Contemporary World

Globalization -The intensification of all the interactions (economic, political, social) among the
different actors in the international system

*PERSPECTIVES ON GLOBALIZATION

Hyperglobalist

• Purely Economic

• Positive Effects of Globalization

Skeptics

• Not ‘Globalization’

• Americanization or Westernization

• Negative Effects of Globalization

Transformationalist

• Globalization had both positive and negative effects

*MEANS TO ACHIEVED GLOBALIZATION

1. Liberalization of Trading Policies

2. Foreign Direct Investment

3. Privatization

4. Presence of Multinational Companies

5. Contractualization

World Economy in the Post War Era

➢ War between the Allied Powers (USA, Britain, France, and USSR) and the Axis Powers (Germany,
Italy, and Japan)

➢ REASON: Political (World Domination) and Economic (Resources)

➢ Allied powers win in 1945

➢ Devastation after the war = Developmental problems

➢ The need for global cooperation for development

➢ Establishment of International Institutions due to the intensified relationships among the
different members of the community (Globalization)

➢ Focus on Economic Globalization

➢ Establishment of the Holy Trinity of the Global Economy (for the critiques, they are called the
Unholy Trinity)

Bretton Wood Conference

➢ 1944 – Bretton Woods, New Hampshire; 44 delegates

➢ GOLD STANDARD based on US Dollars

➢ Adjustable-peg exchange rate system

Foundation of Global Financial Institution

➢ Created the International Bank of Reconstruction and Development (IBRD) – now known as the
World Bank – and the International Monetary Fund (IMF)

➢ 1947 – Attempt to create an International Trade Organization (ITO)

➢ The US Congress vetoed the ITO. Alternatively, the General Agreement on Tariffs and Trade
(GATT) was created. This would later become the World Trade Organization (WTO).

Problems encountered after the Bretton Wood Conference

⮚ Cold War

⮚ 1971 – Abandonment of the Gold Standard

➢ Triffin Dilemma – international liquidity 🡪 US provides more dollars 🡨 risk in converting dollars
into gold

➢ Vietnam War, Korean War, US Deficits, Oil Crisis

➢ 1973 – Collapse of the adjustable-peg exchange rate system

➢ Adoption of floating exchange rates

➢ 1980s – Debt Crisis

The Washington Consensus

➢ The ‘experts’ in Washington decided to implement radical policy reforms to address the
problems they are experiencing.

➢ The solution was called the ‘Washington Consensus’

➢ This was the birth of ‘Neoliberal Economics’

 Recommendation of Washington Consensus

⮚ Macroeconomic Stability (Controlling Inflation and Reducing Fiscal Deficits)

⮚ Opening the Economy (Trade)

⮚ Liberalize domestic product markets (Privatization and Deregulation)

⮚ Increased role of International Organizations – particularly the World Bank and the IMF

The Current Global Economy

➢ Dominated by the principles of neoliberalism

1. Less state intervention

2. Free market economy

3. Full integration to the world economy

4. Removal of trade barriers

The Global Financial Institution

The World Bank

➢ 5 Institutions under the World Bank (worldbank.org)

1. International Bank of Reconstruction and Development – loans for middle-income and

deserving low-income countries

2. International Finance Corporation (IFC) – loans for the private sector

3. International Development Association (IDA) – interest-free loans (credits) to poorest

4. Multilateral Investment Guarantee Agency (MIGA) – encourage foreign direct investments

5. International Center for Settlement of Investment Disputes (ICSID) – conciliation and

arbitration of investment disputes

International Monetary Fund

Functions:

1. Foster global monetary cooperation

2. Secure financial stability

3. Facilitate international trade

4. Promote higher employment

5. Reduce poverty
International Monetary Fund:

MEMBERSHIP: 189 Countries

MANAGING DIRECTOR: Kristalina Georgieva (Bulgarian)

HEADQUARTERS: Washington

World Trade Organization

⮚ Formerly the General Agreement on Tariffs and Trade (GATT)

⮚ Became the WTO in 1995

⮚ Facilitation of international trade is the main goal of the WTO

⮚ Rules-based system was established

⮚ Trade Negotiations

⮚ Dispute Settlement

⮚ Implementation and Monitoring

⮚ Building Trade Capacity

⮚ MEMBERSHIP: 164 members and 24 observers

⮚ DIRECTOR-GENERAL: Ngozi Okonjo-Iweala

⮚ HEADQUARTERS: Geneva, Switzerland

The Interstate System

*Configuration of World Power

BIPOLARITY

• Two dominant powers in the world

• USA and USSR emerged as world powers after WWII

• Engaged in the COLD WAR

UNIPOLARITY

• A single world power exists (hegemon)

• USA became the sole power after the disintegration of USSR

 MULTIPOLARITY

• There are multiple world powers

• Our situation today can be described as such

• Unlike before, power is measured by economic prosperity

Types of Interaction Among States

UNILATERALISM

• Between 2 states or more

• However, only one state benefits

• EXAMPLE: US military action against Afghanistan in 2001

BILATERALISM

• Between 2 states

• Both states must benefit

• EXAMPLE: Philippine-Japanese Agreement on economic interaction

MULTILATERALISM

• Interaction among multiple states

• Should be open to everyone

• All the stakeholders involved must benefit

• EXAMPLE: The establishment of the United Nations

UNITED NATIONS

➢ Predecessor: League of Nations (after WWI in 1920)

➢ Established after WWII in 1945 (San Francisco Charter of 1945

➢ HEADQUARTERS: New York

➢ MEMBERSHIP: 193 states

➢ LEADERSHIP: António Guterres

➢ MANDATE: to end international war and promote social and economic development
 MAIN ORGANS OF UNITED NATIONS

GENERAL ASSEMBLY

⮚ Meeting of all member states

⮚ Recommendatory function only

⮚ appointing the Secretary-General on the recommendation of the Security Council

⮚ electing the non-permanent members of the Security Council

⮚ approving the UN budget

SECURITY COUNCIL

⮚ Composed of 5 permanent members (USA, Russia, France, UK, China)

⮚ 10 elected members – 2-year term

⮚ Intervention arm (international security)

⮚ Legitimate use of force

International Court of Justice

⮚ To decide legal disputes among states

⮚ Recommend sanctions

⮚ The seat of the Court is at the Peace Palace in The Hague (Netherlands).

⮚ The Court is composed of 15 judges, who are elected for terms of office of nine years by the
United Nations General Assembly and the Security Council. It is assisted by a Registry, its
administrative organ. Its official languages are English and French.

Secretariat

⮚ Composed of the Secretary-General (presides the General Assembly meeting) and Staff

⮚ Manages the general assembly

⮚ Record keeper of the sessions

⮚ The Secretariat is organized along departmental lines, with each department or office having a
distinct area of action and responsibility. Offices and departments coordinate with each other
to ensure cohesion in the UN’s programme of work.
 Trusteeship Council

• The main goals of the International Trusteeship System were to promote the advancement of
the inhabitants of Trust Territories and their progressive development towards self-
government or independence.

• The Trusteeship Council is made up of the five permanent members of the Security Council --
China, France, the Russian Federation, the United Kingdom and the United States.

EU

The common principles and values that underlie life in the EU: freedom, democracy, equality and the
rule of law, promoting peace and stability.

Austria, Belgium, Bulgaria, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland,
France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands,
Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden.

European Parliament president - Roberta Metsola

European Council president - Charles Michel

European Commission president - Ursula von der Leyen

APEC

APEC Director: Dr Rebecca Fatima Sta Maria.

United in our drive to build a dynamic and harmonious Asia-Pacific community by championing free
and open trade and investment, promoting and accelerating regional economic integration,
encouraging economic and technical cooperation, enhancing human security, and facilitating a
favorable and sustainable business environment

APEC Members

Australia; Brunei Darussalam; Canada; Chile; People's Republic of China; Hong Kong, China; Indonesia;
Japan; Republic of Korea; Malaysia; Mexico; New Zealand; Papua New Guinea; Peru; the Philippines;
the Russian Federation; Singapore; Chinese Taipei; Thailand; the United States of America;
NATO

Director- Jens Stoltenberg

NATO promotes democratic values and enables members to consult and cooperate on defense and
security-related issues to solve problems, build trust and, in the long run, prevent conflict.

ALBANIA (2009) BELGIUM (1949)

BULGARIA (2004)CANADA (1949)

CROATIA (2009) CZECHIA (1999)

DENMARK (1949) ESTONIA (2004)

FRANCE (1949) GERMANY (1955)

GREECE (1952) HUNGARY (1999)

ICELAND (1949) ITALY (1949)

LATVIA (2004) LITHUANIA (2004)

LUXEMBOURG (1949) MONTENEGRO (2017)

NETHERLANDS (1949) NORTH MACEDONIA (2020)

NORWAY (1949) POLAND (1999)

PORTUGAL (1949)

ROMANIA (2004)

SLOVAKIA (2004)

SLOVENIA (2004)

SPAIN (1982)

TÜRKIYE (1952)

THE UNITED KINGDOM (1949)

THE UNITED STATES (1949)

OPEC

Director - HE Al Ghais

To coordinate and unify the petroleum policies of its Member Countries and ensure the stabilization
of oil markets in order to secure an efficient, economic and regular supply of petroleum to consumers,
a steady income to producers and a fair return on capital for those investing in the petroleum
industry.

Republic of Iran, Iraq, Kuwait, Saudi Arabia and Venezuela are the Founder Members of the
Organization.

Qatar (1961), Indonesia (1962), Libya (1962), the United Arab Emirates (1967), Algeria (1969), Nigeria
(1971), Ecuador (1973), Gabon (1975), Angola (2007), Equatorial Guinea (2017) and Congo (2018)

WORLD DIVISION

COLD WAR

CAPITALISM, DEMOCRACY (USA) vs. COMMUNISM, AUTHORITARIANISM

Divisions: FIRST WORLD (NATO), SECOND WORLD (WARSAW PACT), THIRD WORLD (Non-aligned)

⮚ The EAST and WEST Dichotomy was created

⮚ Western countries are considered to be more advanced as compared to Eastern counterparts

⮚ The West promoting their VALUES as UNIVERSAL; the East trying to adapt these values OR
trying to resist (to find own identity)

⮚ Samuel Huntington believed that the conflicts after the Cold War are not IDEOLOGICAL but,
CULTURAL

⮚ More particularly, it will be based on RELIGIOUS BELIEFS

⮚ The September 11 attack on the World Trade Center gave this theory more credence

Global Issues

1. The climate crisis

2. Marine ecosystem deterioration

3. The hunger crisis and water scarcity

4. The hunger crisis and COVID-19

5. Health Issues