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The process by which people, cultures, money, goods and

information can be transferred between countries with few or no


barriers
Rostow’s Model

In 1960 WW Rostow developed his model by studying 15 countries


(mainly in Europe) that suggested that all countries had the
potential to break the cycle of poverty and to develop through 5
linear stages:
• The traditional society
o Subsistence economy
o Mainly based on farming
o Very limited technology or capital to process raw
materials or develop industries ad services
o E.g. Ethiopia

• Preconditions for take-off


o Needs an injection of external help to move into this
stage
o Extractive industries develop
o Agriculture is more commercialised and becomes
mechanised
o Some technological improvements and a growth of
infrastructure
o Development of a transport system encourages trade
o Single industry (often textiles) begins to dominate
o Investment is about 5% of GDP

• Take-off
o Manufacturing industries grow rapidly
o Airports, roads and railways are built
o Political ad social adjustments are necessary to adapt
to new way of life
o Numbers in agriculture decline
o E.g. India

• The drive to the maturity


o Growth is self-sustaining
o Economic growth spreads to all parts of the country
o Increase in the number and types of industry
o Rapid urbanisation
o E.g. Venezuela

• High mass consumption


o Expansion of tertiary industries and welfare facilities
o Service industry increases
o Manufacturing industry decreases
o E.g. UK and the USA

2 3 4 5
UK 1750 1820 1850 1940
USA 1800 1850 1920 1930
India 1950 1980 - -
Ethiopia - - - -
Transnational Corporations (TNCs)

• A company that has operations in more than one country

• Grown by buying up foreign firms in mergers and acquisitions


e.g. Guinness and Smirnoff owned by Diageo

• Much of manufacturing is subcontracted to third parties


making it hard to regulate working conditions

• Link together groups of countries through the production of


goods (most manufacturing TNCs are ‘assembly industries’)

• Forge connections between people in different countries by


shaping common patterns of consumption

Reasons for the global nature of TNCs:


• To be closer to their separate markets (these may
need to be served different, depending on cultural
needs – Glocalisation) e.g. McDonald’s
• To operate inside local trade barriers, such as tariffs
and quotas
• To operate where labour is cheaper and less
regulated
• To spread the risk (e.g. those associated with
industrial action or crop failure) e.g. Ford – if a store
in London loses money, then a store in Manchester
could ‘save’ them
• To gain grants and other rewards from national
governments who are trying to attract inward
investment e.g. South Wales and Sony

TNCs grow for 3 main reasons:


• Motive – maximising profits by controlling costs:
o Horizontal Integration
 By buying up the competition
 E.g. Ford moved from mass-market sales to up-
market sales by acquiring Jaguar, Volvo and Land
Rover
o Vertical Integration
 By controlling and owning every stage of
production from exploration and research through
to sales
 E.g. Exxon owns oil wells, oil tankers, oil refineries
and petrol stations
o Economies of Sales
 Companies expand production to increase
efficiency and reduce unit production costs

• Means – financial support from banks:


o Traditionally overseas investment has come from
OECDs/core countries
o Has been a recent trend of investment from developing
countries – a ‘reverse colonialism’

• Mobility – improved transport and communications:


o Is faster/cheaper to move goods
o Improved communications systems – fibre optic and
digital technology

Benefits that a TNC brings to the country of origin:


• Profit
• Jobs provided (planning etc.)
• Brings status to country – more TNCs attracted

Advantages and Disadvantages that TNCs Bring to LEDCs:

Advantages Disadvantages
Develop trade links with other Few skilled workers are
countries employed – jobs are often
repetitive and low-skilled
Bring work and use local labour The needs of the country are
rarely considered
Improve roads, airports and Local labour is usually poorly
services paid
Provide new technology Products being made are often of
little value/too expensive for
local people
Improve education and work Companies may leave country at
skills any time leaving many locals
with no jobs
Provide money for new industrial Often create pollution
projects
Help develop mineral wealth (sell Most of the profits go overseas
natural resources)
Improve energy production Minerals are usually exported

Glocalisation:
• Changing what you sell to suit the target market/needs of the
people in different countries
• e.g. McDonald’s have to change their menu in India to suit
their religion
McDonald’s

Background Information:

General UK
First restaurant opened in 1955 First restaurant opened in 1974
in the US
30,000 restaurants in 120 1200 restaurants
countries
50 million customers a day 2 million customers a day

They have often been viewed in a negative light because:

• the high-fat, low fibre diet can cause diseases such as cancer,
heart disease, obesity and diabetes
• they harm/destroy the environment by
deforestation to make way for cattle
ranching
o they produce over a million tonnes of packaging – used
just for a few minutes before being discarded
• they bombard children with adverts, toys and schemes in
schools – many parents object to this
• they are responsible for killing 100s of
1000s of cows
o they use chickens from windowless factory farms
• by spreading all over the world they are merging cultures
• there have been many complaints from
employees about:
 discrimination
 lack of rights
 understaffing
 few breaks
 illegal hours
 sewage in the kitchens
 sales of food which has been
dropped on the floor
 NAMED: MCJOBS

Rebranding McDonalds:

• Using its products from local farms


• Not transporting goods by aeroplane, only using lorries in the
same country – reducing CO2 emissions
• Redesigning their restaurants into a more modern feel rather
than a greasy restaurant
• Using coffee beans from the Rainforest Alliance from
sustainable farms in Colombia, Brazil and Central America
China – Is it ‘Switched On’?

- Economic development is a relatively recent phenomenon


- 1995 – GDP per capita = $620
- 2005 – GDP per capita = $1,700
- development aided by natural and human resources

- Natural Resources:
o Reserves of coal, oil and natural gas
• Used to fuel the industrial development of
the country
- Since 1900s China has also been developing its energy base,
with new hydroelectric and nuclear power stations
- Surrounded by developing markets e.g. South Korea, Taiwan
and India, its on the major trade routes
 Beneficial for its development

- Human Resources:
o Vast population
• Willing to work hard – in education AND
employment
• Trains 600,000 new engineers every year
• Rural labourers not treated well buy their
employers
o They fuel China’s economic growth
o Shut out of the health care system
o State education
o Live in appalling conditions
(overcrowded)
o Work long hours for little pay

- China has become a divided society:


o Within cities
o Between the:
• Developed urban eastern regions
o Where most production is
concentrated e.g. Shanghai, Tianjin
• Underdeveloped western regions
o Where the majority of poor Chinese
live e.g. Shaanxi, Gansu
- Developing fast BUT at a social cost
- China is in the process of ‘switching on’ fully because half the
population still live in poverty, while the rest are rich and
‘switched on’
The Gambia – Is it ‘Switched On’?

 Remains poorly connected


 Not at the same developing rate as China because it lacks:
 Physical resources
 Human resources
 1995 – GNP per capita = $320
 2005 – GNP per capita = $290

 has no confirmed mineral/natural resource deposits


 has a limited agricultural base/source
 75% depend on crops and livestock for the livelihood
 small-scale manufacturing activities include:
• the processing of:groundnuts
fish
hides that are then
exported
 dependent on aid for any development it may achieve
 Government:
 trying to aid development with spending in the
social sector
 e.g. a girl’s scholarship programme was started in
2001
• enrolling girls from poor households in
school

 The Gambia is ‘switched off’ because it has no natural or


human resources to start developing properly
G20 Summit

 A meeting between the top 20 countries (they represent 85%


of the world’s economy)
 They are discussing the recession and global economy and
how to sort it out
 Different places have different ideas, instead of just the G8s
ideas
China: A Global Winner?

China’s increasing connectivity means it is a global winner because:

 Foreign investments in China reached $63 million in 2006


o Foreign firms are attracted to moving to and investing in
China because:
• Since China joined the World Trade
Organisation in 2001 barriers to foreign
corporations have been removed
• It now has a more open doors policy
• China has low production costs and has
been designated a manufacturing Export
Processing Zone
• With its population of 1.3 billion China
provides a plentiful supply of cheap labour
• China has a large and growing internal
consumer market with rising purchasing
power

HOWEVER:

• Although China had an estimated GDP of $5,300 per capita in


2007 this doesn’t mean a high income for all and 250 million
Chinese people still live on $1 a day
• It has resulted in rapid rural to urban migration and the
working and living conditions for many migrant workers are
poor
• There is:
o increased pollution
o degradation of natural resources
• these problems pose a threat to the sustainable development
of the country:
 soil erosion
 desertification
 steady fall of the water table (especially in the
north)
UK’s Population Structure

• high life expectancy – especially for females


• economically active 15-65 – positive for UK economy – big
contribution to global economy
• fall in fertility rates – links to birth rate

• Drop in population:

o 1980-85 – recession, Falklands war (UK involved)

• Issues:
o Ageing population - pressure on social services
- pressure on families
- tax payers pay for it but less workers
to pay
- therefore taxes increase
o falling consumer base – number of people to buy
products will fall  TNCs affected

• Influx of immigrants to fill the employment gap – has the EU


helped or discouraged this?
Demography
• Study of population’s characteristics and movements

In the UK, to find out how population has changed we would use:
• National statistics – detailed census records dating back to
1801
• Parish registers include information at a local scale, outlining
info such as baptisms/births, burials/deaths and marriages
• Personal recollection of individuals can help us to build a
picture of family history

Population: Inputs and Outputs

Births Deaths

Population
Change of a Outputs
Inputs
Country or Region
of a Country
Immigratio Emigration
n
The UK

• Birth rates and death rates sort of cancel each other out, very
similar

How has the UK’s population changed?

Family size has changed by:


• 1901 = 38 million
• 2007 = 61 million
• In early 1900s, average of 4 or 5 children per family
• Today, only 2 children per family
• Increased life expectancies, resulted in grandparents living
longer

Population structure has changed by:


• Have developed a top heavy population structure
• 1931: 7% = over 65
24% = under 16
• 2009: 16% = over 65
19% under 16

Migration has impacted upon the UK’s population structure by:


• mobility increased
• most important migrations has been movement away from
manufacturing and mining towns, especially in North England
• go towards settlements in higher economic sectors
Migration

Types of migrant and what they do:

Temporary
Stay
Refugee/Asylum Repatriation to
Displace Seekers own country
d Forced to move by (failed asylum
Persons war, famine, disaster Granted requests leads to
or fear of persecution asylum in new deportation)
country

Permanent move for


Citizenship is granted
work or quality of life
and move is permanent
reasons
Voluntar
y
Migrants Temporary move May stay for Returns to
for work reasons weeks or years own country

Voluntary
Illegal individual move
Migrants for work Living and Forced
(may be working until deportation
failed asylum Organised move as
‘discovered’ to own
seekers) part of criminal
country
activity (element of
force)

Migrate for: Social reasons


Demographic
Economic
Environmental
Political

Migration Theory:

Origin – where they have come from


Destination – where they are going
Intervening obstacles – tings that get in the way of migration (i.e.
make it more difficult)
Migration: UK  Spain

• Most immigrants to the UK are fairly young


• Emigrants tend to be older, 60% are over 45
• There are now significant permanent British populations in
several other EU countries
• The most popular of these countries is Spain

• They choose to live in ‘urbanisaciones’


• These are purpose built villa developments
• E.g. Urbanisacion La Marina, near Alicante, construction began
in 1985
• Largest population of non-Spanish residents of any
municipality in Spain. Around 8000 of the 10,000 residents are
foreign and about half from the UK

Numbers of Britons In Spain


Inc. part- Pensioner
Total % male % female
time s
761,000 990,000 74,636 42 41
Breakdown By Age %
0-14 15-24 25-44 45-64 64+
9.5 4.9 24.7 39.4 21.5
Employment Status %
Employed Unemployed Inactive
UK born 30.4 6.3 63.4
Locally born 47.5 7.7 44.7

Why are the Pensioners Migrating?

• Mediterranean climate Leisure facilities


• Awareness of destination Cost of living
• Communications networks (internet) Living longer
• Expatriate community Property market
• Lifestyle of Spanish people Health care
Impacts on the UK

Costs Benefits
Family break-up, Emigration balances increased
grandparents move away immigration, reducing net
migration rates
Loss of potential Fewer older people to take care
childminders of, some health and care
problems are exported
Loss of a highly experienced Relieves pressure to build new
workforce, especially if they homes, and therefore to build on
retire early greenfield sites
The ‘grey pound’ is spent
overseas

Impacts on Spain

Costs Benefits
Immigrant ‘ghettos’ are created, Increased spending in the local
with little social or cultural economy; some retirees are
integration highly affluent
Resentment as immigrants seek Job creation in construction,
to enter local politics retail and other services
House prices become too high Areas that were largely
for local people unproductive scrubland become
valuable building sites
Healthcare costs are borne by
the host country
Physical infrastructure systems
may be strained
The UK’s 5 Tier System to Manage Immigration

Tier 1: Highly skilled


• Including entrepreneurs, top scientists and business people
• No job offer will be required

Tier 2: Skilled with job offer


• People with qualifications/work-related experience
• Job offer in a ‘shortage area’ such a nursing

Tier 3: Low skilled


• Workers from the expanded EU, who do not need prior
permission to arrive

Tier 4: Students
• Those paying for tuition in the UK

Tier 5: Temporary workers, youth mobility


Polish Migrants to the UK

• Eastern European migrants who have moved to the UK have


done so mainly for work. They include:
o Migrants around 30 years old with vocational training or
secondary education and some work experience
o Young migrants, just finished vocational training or
secondary education
o Young and unmarried migrants with a tertiary education
keen to brush up their language skills and attain some
work experience abroad
o Highly-educated specialists with work experience

• The vast majority of the 800,000 to 1 million migrants who


have come to the UK since 2004 are from Poland

• In the past, immigration has tended to concentrate in urban


areas

• Many Polish have settled in rural areas and work on farms and
in food processing

• The UK’s Polish migrant hotspots are: Boston, Peterborough,


Fenland, Herefordshire and Dungannon

• 2007 – 10% of people living in rural areas were immigrants

• Many of these areas previously experienced emigration

• Temporary immigrants send about 25% of their earnings


home as remittances

• Immigrants who plan to settle in the Uk only send about 8%


home

• For Poland, this income was around €6.4 billion in 2006, or


2.5% of Polish gross national income (GNI)

• Polish average earnings in the UK = £6 an hour

• A significant brain drain is occurring


Mumbai – a mega city in Asia

Location:
• Largest city in India
• On a long, thin island in a natural harbour
• On the west coast
• In the opening of Thane Creek
• 650km2 of island
The population has changed by:
• 1951 = 3 million
• 2007 = 14 million
• 2020 = 26 million (projected)
The population has changed so quickly because:
• of its central position in Asia, with easy access to China and
the west  global hub for the world’s TNCs
• home of the Bollywood film industry
The impact of this change has been:
• lack of space
• overcrowded transport systems
• shortage of water  transported from the mainland in
enormous pipes
Dharavi:
• most organised and successful shanty town in Asia
• 60% live in poverty
• citizens live in shanty towns
• densely populated – overcrowded
o 100,000 people live and work in this area
• industries = wide ranging
o produce over $500 million of goods here

Mumbai’s ‘Vision for the Future’ is:


o to have a sustainable mega city
o to have a greener city:
• opening 325 new open spaces
• extra 300 public toilets to deal with sanitation
problems
o to create 200,000 new jobs in service sector  health
care, finance and entertainment
o to make it a world class location by 2013:
• 160 energy efficient trains to earn carbon credits
‘Vision Mumbai’ will work by:
• getting sponsorship to maintain green spaces
• the economy improving its economic growth rate to 8-10%
a year
• need an increase in employment in construction – about
500,000 jobs
• Dharavi given own redevelopment project
o 7 storey apartments will be built to help slum
dwellers
London – a mega city in Europe

Location
• on the River Thames
• south east England

• highest population of any urban area in the EU


 2005 - 7.5 million – 12.5% of the UK population
• 2004 – 220,000 foreign migrants into London
 155,000 British migrants into London
 350,000 moved out
• 260,000 to other parts of the UK

 Finance and tourism – prime industries in 20th century


 Finance and business services – growth of 550,000 jobs in
1993

Vision London: ‘The London Plan’

• Aim is to create an exemplary sustainable world city for the


21st century
• To achieve this will require cooperation between London
boroughs – they must work together to develop commercial
and residential areas, improve transport and communications
infrastructure and promote a sense of community
• The plan splits London into 5 sub regions: West, North,
Central, South and East
• Within these sub-regions, certain areas have been identified
as:
o Opportunity areas
o Areas for intensification
o Areas for regeneration
• There are also other parts of the plan including the congestion
charge and recycling targets
• Congestion charge:
 introduced in 2003 to central London
 extended further westward in Feb 2007
 drivers charged £8 to drive in certain parts of the
city
 proved successful in cutting congestion thus
reducing pollution in the city
• Recycling:
 Started in 2003
 London given £21 million (from London recycling
fund) to improve recycling rates through local
initiatives
 Further £20 million given in 2005
 Money spent on 70 projects across the boroughs
Million City
• A city with population of over 1 million
• There are around 200 of these

Super city
• A city with a population over 5 million

Megacity
• A city with a population of over 10 million

World city
• Cities of power based on:
o trade
o political strength
o innovation
o communication