Globalization & its Significance

The people of the world, societies and economies are integrating as the distances are shrinking and fast means of communications are making the movement of people, goods, capital, information and knowledge much easier. The geographical boundaries are no obstacle. With this, the capability to influence each other is also increasing. As the globalization encompasses all spheres of life, politics, economics, technology, education, media and culture so is its capability to influence human life. The economy, however, occupies the most significant position in these areas. It has an overriding effect to all spheres of life as well as a motivating force behind the whole process of globalization.

Even in global institutions like United Nations, World Bank and IMF role of a particular country and power to make and influence decisions depends upon the financial contribution that country makes. And within societies and nations, it is not possible for an individual or a party without plenty of capital to assume a position of leadership and to sustain it. Technology and its development, related to all the fields of life also needs a lot of money. As such it is the economically powerful individuals and groups in the economically powerful countries who have the key role in influencing the decision making both within their own countries and at the global level, be it politics, conflicts and wars or development in social sectors like education and health services. In today’s globalization therefore the capital has assumed the greatest importance giving major role to as well as creating stakes for those having the large amounts of capital. The capitalist are also the main beneficiaries in the process.

There is no doubt that leaving aside some of the richest countries in the world MNCs own most of the world capital and therefore are the main players in the global economy. And since these MNCs mostly belong to the same rich countries of the world there is no major conflict of interest among them rather they reinforce each other in protecting their mutual interests thus bringing in harmony in economic, political and social and cultural agenda being pursued under globalization. G8 meetings set the agenda while World Economic Forum provides an opportunity to the MNCs and the world leadership to interact and develop initiatives to make the agenda operational. Thus the main force behind the present day globalization is the market (economy). It is important in this context to review the role of MNCs and TNCs as they are the most important vehicles of the market economy particularly when the globalization has reduced the distances and the technological advances have expanded the market opportunities to the whole globe. They are the catalyst behind both the process of globalization and the market economy; they get the maximum benefits out of the process; and their stakes are the highest in maintaining the present trend of globalization.

Khalid Rahman

Source: Essays on Muslims and the Challenges of Globalisation, Institute of Policy Studies, Islamabad. Republished with permission.