- Discuss the links between the diminishing effectiveness of political borders and the flow of goods, capital, labour and ideas, and the role of one multi-governmental organization such as the European Union (EU), the Association of Southeast Asian Nations (ASEAN), the North American Free Trade Agreement (NAFTA) and MERCOSUR (the common market of South America).
- Discuss the shift of power from nation state to TNCs as a result of their economic size and dominance.
- Compare the wealth of TNCs with that of nation states.
Globalisation has meant that many political borders are now much more fluid, with goods, ideas, money and people able to travel much more freely between locations. The increased movement can bring both positive and negative impacts. Below is a table of some of these impacts.
Here’s a view of the importance of country borders in today’s world:
Nation States and TNCs
Find definitions in your text books for the two key terms.
The largest ethnic group as percent of total population. Dark yellow: 85 and above; yellow: 65-84; light yellow: 64 and below; blue (No traditional ethnic definitions apply): the same scheme applies, but ethnicity is replaced by race. Source: WFB. Data as of 2000-2008
The Dominance of TNCs – Food Industry
- 60 percent of terminal grain handling facilities are owned by four companies: Cargill, Cenex Harvest States, ADM and General Mills.
- 82 percent of corn exporting is concentrated in three companies: Cargill, ADM and Zen Noh.
- Beef packing is dominated by an 81 percent share among four companies: Tyson, ConAgra, Cargill and Farmland Nation.
- 61 percent of flour milling capacity is owned by four companies: ADM, ConAgra, Cargill and General Mills
Wealth of TNCs vs Wealth of Nations
Using named examples, locations and statistics make notes on the ‘strength’ of TNCs. How have they become more dominant than some countries?
Nation States and the EU
Europe is a complex place. This diagram shows some of the membership patterns: (Click on image for larger copy, opens in new tab)
Produce a one sentence definition of each of the following:
- The Council of Europe
- European Union
- European Free Trade Association
- Schengen Area
- EU Customs Union.
According to the diagram – what ‘situation’ are the following countries in?
- United Kingdom
Aim of this lesson:
- To be able to discuss the links between the diminishing effectiveness of political borders and the flow of goods, capital, labour and ideas.
- To be able to discuss the role of one multi-governmental organization such as the European Union (EU).
You are going to take your own notes on each of the following sections:
What is the European Union?
How does the European Union impact the flow of goods?
The EU has created a single market across the territory of all its members.
The single market involves the free circulation of goods, capital, people and services within the EU.
Companies can sell their products anywhere in each of the member states and consumers can buy where they want with no penalty.
No customs are levied on goods traveling within the EU customs union and (unlike a free trade area) members of the customs union impose a common external tariff on all goods entering the union.
Once goods have been admitted into the market they cannot be subjected to customs duties, discriminatory taxes or import quotas, as they travel internally.
The EU is working to improve cross-border infrastructure within the EU, for example through the Trans-European Networks.
How does the European Union impact the flow of capital?
Currencies and capital can flow freely between the member states and European citizens can use financial services in any member state.
Free movement of capital is intended to permit movement of investments such as property purchases and buying of shares between countries.
Free movement of capital is an essential condition for the proper functioning of the Single Market. It enables a better allocation of resources within the EU, facilitates trade across borders, favours workers mobility, and makes it easier for businesses to raise the money they need to start and grow.
How does the European Union impact the flow of labour?
Citizens of the EU member states can live and work in any other country and their professional qualifications should be recognised.
With the lifting of most internal border controls, EU citizen can move as freely around Europe as we can within a Member State.
The Schengen Area comprises the territories of twenty-five European countries that have implemented the Schengen Agreement.
Implementing the Schengen rules involves eliminating border controls with other Schengen members while simultaneously strengthening border controls with non-member states.
The UK declined to join Schengen Convention elements related to passport control, one argument being that, for an island, frontier controls are a better and less intrusive way to prevent illegal immigration than other measures, such as identity cards, residence permits, and registration with the police, which are appropriate for countries with “extensive and permeable land borders”.