International

Globalization – A Paradox

Globalization, or in simple terms as we understand the world turning into a global village, refers to the process of interaction and integration among the people, companies, and governments of different countries through international trade and investment supported by the advancements in information and technology. The term globalization has its origins in the management literature of the early 1980s. It was coined by a Harvard Business School professor Theodore Levitt in a Harvard Business Review article in 1983 titled ‘Globalization of Markets.’ While writing about this phenomenon, he pointed out the need for multinational corporations to make changes in their manufacturing techniques and their sales strategies, adjusting to local social behaviors and cultural preferences, to be able to sell their products worldwide. This practice has turned into a ritual, the effects of which can be seen all around today. For example, a visit to a nearby shopping complex would make one realize that all the products which are displayed have come from some other place around the world. It makes one feel that producers from around the world have come up to his doorstep to offer humongous choices to buy products from for consumption and survival.

Globalization affects not just economic development but also the environment, culture, political systems, and a human’s physical well-being in societies. Many writers interpret globalization as a renewal of the enclosure movement that occurred during the early phase of agricultural capitalism in Great Britain. Karl Marx then had deciphered the enclosure movement in England as a necessary precondition for the rise of industrial capitalism. ‘Improving’ landlords eliminated the rights and privileges of peasant tenants through force and law, turning agriculture into a market-driven process, which ensured profit through surplus production. Thousands of peasants became vagabonds who first housed in poor houses and then served as the reserve army of labor as industrialization began to take a foothold (Wood 1999).

Scholars like George Caffentzis, Iain Boal, Silvia Federici, and others have argued that the contemporary capitalist project of globalization is a continuation of the English enclosure movement. It aims at bringing the still traditional areas of the world into the global marketplace, thus, eliminating commons worldwide (Boal 2007; Federici 2001). David Harvey (2003) calls this process ‘accumulation by dispossession.’

Globalization is not a new process, though. For thousands of years, people and then later corporations have been interacting in a marketplace environment for buying and selling through routes like the Silk Route that connected China to Europe during the Middle Ages. These interactions further gained momentum through advancements in information and technology. But like every system, globalization also comes with its demerits. Globalization, though as the means to bring the developing or Third World countries as an equal with the developed world, is being perceived as exploiting the labor markets of these countries, especially the women workforce.

Globalization and Women in Emerging Economies

Globalization in the developed world resulted in a dramatic cut in the high paid manufacturing jobs and the establishment of a low-wage service economy. The tax structure has been skewed to benefit the very rich and thus, leading to increasing inequalities, affecting even countries like the United States, and the rest of the world. With the decline of unions, a “flexible” workforce consisting of part-time, contract employees has emerged heading towards the establishment of an economy where some one-quarter of workers are earning poverty wages.

Globalization has turned the Third World countries (most of which are referred to as emerging economies of late) into export-oriented manufacturing industries, majorly comprising of the women labor force. Since 1980s, women who traditionally worked in agriculture began to work as industry waged workers at the dawn of globalization. Many feminist scholars, unlike other scholars, who believed that this was a route for women to get integrated into the development process argued that it was capitalization happening over comparative advantage of women’s disadvantage. Due to factors like the seasonality of demand, and stiff international competition, labor-intensive industries like clothing require unskilled, cheap, flexible labor force, that is, can be hired or dismissed easily. Women easily fit into these parameters and thus get exploited.

In the rapidly increasing literature on globalization, only a limited number of studies have focused on the centrality of women’s labor. From a critical lens, globalization has led to the impoverishment of many hundreds of millions of people. The macroeconomic changes adopted by the emerging economies to tackle their debts have endangered their economic sovereignty, with very few restrictions on international corporations who are seeking a cheap and submissive labor force to cut down their wage costs.

Subcontracting to Emerging Economies

Recent years have witnessed the emergence of the phenomenon known as the intra-product trade. It means that the manufacturing of a product is amenable to fragmentation. This concept of fragmentation, also known as subcontracting, dates back to the times of the industrial revolution. Subcontracting has emerged as one of the new patterns of the world economy.

The emerging economies have transformed into export-oriented manufacturing industries due to subcontractng being practiced by the corporations of the developed countries. The big corporations, who intend to lower down on their costs of large orders, contract their orders to an agent or a company in the emerging economies, which further subcontract the orders to subagents. The subagents might further subcontract the orders. These ongoing events give birth to a vicious supply chain, which tends to become more and more complex.

Global Capitalism – Inroads into the Emerging Economies

How did these big multinational corporations get to enter into the emerging nations to find cheap labor for their production process has two interlinked elements to it. Firstly, it is through the penetration of foreign capital into the these economies and secondly, the reduction of state-led development efforts in them. There is a big difference between state-led development and neo-liberal “open door” development. The first, ideally, not only use “massive capital-intensive, state-directed investments to build industries” but also mounts an assault on the structures of inequality, such as concentrated land ownership that systematically deprive the poor of resources to escape the poverty (Bello 2006, 1). The second pushes the economy into a depression and then selectively “develops” only those areas of the economy that are useful to generate export earnings, such as the production of electronic components. Thus, setting up of export processing zones (EPZs) facilitates this kind of development in emerging nations. EPZs allow multinational companies with highly favorable conditions like a large women workforce. There are vast differences between these two policies. For example, in Mexico, there has been a gender shift from male to female labor because of the aid provided to export-led maquiladora production.

On the other hand, the phenomenon of Structural Adjustment Programs (SAPs) has impoverished most people, especially women and children. SAPs lead to the reduction or elimination of free education, healthcare, and water that becomes a burden on women, especially in peasant economies like in many parts of Africa. In addition, women have been thrown back into the informal economy due to severe government job cuts. In the face of increasing pressures from SAP regimes, women have adopted various strategies. These include working in EPZs, engaging in sex work, using microcredit, migrating to explore work, etc.

Export-Processing Zones (EPZs)

One option, at least for young women, has been the opportunity to work in EPZs, whose antilabor structures assure foreign investors a mainly docile female workforce. Indeed, Alice Amsden argues that the male-female gender wage gap was one of the keys to the success of South Korea’s industrialization. In the electronics industry, shortly after the invention of the silicon chip in 1958-1959, Fairchild opened the first offshore semiconductor plant in Hong Kong, the company moved into South Korea in 1966. General Instruments moved its microelectronics production to Taiwan in 1964. In 1965, many high-tech firms moved their production to the U.S.-Mexico border, opening the first maquiladoras. In the next decade, Singapore, Malaysia, and the Philippines followed suit, and in the late 1970s, they were joined by countries in the Caribbean and South America (Fernandez-Kelly 1989). In addition to high-tech production for computer parts, multinationals producing a wide range of goods shifted factories overseas, lured by government advertisements for the “nimble fingers” of their women workers (Froebel, Heinrichs, and Kreye 1980, 322ff.).

As information about the inhumane conditions experienced by women in these factories became widely known, there was widespread publicity about the return of sweatshop conditions around the world. Indeed, Naomi Klein argues that the global justice movement owed its origins in part to indignation over the conditions imposed by well-known brand name multinational corporations, such as Nike, on their workers (Klein 2000, 326fF.; Pollin 2003, 153-163).

There has been widespread debate over the advantages and disadvantages of EPZs ( Pyle and Ward 2003,471). Some feminist scholars, such as Patricia Fernandez-Kelly (1983), have condemned the extreme exploitation of female workers. But others, such as Linda Lim and Naila Kabeer, have defended EPZs as a path for women to escape familial patriarchy, or as a way for women to earn incomes that exceed what they could get in domestic industries (Lim 1990; Kabeer 2000). Thus, in her work on Japanese electronic companies in Malaysia, Aihwa Ong points out that the village girls they hired might be exploited workers, fired as soon as their keen young eyesight began to require the use of eyeglasses. But they were also being modernized, abandoning the peasant sarongs of their villages for blue jeans, and winning the right to choose their own husbands (Ong 1987; Beneria 2003, 77-78).

Diane Wolf notes the paradox for women workers: “Globalization is a double-edged process as far as women are concerned. On the one hand, employment opportunities derived from transformations in the global economy produce new kinds of patriarchal and capitalist controls over women” (Fernandez-Kelly and Wolf 2001, 1246). But on the other hand, the low-wage jobs, which are “often below subsistence standards,” nonetheless give women “tools with which they [resist] patriarchy…. Women I interviewed [in Java, Indonesia] preferred work in ‘global sweatshops’ to the village rice fields” (Fernandez-Kelly and Wolf 2001, 1246).

Conditions in EPZs vary from country to country. But nearly all are exempt from national labor laws, and employers are ruthless in opposing any labor organizing. A report by the International Confederation of Free Trade Unions, which included case studies of Bangladesh, China, the Dominican Republic, Haiti, Honduras, Madagascar, Mauritius, Mexico, and Sri Lanka, documented the extensive efforts of EPZs to keep unions out and to go after labor organizers. (The exceptions were Honduras and Sri Lanka, where, after considerable pressure from international labor organizations, there have been some successful attempts to establish unions in EPZs [Perman et al. 2004].)

Conclusion

As Nestor Kirchner says, we must create a kind of globalization that works for everyone and not just for few. Thus, states should design and implement development models that promote inclusive growth and development across the globe. Models of development should not be skewed, gender-biased, and benefiting few.

-Anmol Dhaliwal (One of the Prize Winners of Article Writing Competition 2020 in the 25-44 Years Age Group)

Picture Credits: youmatter.world



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