Examples of Globalization Occur in The Economy

Have you ever heard of the term economic globalization? What was you in your mind when you heard this term? In order to better understand the meaning, consider the explanation by example of globalization in the economic field.

In general, the meaning of globalization in the economic field is the process of integrating individual and state economies into the world. An example of globalization in the economic sector is the practice of exports and imports. Exports-imports can increase country forecasts and meet domestic needs.

Globalization that occurs in the economic sector has strongly influenced trade between several free countries. Because globalization is essentially aimed at eliminating obstacles that are the problem. Where the obstacles that become this problem occurs in international trade.

These constraints generally occur because export or import tariffs are too high so that goods prices are not competitive. This could also be the obstacle in the form of the trade policy imposed by a country to protect domestic production. In theory, these barriers are repulsed by free trade.

Understanding of economic globalization

The definition of economic globalization transmitted by Fakih (2002) to Agusalim (2017) is a process of integrating the national economy into the global economic system.

A form of economic globalization is marked by the growing opening of a country’s economy with international trade. In the meantime, this international commercial activity will affect a country’s economic growth because all countries compete in the international market.

When the process of entry into economy in the world, there are no more boundaries or barriers in a country or region. With the reason that this globalization sees only the world as a unit.

When a unit aims to create a very broad or free business area. Due to the influence of non-competitive prices of goods based on export and import tariffs with high prices.

Examples of globalization in the economy

This example of globalization in the economy also has characteristics easy to recognize. Such as the development of technology and market dependence, so there are interactions between crops.

Dr. Tanri Abeng, M., M.B.A is a former Minister of State for SOE Empowerment in the development firm VII and the development reform cabinet. It is also known as entrepreneur and former President of PT Pertamina (Perero). According to him, the true form of economic globalization occurs in the following examples:

1. Production

The first form is production that generally wants to put more emphasis on cost. When, in this case, a company will produce production in several countries to reduce production costs.

This step is taken because it is observed on the work pay factor in a country considered quite soothe or cheap. So that the rate of import duty to the country is also relatively cheap. Not only can this also be influenced by the infrastructure provided in a country.

Because the infrastructure provided is indeed more adequate to the business climate. Where the business climate in a country is considered favorable.

2. Funding

This form of funding for globalization in the economy makes more reference to the manufacture of loans or investments. Where this loan or investment can occur in all countries of the world.

PT Telkom is a company that can serve as an example of globalization in the economic sector. When PT Telkom wants to develop telephone units in various countries in order to invest other countries.

3. Work

The form of work can be used as a concrete example by the presence of foreign workers entering a country.

These workers work in other countries with the aim of earning high income. Because the income earned in his country is still weak.

But do not forget to look at the level or capacity of the workforce itself.

A concrete example of a foreign worker in Indonesia is a manual worker and professional staff who has a lot of work experience. This experience is obtained from its country of origin.

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4. Information network

The technological advances that occur today are examples of globalization in the economy in the form of information networks. With this technological advancement, all the information can be received quickly and also more accurate.

This information can be obtained by radio, television or internet. Where Internet is a very fast source of information. In addition to being fast, the Internet is not very easy when it is accessible by all people in the world.

That’s why famous brands such as the Canal, Gucci and International Fast Restaurant Restaurants are widely known around the world. Thus, this will have an impact on the tastes of people from other countries, both those cities and villages that have moved towards global tastes.

5. Trade

This form of economic globalization in the trade sector can be characterized by uniformity and reducing export and import tariffs in a country. As a result, barriers that become obstacles can be removed or have no tariffs in a country.

The goal is that other countries also delete the rates applied in their country during the export import process. As a result of world trade, supervision has become closer, faster and more right.

The realization of free trade tends to encourage each country to fully specialize in the production of goods with a comparative advantage. The willingness of a country of globalization depends on how the country encourages the products it produces to have a comparative advantage. With a comparative advantage, competitive products on the global market will be produced.

Several strategies aimed at increasing the competitiveness of international products, namely:

• Determine which countries will become competitors in international trade, such as product export.
• Paying special attention to the segmentation of the market that has sufficient chance to combat the predetermined country.
• Minimize national import activities.
• The creation of export exhibition activities is intended for potential importers to be familiar and wishing to try to market in their country.
• Use of technology software as a step of adapting to the era of global and digital competition.

In addition, companies must periodically evaluate their current international business strategies. Adaptation is one of the keys so that companies can survive various developments in the global economy and digital competition.