Globalization promises a lot for the future of the world, however the same sections it’s suppose to benefit, it seems to have a reverse affect. It is understood that with every decision there is an opportunity cost, but is that decision worth making if it worsens the very thing it is suppose to benefit? The example provided above about America and the reverse affects of outsourcing is a perfect example of the paradox that globalization presents
Jamaica & Globalization
Jamaica is a great case study to use to show how globalization—specifically economic globalization—negatively affects developing countries. Jamaica, with hesitation opened its doors to the foreign market, to help its debt crisis, and with much help from the IMF and multinational corporations, their local and national economies were destroyed, their debt increased, they became self-reliant on foreign aid and business, social conditions worsened and the country was left destitute, with no way to overcome its problems.
After watching the movie “Life and Debt” in class, my perception of globalization was tweaked. How could a process that promised much good for the world, and has so far, delivered on such, too contradict itself? The movie exposed the truth about Jamaica’s economic and political situations, which suffered after WWII and the 1973 world convulsion; and later under the abusive hand of globalization accompanied by the lack of help from allies and the IMF. The oil embargo of 1973, by OPEC—which served to target the U.S and their foreign policy in the Middle East, specifically their alliance with Israel—had negative implications for the global oil markets. Oil prices soared, affecting many countries and devastating many others, like developing country Jamaica, which unlike the U.S and China, could not even lean on domestic oil reserves to counter the impacts of the embargo; but who had to import all their oil. Jamaica could not afford the impacts of the embargo, and needed to borrow money to survive. Although the IMF—an organization created after WWII to help restore economies—offered to help Jamaica, they were not interested in helping long-term and made heavy stipulations that would continue to worsen their economic, social, and political status.
Jamaica had to devalue their currency. After devaluing their currency, the new global economy had swollen Jamaican markets. They were importing goods that were unequal to their exports, thus they were spending more money than they receiving in revenue. Local markets shut down because they couldn’t compete with the foreign companies that took advantage of the lowered currency and sold their imports for cheaper; and certainly did not buy from the local businesses. Farmers could not compete, and needed to borrow money from the Jamaican government, to sustain. The government saw this as an opportunity to gain profit from interest rates, so that they could pay back the money they borrowed—which had extremely high interest...