Globalisation pt1

Created by: chloesplyons
Created on: 16-03-23 13:59

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Growing economies
- Where, why and how, UK compared to emerging economies
  - More enterprising behaviour from local businesses
  - More stable government
  - More willingness to accept investment
  - Easier access to export - improvements to communication & transport
- Effects of economic growth for businesses
  - Offshoring - Moving a business function to another country
    - Goal is to exploit lower production costs which increases profit margins
  - Export opportunities - New markets in growing countries/economies.
    - The UK is good at: Fashion design, Engineering & architecture, Culture, financial services
  - Increased domestic competition
- Growth indicators
  - GDP per capita
  - Literacy
  - Health
  - Human development index (HDI)
China VS India
- India
  - Poor infrastructure
  - Narrow education system
  - Balance of payments deficit
    - High inflation rates
    - Deficit of $9.7 billion
    - Indian consumers buying more imports than domestic products
  - Lots of English speakers in India
    - Allows for call centres and easy communication with other countries
  - Faster growing Young population
- China
  - Lots of investment on construction and infrastructure
    - Coming from government spending and FDI
      - FDI from western countries building factories in China
  - Huge population
  - HIgh levels of economic growth
  - With economic growth comes wage rates risiing
    - China is appealing to many countries because of the low wage costs
  - High emissions, china has only just started taking global emissions seriously and they are a big cause
    - New legislation will come into play which could slow their growth as manufacturers
Fixed capital formation - Investment in long term assets e.g. roads and buildings

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Globalisation pt1

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