Groupings

Comment on the extent to which it supports the concept of the North/South divide. (7 marks)

The North/South divide used by the Brandt Commision, led by the Chancellor of West Germany in 1980, divided the world into the ‘Rich North’ and the ‘Poor South’ using the Brandt line. It roughly went around the world at 30*N.

To an extent, this theory is true if we look at the fig 5, the estimated percentage of the population that used the internet in the North is at least 30% or more. Internet usage is an indication of greater globalisation, allowing greater flow of information to make trading internationally easier. We know that most of these countries on the ‘Rich North’ are MEDCs such as Canada and USA, most of Europe including the UK, France and Spain at 40% usage or more, with Russia and a few Eastern Europe and Mid Asian countries at 20 – 29%. The ‘Poor South’ showed the continent of Africa such as Botswana and Burkina Faso, and Southeast Asia have 10 – 19% usage, indicate less technology used. Overall, fig 5 looked like there is a higher estimated percentage of the population used the internet in the ‘Rich North’ and the ‘Poor South’ have more countries with less internet usage, supporting the concept.

However, this is not all true as we can see the ‘Rich North’ have a few anomalies such as eastern European countries like Ukrain from the old Soviet Union block has 10 – 19% internet usage, and so is Kazahstan. This means the concept of North/South divide was realistic a few decades back but globalisation require greater usage of internet for communication. The ‘Poor South’ is experiencing rapid increase in internet usage in countries such as Chile, Argentina and Brazil of South America have 40% or more usage. The same is seen with Iran and the four Asian tigers (Taiwan, Hongkong, Singapore and Japan). Southeast Asian countries, especially, China, Vietnam, Thailand and Malaysia  having 20 – 29% estimated percentage of the population using the internet.

The concept is getting weaker evidently as some countries from the old Soviet Union block now fall into the categories of ‘developing’ and other countries regarded as ‘developing’ such as the Asian Tigers now appeared to cross over the divide so the ‘Rich North’ and ‘Poor South’

Outline reasons for the growth of social and/or economic groupings of nations. (8 marks)

The reasons for the growth of Social and Economic groupings of nations is aiming to advance development of domestic economies, social status and level of development of member states with examples like the G8, EU, NAFTA and the WTO. Despite the world is increasingly globalised, Groups of nations is still viewed as one of the best approaches to development - the process of social and economic advancements that allows improvements in people quality of life and general well being.

The creation of the single market for the EU with 27 member states original objectives was for the free circulation of goods, capital, people and services within itself, especially important to maintain peace by integrating the economies of main European powers after the Second World War. This enabled conflicts to resolve and enable general improvement in welfare, human bonds, travel and economic interaction – preventing Third World War. It is easier for residents to move around without a passport, seeking work abroad and tourists to travel without having to reapply for new visas.

The EU make it easier for member states to trade with each other by eliminating issues of exchange rate, hence the creation of the EURO in 1999, easing trade and travel for both workers and tourists. They also created a custom union with a common external tariff on all goods entering the market. This free trade taking place allowed the possibility of increasing competition for new businesses and resonal prices for households; and let’s not forget the Common Agricultural Policy offering subsidies to help the development of this sector which helped the farmer to profit and sustain themselves and ensuring food security for Europe, eventhough it has led to huge surplus.

The EU also helped equalise the level of development within by allocating funds to support underdeveloped region within the EU like Poland which has benefitted from investment shift to a greater market orientation from a state-controlled economy, infrastructure funds to improve road system and making it easier to link with EU neighbours.

Discuss the consequences of groupings of nations. (10 marks)

There are many groups of nations globally sharing common aim but slightly different. For example, the European Union was set up after WW2 in effort to integrate economies of power nation to maintain peace; G77 was designed to give less developed countries a chance to speak up in the international affairs; World Trade Organisation developed to liberalise organisation of capitalist countries to prevent intercontinental conflict - just a few. Theoretically, global groupings should enable member states achieve economic and social development usually by easing movement of goods, people and knowledge. However, because each country is at different state of development, have a different priority of problems and disagreement, not all member actually experience the same benefits and thus lead to some groups continue to fail to achieve their goal.

Take the EU as a case study, there are many economic benefits from the creation of the single market such as the EURO introduced in 1990 - the single currency that ease travel and trade by eliminating issues of exchange rate. The EU create a custom union with a common external tariff on all goods entering the market increasing competition for businesses within bloc and maintain a reasonable price. The EU allow greater interaction between member states and increase globalisation. Society is becoming more multicultural and the EURO helped generalised things within the union. Unemployment was solved due to migration e.g Polish worker in the UK and the EU allows the free movement of people without passport. 

The EU equalise the level of development within by allocating fund to support underdeveloped regions of the EU such as Poland to conform to the standards of the EU. Poland therefore benefited from investment to shift to a greater market orientation from a state-control economy, infrastructure funds improved the road system and its links to neighbouring states. The Trans-European Networks project include the Channel Tunnel and cover 75,000km of new roads and 78,000 km of new railways. Further more, the European Development Fund directs aid from the EU to developing countries, 2008-13 estimated to allocate over 10 billion Euros of aid.

This being said, market fluctuations of one single member state affect the entire group of nation as seen in the Eurozone crisis - the best example of how the single currency accentuated the vulnerability of the European market. There are also other problem such as debt defaulting of less developed member state, the EU has to bail out like Portugal's recent bailout in April 2011. Some economic sectors have also reduced competition due to sharing resources e.g traditional fishing grounds of the UK shared with Spain. The EU single market is restricting the rest of the world thanks to the tariff cuts. The EU nations are less likely to globalise  with other countries and lead to greater polarisation with the rest of the world.

The best example of negative economic impact has to be the Common Agricultural Policy which promotes development of the agricultural sector by taxing imports and subsidising agricultural purchases. This create an unbalance situation where farmers in the developing world is undercut, making them even poorer whilst farmers in the EU overproduce butter mountains and wine lakes. Despite these negative impacts, the EU since then has taken numerous steps in order to protect the environment such as placing environmental policy addressing issues of climate change such as acid rain, the thinning of the ozone laywer, air aquality, noise pollution and waste and water pollution. They set out aim for all member states to use 20% renewable energy and cut carbon emission by half by 2020 to 1990 levels. Whether this has been effective or not is debatable but they are taking action. There are also greater attempt to protect forests and creates animal habitats such as the Yorkshire Dales and Peak District.

Overall, groupings of nations enable greater globalisation, easier trading with international businesses and making it possible for policies to be taken out in many countries within the group, especially now that we need global effort to attack the issues of climate change. Other groups of nations enable small countries to have a voice in international affairs, have a say into policies that often impact them the most. However, negative issues can form too where the single market create an internal trade, polarising the rest of the world and may lead to a loss in cultural identity due to the multicultural society being created.