enjoy greater employment opportunities than before. These employment opportunities are results of globalization rather than other economic force. A genuinely free market requires unrestricted movement of labour to allow workers to seek out the best opportunities. New technologies have made globalization possible by making it easier to move capital from country to country. This ‘capital mobility’ has offered job opportunities to those communities which have received investment. In New Zealand, foreign direct investment (FDI) has expanded near 200 times in the past 25 years. These investments are used to set up business or acquiring business in New Zealand. They not only supplies capital, technology, and management resources, but also create jobs for New Zealanders both within the subsidiaries of multinational enterprises and in local suppliers as a result of the investment. Meanwhile, local business, which has expanded as a result of the opportunities provided by the globalization of trade, also provides more employment opportunities. Furthermore, as many previously local, regional and national labour markets throughout the world have now become international, more overseas jobs opportunities are provided for New Zealander. Only in a globalized economy can these opportunities exist. But, these employment opportunities have both advantages and disadvantages to New Zealanders as a whole. The more jobs lowers unemployment rate, increases people...