The growth of global competition, a change in its nature, the impact of globalization on the world economy - International Economics

The growth of global competition, a change in its nature

Under the influence of globalization competition is increasing.

It should be emphasized that competition is increasing unevenly geographically and by sector. Competition in domestic markets pushes capital, goods, resources to foreign markets.

With the elimination of protectionist barriers, competition has poured into spheres and branches of the world economy, previously protected from external competition by barriers, as a result of which the world market turns into a communicating vessel.

Another major consequence of globalization is changing the nature of competition . Competition as a result of the imbalance between the main actors of the competitive environment (states, international organizations, transnational corporations, small producers) acquires the character geo-economic competition .

There is a constant redistribution of spheres of influence. The main form of the struggle is the emphasis on technological advantage and lobbying of favorable rules and conditions for activities through the world economic organizations, the governments of developed countries in a dialogue with the governments of developing countries. Hence the growing activity of international economic organizations aimed primarily at further lifting the barriers.

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In this situation, most developing countries are forced to accept the "rules of the game", which are not always and not in all favorable for them.

In general, developing countries are deprived of the main incentive for globalization - the "diffusion" effect. economic activity, technology, experience in organizing work, developing human potential.

With the appearance in the world economic arena of such powerful new actors as TNCs and international organizations, the struggle unfolds not only between states but states and new actors. The struggle is tied up both for the domestic market and for the share in the world market as a source of jobs and new incomes. Combined with limited resources, low competitiveness of developing countries, environmental constraints, this has led to the fact that now the struggle is unfolding not only for the efficiency of production, but also for the very right to manufacture as the basis for the existence and security of the country.

To understand the phenomenon of globalization, it is necessary to analyze its various aspects in the following areas:

- the processes taking place in the global economy, and the general problems of the world economy generated by globalization;

- the processes initiated by globalization in certain strange worlds, and the problems that arise in the country;

- change in the activities of firms engaged in international business;

- the impact of globalization on the socio-economic development of man and family.

The Impact of Globalization on the World Economy

The impact of globalization on the world economy is expressed:

- in increasing the total world volume of exports of goods and services;

- an increase in the total global volume of foreign investment;

- the development of world markets for currency and capital, continuous operations at a distance and in real time

- the development of new means of communication - the Internet, cell phones, information networks.

- the movement of huge amounts of speculative capital that can not be predicted;

- activation of the activities of international financial and economic organizations (IMF, World Bank Group, World Chamber of Commerce, WTO, etc.)

- the development of the process of regional integration in the global economy.

Previously, international economic relations developed mainly within the framework of the colonial empires (British, French, German, Dutch) that had formed by that time, and only then between the metropolises themselves.

Modern processes of globalization are developing primarily between industrialized countries and only secondarily the current developing countries (in the past, for the most part colonial possessions) are taking over.

The main form of internationalization of economic life for a long time was international trade, or rather, trade between metropolitan countries and colonies in the form of the exchange of finished goods for colonial agricultural commodities.

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The main directions and the composition of international trade have changed significantly: the predominant place was taken by the trade turnover between the developed countries themselves, and its commodity content is made up of machinery, equipment, science-intensive, high-tech items and other finished products. In terms of its content, this is mainly not an interbranch, but an intra-industry trade based on the intra-industry specialization of individual countries.

Especially important is the growth in trade in services, including financial, legal, management, information. If in 1970, with the export of services, less than one-third of foreign direct investment was associated, by now this share has increased to 50%, while intellectual capital has become the most important on the world market.

As for foreign direct investment, their growth exceeds the rate of growth in international trade, in which the trade in services, technologies, intellectual property increases at a faster pace.

Both the export and import of these investments are usually connected with domestic investment activity necessary for servicing foreign (especially mixed) companies in the country, as well as with the activities of their own companies abroad.

A completely new phenomenon, characteristic of the modern processes of globalization, is the formation and progressive growth of financial markets (currency, stock, credit), which have a tremendous impact on the whole sphere of production and trade in the world economy.

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