Globalization

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BUSINESS COMMUNICATION AND GLOBALIZATION

Table of Content
Table of Content

ITEMS| PAGE|
Definition of globalization| 1|
History of globalization| 1|
Implication of globalization towards international business environment| 2 - 3| Main features of legal and political environment| 4 - 5|
Sectors in Foreign Direct Investment (FDI)| 6|
Motivations and obstacles of globalization| 7 - 8|
Perspectives of globalization| 9|

Definition
Definition

Globalization can be described as the growing integration of the world’s economy. Or in other word, it is an ongoing process in which regional economies, society and cultures become integrated with and interdependent on one another. It is advocated that economic decision taken in one part of the world will affect other parts of the world. Therefore, businesses need to base their business decision-making on what is happening around the world market rather than the national market. History and Phases

History and Phases

Early Stage
Early form of globalization is cause by the trade links between the Roman Empire, the Parthian empire and the Han Dynasty. The growing articulation of commercial links between these powers has inspired the development of Silk Road. Adding to that, the Islamic Golden Age was also an important phase of development of globalization. This is said so because Muslim traders and explorers sustained economy across Old World resulting in globalization of trade, knowledge, crops, and technology. Cosmopolitan culture created when it is a necessity to learn Arabic and completing the Hajj. Mongol Empire establishment have allowed travelers and missionaries to travel from one end of Eurasia to the other, for an example, Marco Polo. This has brought to the creation of first international postal service and rapid transmission of disease outbreaks in the regions of Central Asia. Globalization became a business phenomenon in the seventeenth century when the British East India Company (EIC) founded. It is said that EIC was the first multinational corporation. This was followed by the establishment of the Dutch East India Company in 1602 and Portuguese East India Company in 1628. The final phase of globalization came during the gold standard crises and Great Depression in the late 1920s and early 1930s. Modern Globalization

Politicians wanted to break down borders that hampered trade and to increase wealth and interdependence globally and also to decrease the possibility of war after the World War II. Their work led to the Bretton Woods conference. It is an agreement by world’s leading politicians to lay down the international commerce and finance framework. It is also the beginning of institutions like the International Bank for Reconstruction and Development also known as the World Bank and the International Monetary Fund (IMF). Globalization has reduced the costs of trade and by negotiation rounds. It is held under General Agreement on Tariffs and Trade (GATT) and World Trade Organization (WTO). These resulted in series of agreements to remove restrictions on free trade and lower the barriers of international trade.

Implication of Globalization
Implication of Globalization

Globalization has brought a great impact on the international business environment. Some impact would bring good to the companies, but some would too bring bad to the companies. Most of the time, companies that are affected by globalization is multinational corporations (MNCs). Industrial

Globalization has resulted in the emergence of global common market and broader access to a range of foreign products for consumers and industries. It also increases the movement of materials and goods inside and outside national boundaries. For example, Malaysians could find various products from China and Bangladesh especially in the retail line. Movements of materials increases meaning raw materials such as silk would come from China, being transported around the...
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