The implementation of globalization has not been without its major flaws. Abolishing it, however, is paramount to anti-socialist behaviour or looking inwards – a concept that is utterly against the tendencies of human nature.
If you read up on any definition of globalization , you will observe that the intention was always one of a genuine need to integrate and collaborate for the mutual benefit of nations.
It can, however, like any product (including knowledge), can be exploited out of selfish desires and lead to heavy exploitation.
Of course, it also doesn’t mean that globalization must apply to every sector of an economy. Some inward investment is always healthy. It should, however, not lead to extreme nationalism for a fear of loss of national identity.
The problem, like many others, lies in the hands of politicians who are controlled and dictated to by a handful of large corporations. These ‘corps’ have one and only self-interest – profit, power, and control.
The main concern for sovereign governments is that ‘giving up’ or sharing one’s technological, innovative or manufacturing secrets to other countries would make them ‘vulnerable’.
The real issue lies in a lack of trust – leading to the notion: “I will not let you know how I do it because you may use it against me – in trade or war”.
Despite the existence of supposedly ‘compartmentalised’ trading blocs and free trade areas such as NAFTA, EU, ECOWAS, SADC etc, the rate of globalization has sped up significantly in the past decade.
This is due to boundless advances in information technology as accurately predicted by Neoclassical Growth Theory.
Information technology has now given us, investors, and businesses of all economic class, race, and gender, valuable new tools to identify and engage in economic activity.
Tech provides access to and faster, more informed analysis of information, transfers of assets, and collaboration.
The impact on finance
In the financial sector, a globalized world means that with the aid of technology, one can buy and sell shares of an Italian pharmaceutical firm from a desktop in Namibia!
You would then only have to deal with the commissions and transaction fees (including capital gains tax) locally pertaining to your online trades.
And think about it, on a micro-level. If globalization is entirely a bad concept then no-one should be using Amazon, eating MacDonalds or watching Netflix in protest. Hard to imagine, isn’t it?
We must praise its positive outcomes and work hard against the negative impacts – which are also giving rise to a new era of extreme nationalism or populism.
You can only do your bit by promoting and backing policy-makers that can enforce good trade laws. This would force both local and international competitors to play by the same rules.
The penalties for financial misconduct should be a lot greater to deter exploitation and not simply give perpetrators the proverbial slap on the wrist.
The creative destruction of the financial system will be fostered by the advent of the cryptocurrency and its underlying blockchain technology.
Depending on its uptake, and whether the authorities can legitimise its legality, we may have both individuals and governments using decentralized currencies to engage in trade.
The Venezuelan president for one, is investigating the concept of a national cryptocurrency dubbed ´Petro´ to use for trading and to alleviate dependency on (heavily interest-ridden) loans.