An Introduction to the Globalization Debate Essay

An Introduction to the Globalization Debate - Essay Example There are four different types and levels of economic integration. One of the most popular in the post-globalization era and generally perceived of as the first step towards eventual regionalization or the formation of a regional economic bloc is free trade agreements (Held and McGrew, 2003). As Hill (2007) clarifies, within the context of free trade agreements, all types of internal barriers to trade, or the movement of goods and services between member countries, is removed. While in FTAs member country set their own trade and economic policies with non-members, policies towards members are determined by the agreement in question. As far as the impact upon business and market relations is concerned, it is important to clarify that the said level of integration has tremendous benefits for member states and businesses within as it effectively expands the market. At the same time, competition over markets is intensified and, needless to say, if the member states in question are unequa l, this can be a disadvantage. In simpler terms, within the context of NAFTA, Mexican businesses have to compete with U.S. ones over both the regional and the domestic markets without the protection they were once afforded (within the home market) by tariffs, quotas, and subsidies. Custom Unions are a second type and level of integration. Custom union agreements replicate all of the characteristics of FTA’s but take integration one step further through the adoption of common policies towards non-member states. The European Union has its genesis in this type of integration. Taking the concept of economic integration characteristic of customs unions one step further, Common Markets allow the free movement of both labor and capital across national borders. Post-1992 EU is an example of this type of economic integration. Economic Unions, as in post-2002 European Union, constitutes a deep form of economic integration and benefits for member states are quite substantial. Economic Unions possess all the features of Common Markets but are further characterized by economic policy harmonization.

Examine a global supply chain of clothing industries emphasizing Essay

Examine a global supply chain of clothing industries emphasizing relations of power among main actors - Essay Example The first one was the Multi-Fibre Arrangement (MFA) a regulatory framework that created preferential tariffs and quotas on the apparel industry on the commodities that imported by the developed nations such as U.S., EU states and Canada (Gereffi, & Frederick, 2010). However, in the period 1995-2005, the MFA quotas and tariffs were replaced by the World Trade Organisation’ (WTO) agreement on clothing and textile (Brambilla, Khandelwal, & Schott, 2010). The second crisis was the financial crisis of 2008, which hit the apparel industry resulting in the unemployment, increased social unrests and factory shutdowns due to decreased demand in the developed economies. Zara is one of the giant global retailers in the fast fashion industry incepted in 1975. The company is an entity of the Spanish group Inditex. By 1990, Zara had expanded globally into a number of states including New York, U.S., Paris, France and Oporto in Portugal. Currently, the company operates over 1830 outlets in 82 nations globally, located in Africa, America, Europe and Asia (Inditex, 2011). Zara considers itself as fast fashion retail chain rather than a high fashion brand, which has enabled it to expand and achieve high growth levels. Zara unlike other brands in the apparel industry uses a vertical integration model that encompasses just-in-time, design, sales and marketing (The Economist, 2001). For this reason, the company can respond to consumers demands in a prompt way, and this has been the key driving force for the accelerated growth of the company in the industry. Labour Intensive-This is because it requires a large number of labour forces to produce its goods or services. The degree of labour intensity is measured in proportion to the amount of capital required to produce goods or services; the higher the proportion of labour costs required, the more labour intensive the business (Bartley, 2005). The clothing