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1.When was the term "globalisation" coined?

2.What are the causes of the great leap forward in globalisation?

3.What risks are entailed by globalisation?

4.Does Germany and the German economy benefit from globalisation?

5.Does competition cost jobs?

6.Does globalisation change the importance of nation states?

7.Does globalisation restrict the scope for action of national politicians?

8.What is the contribution of the EU to shaping globalisation?

9.What is the role of the World Trade Organization (WTO)?

10.Is there a correlation between globalisation and sustainability?

1>When was the term "globalisation" coined?

The term "globalisation" was first coined in the mid-nineteen nineties, and has since become an
omnipresent buzz world. The phenomenon, however, dates back much further, indeed to the
Ancient World.

Even in those days trading routes criss-crossed the known world. With the discovery of the "new
world" and the sea route to Southeast Asia, the volume of trade rocketed, and spread across the
entire world.

Semantically, however, it is only now that "globalisation" is truly appropriate. The global village is a
reality. The entire world is networked such that it has become one big village.

2>What are the causes of the great leap forward in globalisation?

The meteoric pace of technological development, especially the Internet.

Ever lower costs of communication and transport

The more rapid liberalisation of markets, including capital markets

The dismantling of customs barriers and other obstacles to trade

The establishment of regional economic areas

And, last but not least: the end of the Cold War and the fall of the iron curtain.
3>What risks are entailed by globalisation?

Globalisation, like most other developments, also has a down side:

The international division of labour means that simple tasks can be outsourced to other countries.
Textiles and toys, for instance, have often travelled half way around the world before they land on
the shelves of our stores.

The long road, sea or air transport routes cause air pollution.

Critics see a danger that environment protection will be considered a luxury and will be a
disadvantage in international competition to attract business.

Many people in Germany believe that they personally suffer as a result of globalisation. They do not
understand the process of globalisation and do not feel that they have been given enough
information. This is reflected in the number of NGOs (non-governmental organisations or interest
groups) and their level of commitment.

Governments are responsible for putting in place international structures to guide globalisation
along acceptable paths, ensuring for instance that it is socially equitable.

4>Does Germany and the German economy benefit from globalisation?

When everything is taken into consideration, Germany is a clear beneficiary of globalisation. In


Germany, roughly every third job depends directly or indirectly on exports. This is particularly true in
mechanical engineering, the automobile industry and the chemical industry.

Free trade guarantees the long-term survival of these jobs, and generates new ones. Our balance of
trade has been in the black for a great many years. In other words, Germany exports more than it
imports.

This means that international trade brings more money into the country than Germany pays for its
imports. Germany is the undisputed world champion when it comes to exports.
5>Does competition cost jobs?

Globalisation and free world trade do of course bring with them the risk that unskilled tasks will be
performed in other countries where labour costs are lower. This has already led to the transfer of
mass manufacturing of low-price products being moved abroad, with the concomitant job losses at
home.

But no country can opt out of international competition. National economies adapt. They generate
new products and services, new markets and new jobs, and thus new prosperity. Any attempt to
barricade the German market would mean economic decline for our country.

6>Does globalisation change the importance of nation states?

Globalisation, as a worldwide process, stretches over a longer period of time. It has become
apparent that essential challenges facing us can only be tackled jointly, and decisions that affect the
future of our plant such as climate protection, fair trade, protection against pirate products, and
global diseases such as HIV/AIDS and avian influenza can only be taken at global level.

This is then the role of bodies such as he European Union and the United Nations. Nation states can
continue to exert an influence on political and economic developments.

Institutions such as the United Nations' World Trade Organization, the World Bank and the
International Monetary Fund provide platforms for action for nation states. Other informal groups
also meet in this context, with the G8 probably the best known.

International interdependence engenders the need for global cooperation. This is termed global
governance.

This term is used to mean the common political shaping of the globalisation process. It aims to
counter threats such as poverty, financial crises or any other conflicts by acting together.

7>Does globalisation restrict the scope for action of national politicians?

Firstly, we must realise that nation states have never in history been totally free to do as they liked.
Today more than ever before, national politics must be aligned to international cooperation and
must play an active part in shaping the process of globalisation Generally valid rules must be
developed, which also take account of national interests. The scope for action of national politicians
is only really restricted if the challenges of globalisation are not accepted and tackled but ignored,
such that politicians forego their opportunity to influence the process.

8>What is the contribution of the EU to shaping globalisation?

The Lisbon Strategy

The competitiveness of EU businesses must be further strengthened. This was the background to the
development of the Lisbon Strategy in 2000. It aims to promote industry and employment in EU
states by ensuring better education, more research, greater innovation and an increase in
investment in member states.

The euro

The common European currency has become the second world reference currency along with the US
dollar.

Common standards

EU guidelines harmonise European living and legal standards. European environmental and social
standards are exemplary worldwide. The right to set up and join free trade unions is crucially
important in this context.

9>What is the role of the World Trade Organization (WTO)?

The worldwide removal of obstacles to trade and investment is of primordial importance to smaller
economies and developing countries in particular.

Thus, the World Trade Organization has set itself the goal of better integrating developing countries
into world trade, improving their access to world markets and thus laying an important foundation
for building prosperity in these countries.
10>Is there a correlation between globalisation and sustainability?

Sustainability means that every generation must solve its own problems, and may not simply pass
them on to the next generation. National and international politics must respect this concept.

Globalisation and sustainability are thus two sides of the same coin. Globalisation means making the
most of opportunities offered and being successful in business. On the other hand, business and
trade are inextricably intertwined with ecological issues, indeed they are dependent on ecological
factors. In a sick environment, the economy too is doomed.

This dependence gives us important rules. Global challenges can only be mastered if we respect the
principle of sustainability.

Is there a correlation between globalisation and sustainability?