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How Do We Respond to Tensions Arising From Some Economic Impacts of…
How Do We Respond to Tensions Arising From Some Economic Impacts of Globalization?
Economic Impacts on Countries
Economic Growth
Infrastructural Developments
Establishment of the Jurong Industrial Estate
Greater Diversity of Goods for Consumption
Development of Biomedical Science Industry
Free Trade Agreements
Increased Tax Revenue and Business Oppurtunities
Foreign Direct Investments
Challenges
Competition with local companies
Limited Employment Opportunities for Locals
Unsubstantial Transfer Of Knowledge and Skills from Foreign Companies or Investors
Economic Downfall
Countries withdraw investment or reduce demands of goods and services from other countries
less income and employment for countries affected
2008 Global Financial Crisis
Economic Impacts on Companies
Higher profit / Market share
set up MNCs operations in different locations
allow access to new markets abroad
access to lower labour costs and cheaper resources (i.e. land & raw materials)
MNCs obtain components from one location
EXAMPLES: American MNCs, PepsiCo
Lower Profit / Market share
introduce new features into its products and services
SMEs (small and medium enterprises)
challenges faced: shortage of labour and expertise, small domestic market, insufficient profit,competition from big companies
contribute to more than 50 % of economic output and 70% of employment
MMI Holdings: supplier of hard drive disks for US-based Seagate Technology
Incentives offered by SG government
provides various forms of financial assistance to help SMEs at different stages of growth
aids in SMEs' efforts to venture abroad
facilities partnerships between SMEs and larger corporations
provides financial assistance in the form of loans, grants and tax incentives
Economic Impacts on individuals
Higher incomes
facilitated mobility, encourage the movement of looking for better jobs
Loss of income
can be experienced by anyone (lowly / highly skilled)
unable to equip with skills required
companies who have more access to foreign market offers lower labour costs
eg: 2013 Uniqlo moved out of China into Vietnam where labour coasts were half that of China's.