The Concept and Aspects of Globalization

Globalization is a result of man's progressive nature of change. It can be traced far back from the 16th century — the period when European traders and sailors engaged in overseas trade through mercantilism. From the 16th century onwards, the Europeans and Americans transformed the shape of global migration.

1. Advances in Science and Technology. The development of science and technology has contributed greatly to the development of global interconnectedness, interactivity and the integration of the world societies into a single global village. Through science and technology, machines, which simplify human activities like communication, have been developed.
2. Socio – political liberalization. Liberalization was derived from the liberal democratic principle. Liberalists believed that the freedom of an individual is the main principle of life that people are supposed to have. The freedom of individual has fostered the development of globalization in the world. Social liberalization is widespread due to the advancement of information and communication technologies like television, e-mail, cellular phones and the internet.

1. Information and Communication Technology. Globalization is characterized by the advancement of information and communication technology. This period witnessed the global distribution of media images through computers, screens, radio, newspapers, televisions and mobile phones.
2. Movement of People. There has been an increase in the movement of people from one country to another. These may be tourists, migrants, refugees, business travelers and diplomats.
3. Spread of Ideas and Ideology. Spread of knowledge, ideas, information and ideologies has been an integral aspect of globalization. This may be different physical capital, technical skills and production methods, managerial skills, marketing skills and global economic policies.
4. Finance. There is a global flow of money often driven by the interconnected currency market stock exchange, as well as commodity markets.
5. The Rise of Intellectual Property. This refers to items including patents, copyrighted movies, compacts discs, advertisements and financial services.
6. Free Market Economy. Globalization has brought about the integration of an international political economy through inter-financial institution policies and international trade.
7. The Structural Adjustment Program (SAP). SAP refers to the list of budgetary and policy changes required by the International Monetary Fund (IMF) and World Bank (WB) for developing countries to qualify and apply for a loan. These conditions typically include reducing barriers to trade and capital flows, tax increases and cuts in government expenditure. All sub-Saharan African countries south of the Sahara

1. To introduce tax reforms and eliminate quantitative restrictions in the trade sector.
2. To rationalize the public sector and enhance employment opportunities.
3. To improve the public investment program.
4. To introduce agricultural sector reforms, market liberalization and institutional reform.
5. To improve sectoral resource allocations, mobilize domestic resources and restore growth of the economy.
6. To devalue local currency as a means of monitoring exchange rates and therefore balance the domestic currency price.
7. To reduce poverty by improving the living standards of people in lesser-developed countries.

1. Elimination of tariffs, reduction of taxes and promotion of the role of private operation in export trade, as well as liberation of domestic retail and whole world sale trade (in final goods and capital).
2. Lowering explicit and implicit taxes on the agricultural sector, raising real producer prices while reducing subsistence taxes on imports and liberalization of export crop marketing.
3. Removing restrictions on collective reforms and wage setting practices in order to attain better life of people.
4. Parastatal privatization and reform programs, financial sector reforms, and improving public sector management through civil service reforms, all intended to consolidate and ensure effective performance in trade sales and joint ventures.
5. Governments to withdraw from providing free education and agricultural incentives. Instead, cost sharing to be implanted in all social services.
6. The agricultural sector to be privatized to minimize government expenditures on it.

1. The formation of adjustment programs and policies with the intention of economic sustainability, efficiency and growth has raised the living standards of people in their respective countries through the privatization policy.
2. Agricultural productions, exports, investments and consumption witnessed increases in strong reformed countries.
3. The invest performance improved mostly in strong reforms, while it went up slowly in non-reforming countries, in years between 1980–1984 and 1985–1987.
4. The increase in the growth rates on real consumptions in 1986 and 1987 compared to 1980–1984, has been three times as great in reforming countries.
5. Politically, SAP has made many third world countries democratic. Among SAP conditions, good governance is insisted. Therefore, people have freedom of speech, decision making and accountable in their development.

1. SAP has failed to implement most of its objectives and principles to the developing countries and instead it accelerated the rate of poverty in rural areas. This has come about due to the fall of the agricultural sector, which acts as the backbone of most developing countries.
2. Economic diversification is still low due to instability of economies in which the capital earned per year tends to be directed in different socio-economic issues.
3. Export capital and investment capital ratio still low in developing countries, especially in Sub-Saharan African countries.
4. Agricultural and industrial products are still unsatisfactorily produced due to improper investment and inadequate technology.
5. SAP has destructed local industries. This is due to the border-less policy, which allows regional and international companies to pour their commodities into the market.
6. SAP has brought about user fee or cost sharing. This has made poor people fail to get services. For example, user fees have made people fail to get medication at hospitals.

1. State interventions: The state should act with regulatory framework. It should not control but where possible should intervene
2. Priorities and preferences in privatization: The government should have priorities on what to privatize and why. Otherwise, privatize everything can lead to lack of sovereignty and imbalance in market; which in turn lead to failure of poor Tanzanians fail to get basic needs. This can be dangerous for the betterment if national security and development.
3. Human capital should be developed: More schools offering sound and appropriate education should be established. The curriculum should reflect SAP needs.
4. Effective tax collection: With SAP conditionality's, the government provides investors with tax holidays. Many investors have started making some manipulation of changing the names and ownership of the investment.
5. Local or internal industries should be provided with subsides: This will make the local industries to complete in the market. Also, Low Developed Countries (LDC's) should implement their integrations.