Trends associated with globalization

· Increase in international trade at a faster rate than the growth in the world economy.

· Increase in international flow of capital including foreign direct investment.

· Increase in world production and output and consumption.

· Greater trans-border data flow, using such technologies as the Internet, communication satellites, and telephones.

· The push by many advocates for an international criminal court and international justice movements (see the ICC and ICJ respectively).

· Greater international cultural exchange, for example through the export of Hollywood and Bollywood movies.

· Some argue that terrorism has undergone globalization through its use of global financial markets and global communication infrastructure.

· Spreading of multiculturalism and increased individual access to cultural diversity, with on the other hand, reduction in diversity through assimilation, hybridization, Westernization, Americanization of cultures.

· Erosion of national sovereignty and national borders through international agreements leading to organizations like the WTO, OPEC, and EU.

· Greater international travel and tourism.

· Greater immigration, including illegal immigration.

· Development of global telecommunications infrastructure.

· Development of global financial systems.

· Increase in the share of the world economy controlled by multinational corporations.

· Increased role of international organizations such as WTO, UN, IMF that deal with international transactions.

· Increase in the number of standards applied globally, for example, copyright laws.

· Regional economic integration (regionalism).

· Economic integration is concerned with the removal of trade barriers or impediments between at least two participating nations and the establishment of cooperation and coordination between them. Economic integration helps steer the world toward globalization. Globalization refers to the growing economic interdependencies of countries worldwide through the increasing volume and variety of cross-border transactions in goods and services and of international capital flows, as well as through the rapid and widespread diffusion of technology and information.

· The following forms of economic integration are often implemented.

· Free Trade Area: Involves country combination, where the member nations remove all trade impediments among themselves but retain their freedom concerning their policy making vis-à-vis non-member countries. The Latin American Free Trade Area, or LAFTA, and the North American Free Trade Agreement, or NAFTA are examples of this form.

· Customs Union: Similar to a free trade area except that member nations must conduct and pursue common external commercial relations such as common tariff policies on imports from non-member nations. The Central American Common Market (CACM) and the Caribbean Community and Common Market (CARICOM) are examples of this form.

· Common Market: A particular customs union that allows not only free trade of products and services but also free mobility of production factors (capital, labor, technology) across national member borders. The Southern Common Market Treaty (MERCOSUR) is an example of this form.

· Economic Union: A particular common market involving the unification of monetary and fiscal policies. Participants introduce a central authority to exercise control over these matters so that member nations virtually become an enlarged single “country” in an economic sense.

· Political Union: Requires the participating nations to become literally one nation in both an economic and political sense. This union involves the establishment of a common parliament and other political institutions.

· Along with the above sequence from 1 to 5, the degree of economic integration increases. One form may shift to another over time if all the participating nations agree. For example, the European Union (EU) started as a common market and shifted over the years to an economic union and now to a partially political union.

· The above forms reflect economic integration between or among nations within a region. Global economic integration also occurs through “multilateral cooperation” in which participating nations are bound by rules, principles, or responsibilities stipulated in commonly agreed upon agreements. Unlike the preceding five forms that all lead to regional economic integration, multilateral agreements are largely used to promote worldwide economic exchanges. They may be designed to govern general trade, service, and investments (for example, the World Trade Organization), capital flow and financial stability (for example, the World Bank and the International Monetary Fund), or specific areas of trade, such as dealing with particular commodities (for example, the International Coffee Agreement).

· International economic integration is propelled by three levels of cooperation: Global, regional, and commodity. Global-level cooperation occurs mainly through international economic agreements or organizations (for example, WTO); regional-level cooperation proceeds through common markets or unions (for example, NAFTA); and commodity-level cooperation proceeds through multilateral commodity cartels or agreements (for example, OPEC).

· Barriers to international trade and investment have been considerably lowered since World War II at the multilateral level through international agreements such as the General Agreement on Tariffs and Trade (GATT). Particular initiatives, carried out as a result of GATT and the WTO, for which GATT is the foundation, have included.