Glob Il Ization

8/13/2019 Glob Il Ization

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Challenges of Globalization

An overview of the challengesand impacts of Globalization

on the Tourism Developmentin Ethiopia


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Introduction This syndicate presentation will try to put forward the challenges thatGlobalization will bring if Tourism Development practices are unmanaged and

uncontrolled well.

IN general it has sections, in the first section it will try to define the term

Globalization, then tried to discuss some of the major challenges that

Globalization has brought especially in the developing world.

The presentation would try to disclose further the merits and demerits

globalization in terms of developing the tourism sector in Ethiopia further outlines

the danger behind joining the World Trade Organization.

And finally on the Way Forward section it was tried to put forward some

recommendations and directions thought to be important before or during

implantation of Tourism Development programs.


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Objective To divulge further the hidden challenge that

Globalization has in our effort to develop the

tourism sector.


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.

What is Globalization?Globalization may be defined in several ways and from differentperspectives:

The widening and deepening of international flows of trade,

finance and information in a single, integrated global market.

Increasing linkages between the worlds people (including the

international spread of culture. as well as diseases, terrorism,

crime..) as natural and artificial barriers fall.

The transformation (shrinking) of the world into a global village,

as borders disappear, distances shrink and times shortens.


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Illustration of Changes in space and time Average ocean freight and port charges per tone fell by more than two third

between 1920 and 1990, from US$ 95 in 1920 to US$29 in 1990.

Air Transport cost decreased even more and travel time have also bee

shortened; average revenue per passenger mile fell by more than 80%

between 1930 and 1990 from US$ .68 to US$ .11 in 1950. It took four daysto fly form Manila to New York but now under a day.

The largest cost and time reductions have occurred in communications, The

cost of a 3 minute international call between New York and London fell form

US$ 245 (in 1930) to US$ 32 in 1970 and to US$ 3 in 1990. At present it costs

less than US$ .10.

Artificial barriers to trade such as tariffs and quotas have also been broughtdown; Other artificial barriers of a more political and social nature, such as

the cold war and apartheid have likewise been toppled.


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Characteristic of the Current Globalization new markets (e.g., globally linked financial markets working

around the clock with new instruments

global consumer markets with global brands

E-commerce new actors (e.g., multinational corporations, the World Trade

Organization, proliferation of international NGOs, regional

blocs, policy coordination groups),

new rules (multilateral agreements in trade, conventions on

human rights, on global environment),

new tools of communication (e.g., cell phones, faxes, e-mail)


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Drawbacks of Globalization1. Unbalanced Distribution of Benefits: Between Countries.The first negative aspect of globalization is that its gains are

not equally distributed, both between and within countries.

Examples of the badly skewed distribution among countries ofthe benefits of globalization can be gleaned from the

following data from the period1980 to 1997: While world per

capita income increased, per capita income contracted in fifty

nine countries, widening income disparities. Exports of goods

and services grew at less than 5% annually in 46 countries,and at less than 1% a year in 9 countries.


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Drawbacks Cntd.2. Unbalanced distribution of benefits: Within Countries.

The benefits of globalization are also badly skewed

within countries, both developing and developed.

Income inequality is rising in many countries,particularly in the OECD countries. Worse, job and

income insecurity is increasing, particularly for unskilled

labor, although corporate restructuring has also meant

job insecurity for professionals.


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Drawbacks Cntd.4. Contagion: The closer linkages that characterize globalization also

allow for contagion and worldwide recession, or at least slowdown.

5. More human insecurity: crime, disease, and loss of cultural identity.

Unfortunately, the many opportunities opened up by the widening

and deepening of information flows and contacts among the worldspeople also include increasing opportunities for crime (trafficking in

drugs, weapons, women, international syndicates), for the spread of

HIV/AIDS as well as ideas, and for the flow of culture and cultural

products which may lead to cultural homogenization, which, while

considered enriching by some, is considered as a loss of culturalidentity by others.


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Drawbacks Cntd.3. Financial Volatility: Globally integrated markets have

financial volatility as a permanent feature, the frequency

of financial crises increasing with the growth in

international capital flows. The human costs of suchfinancial volatility can be very high, as shown by the

effects of the global crisis bankruptcies, poverty

increase, rising unemployment, reduced schooling,

reduced public services, and increased social stress and

fragmentation in short, a reversal in human

development.


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Drawbacks Cntd.6. Environmental factors: Due to the great

consumption patterns created by globalization

and the demand of the products, production has

to be stepped up. A large number of industries aresetup all over the world so people start destroying

large forest lands. Rapid destruction of forests

causes serious threat to both plants and animals.

Due to decline in the number of trees


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Drawbacks Cntd.7. Capitalism: International agencies such as the World Bank,

International Monetary Fund (IMF), and the United Nations

World Trade Organisation take decisions that are binding on

countries. This has eroded Africas sovereignty and power

8. Loss of culture identity and moral standards: Africa has an

amazing conglomeration of cultures, languages and tribes

spread across its 53 countries and 7 dependent territories

(World Bank, 2009). As cultures interact, some cultures are

being diluted and/or destroyed at the expense of others andnegative values are being spread all over the world with relative

ease


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Drawbacks Cntd.9. Crime: Globalization has encouraged illicit trade in drugs,

prostitution, pornography, human smuggling among other

evils

10. Brain drain: Globalization has facilitated the brain drain indeveloping countries, thus reducing further their human

capacity (Nsibambi, 2001). About 70,000 professionals and

university graduates are thought to leave Africa each year to

take up work in Europe or North America (Weiss, 2001). This

undermines the efforts to build national capabilities anddrains Africas already meagre supply of skilled workers

(Saleh, 2010).


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Factors Contributing to the Negative

Impact of GlobalizationA. BAD POLICY.Trade and investment flows to

countries are impeded by poor

macroeconomic policy that leads to chronically

large fiscal deficits, which creates instability.

Investors, as well as exporters, are also

discouraged by policies that lead to an

overvalued currency, and by policies thatoverprotect local producers for long periods,


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Factors Contributing contd.B. BAD TERMS.The responsibility for the limited or

negative benefits of globalization cannot all be laid on

the shoulders of the developing country governments.

The terms under which trade and finance take placeoften are very unfavorable. Between 1980 and 1990,

for example, real commodity prices fell by 45%, as a

result of which developing countries as a whole

suffered cumulative terms-of-trade losses amountingto US$291 billion.


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Factors Contributing contd.C. BAD RULES. the rules of the game are stacked against

developing countries, and the Uruguay Round (UR), which

created the rules-based World Trade Organization, has not

changed the situation very much. Most of the protection forindustry and agriculture in industrial countries was left intact.

Part of the dissatisfaction with the WTO is the perception that

the issues it addresses are those which concern the

developed countries, brushing aside those of interest to the

developing world. Moreover, there remains a very large scopefor evading the spirit, if not the letter of the UR agreements.


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Tourism Development Tourism development involves broadening the

ownership base such that more people benefit

from the tourism industry, skills development,

job and wealth creation and ensuring the

geographic spread of the industry throughout a

country.

It also refers to all the activities associates with

providing facilities for tourists in host area,


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Challenges that Globalization can contend to Tourism Development inEthiopia Transnational corporations

Travel and tourism has emerged as one of the world's most centralized

and competitive industries, and hardly any other economic sector

illustrates so clearly the global reach of transnational corporations

(TNCs).

Economic Globalization

The increasing role of international financial and commerce bodies,

which came as the erosion of power of governments due to the recent

crisis, compels local government to bow to their rules and conditions.

Governments potentially ours too could be dragged to their

requirements (like IMF, WTOs, WB) which intern to be the TNCs

interest to dominate new market.


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Challenges that Globalization contd Social and Cultural Problems

Uncontrolled and un-managed tourists boom

may also result in an upsurge of crime,

prostitution, drug abuse, instability, Terrorism

and other social and environmental vices

related to tourism.


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Way Forward

As it is clear now that continuing the status quo and letting

the trend to marginalizing would increase human insecurity

and vulnerability and judging from the increasing volume of

protests heard, this alternative is becoming more and moreunacceptable.

Therefore:-

The Ethiopian government should ponder thoroughly before

considering to join WTO as it would mean to accept free trade

rules over its main priorities and as critic said the

organization (WTO) completely dominated by industrialized

countries


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Way Forward.. contd

Again the government should be prepared to deal with the

problem at national, regional and global level

At National level: appropriate economic and social

policies to capture global opportunities, trade, capitalflows and to protect people against the vulnerabilities

the Globalization creates

Regional and Global level: actions to tackle crime,

disease, terrorism, environmental degradation, reverse

the marginalization of poor, remedy in the imbalances in

the structure of global governance


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THANK YOU

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