Ataberk Güngör 05.12.

2018

Fall 2018, Sabanci University, SPS 102 Process Essay

Ataberk Güngör 24155

07.12.2018

Word Count: 1278

Topic: Globalization

Negative Effects of Globalization on South Africa

Globalization was a process of increment in economic, social and cultural relations

between nations and continents because of enhancements in transportation, technology and

changing governments’ policies. Globalization was characterized by science and technology

because of the reduction of the cost of transportation and communication. Therefore,

Globalization involved increased movement of labour and capital.1 It revised whole globe’s

economic equilibrium and caused redistribution of wealth. It had great impacts on

development levels and location on a whole globe such as England and South Africa. England

had been trading since first import and export terms came out in the world that’s why they had

lots of companies which can be considered as monopolies.2 With globalization, they had the

chance to use new discovered lands or carrying the production to cheaper places so that they

can make more profit. Besides, England had lots of large capacity ships and new technology

equipment for trade routes and tradable goods. So, Globalization means a new revealed

treasure for economy of England. On the contrary, South Africa had only population as

wealth because country was not using high technology of the time and means of production

was mostly based on people instead of machines. So, this situation made South Africa a

1
Doug Henwood, "The Americanization of Global Finance," NACLA Report on the
Americas 33, no. 1 (1999): doi:10.1080/10714839.1999.11722697.
2
Muthoka et al., "Globalisation in Africa: An Overview," Munich Personal RePEc Archive,
June 22, 2015, accessed December 07, 2018, https://mpra.ub.uni-muenchen.de/65474/.
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potential candidate to be used by large companies. As time passed by, we see that South

Africa’s external debt rose from 9.02 billion dollars to 30.02 billion dollars in 6 years and

made them the most heavily indebted region globally while they got lots of investments from

European and American companies.3 In addition to that South Africa politics became

dependent to European countries and companies because of mostly their economic and army

power Since, in governmental systems, economy plays a vital role because of it is directly

related with the society’s life style and politicians did not want to create an unstable economic

condition.4 So, it may be said that Globalization is one of the vital reasons that most African

states are deprived of their economic sovereignty by letting foreign investments for cash

inflow and letting developed countries interfere African politics to relieve from economic

depression.

At first sight, Countries of Africa was colonized by mostly Netherlands, England, Portugal

and France in a period starting in a 16th century. Lands of Africa was not precious according

to fertility because of the climate and society was not representing a unity as rest of the

countries in the world. They had limited technology and production was based on muscle

power which lead entire country to weak army and economy. Due to these situations,

European countries that I mentioned, treat African society as a capital and trade slaves or

force people to work in their factories to sustain the flow of Atlantic Triangle.5 As time passed

by, Africa started to revolt against Europe and earn their independence with wars and deaths.

These wars and deaths shaped South Africa today. Later, with globalization all countries got

together in one place because cost and time for trading across oceans decreased into a level

3
Economic Development in Africa Report 2018. Report. United Nations Conference On
Trade and Development. 28-46

4
Abdirahman Muhammed, "Economic and Political Impact of Globalization on
Africa," Istanbul Journal of Sociological Studies, 0, no. 51 (2015): doi:10.18368/iu/sk.44401.
5
Isaac Kamola, "Africa and ‘Globalization’," The SAGE Handbook of Globalization,
doi:10.4135/9781473906020.n15.
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Ataberk Güngör 05.12.2018

which every entrepreneur can afford transoceanic trade. Africa was in need of capital and

labour an abundant region in those times. At the same time, labour time and salary were

centre of the discussions in developed countries which made labour cost higher than any time

interval in the history. Therefore, companies moved their tendency for production to

developing countries for cheap labour and low taxes. This tendency creates a trade route

between developed countries such as England, USA, France and South Africa. South Africa’s

encouragement for new special facilities and developed countries’ neoliberal-driven

globalization understanding came together and caused lots of foreigner companies to build

factories. Leading sectors of these factories were chemicals, Electronics, Metals, Textiles and

Clothing. In early years, average rate of increase of GDP in South Africa was 6.2% which was

a great divergence for a country which did not have lots of natural resources to export.6

However, government was far away to see that most percentage of the money that earned by

sales was gathered by investors of these companies which were foreigners and employing

people under harsh conditions such as more than 12 hours a day and paying mostly 100

dollars for a month. This caused a situation which is entrenching existing inequalities between

the rich and poor, rather than improving the lot of all the South Africa’s citizens. Besides,

according to past years South Africa was developing according to economic statics due to

pain of labours of their citizens but they were getting lower positions as against countries that

invest on South Africa. For instance, in the same year, GDP of South Africa was 3,2 while

GDP of England was 4,77. This system caused oppression on African economy because most

of the GDP was granted by foreign investors and they were holding a power which can cause

an economic depression if they stall reproduction and fire all workers. As a result,

Government realized it too late and get deprived of their economic sovereignty.

6
"Trade and Globalization," Our World in Data, accessed December 07, 2018,
https://ourworldindata.org/trade-and-globalization.
7
"Report for Selected Countries and Subjects," IMF, accessed December 07, 2018,
https://www.imf.org/external/pubs/ft/weo/2018/01/weodata/werept.asp.
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Ataberk Güngör 05.12.2018

Continent of Africa consists of many tribes and etnicity. This is why formation of a unity

or country was very late for them because tribes and regions were sell-sufficent in their towns and

eagerness for new techonologies or greater dominance on others were not in their culture as much

as in Europeans or Americans. With globalization, awareness about environment and culture

started to change.8 Citizens start to move big cities and change their life routines. Crimes

increased because of the poverty and this instant change create lots of slums because city planing

was not able to expand carrying capacity of the city in a short time period. 9 İn this change, ruling

these people were very demanding and tough for politicians because there were lots of problems

such as increase in crime rates, unemployment, medical issues, transportation and education

problems10. Society were facing these problems at the same time and this situation was causing

unsustaniable environment for improvements. Problems were moslty based on poverty so

politicians decided to let other foreigners to invest and use african lands as their lands with low

taxes and full of rights to do anything in financial matters and working conditions as long as

workers accept.11 İn this case, there were lots of citizens who accepted the terms of foreigners

because government was not able to promise them a real job. With this system every economic

score was increasing and problem levels were decreasing but prosperity of government and

society got dependent to these investors which means these foreigners are manipulative powers. 12

As a result, Government needed to consider decisions of these markets and they needed to sustain

their profit how they want them to have because in loss case for investors, they can leave country

8
Fridah Muyale-Manenji Muyale-Manenji, "The Effects of Globalization on Culture in Africa
in the Eyes of an African Woman," Lutheran Churches - World Council of Churches,
November 11, 2014, accessed December 07, 2018.
9
"South Africa – OECD, Globalisation, Regional Integration and Prospects for South Africa,"
Estadísticas - OECD, accessed December 07, 2018,
http://www.oecd.org/southafrica/globalisation-regional-integration-and-prospects-for-south-
africa.htm.
10
"Jobless Growth," The Economist, June 03, 2010, accessed December 07, 2018,
https://www.economist.com/special-report/2010/06/03/jobless-growth.
11
Okechukwu Ethelbert Amah, "Globalisation and Leadership in Africa," 2019,
doi:10.1007/978-3-319-98764-4.
12
"Globalization, Interdependence and Development," UNCTAD | Investment Country
Profiles, accessed December 07, 2018, https://unctad.org/en/pages/GDS/GDS.aspx.
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on their own with past problems. This liberal system let developed countries to interfere African

politics to relieve their economic depression.

In conclusion, South Africa was 32th position in the world’s biggest economies in

201713 which is a great increment if their past is considered but to be able to achieve that aim, they

give permission to use lands and citizens as foreigners’ explotation resources and Globalization

was holding a meaning that South Africa was deprived of their economic sovereignty by

letting foreign investments and letting mostly European countries and USA hold a significant

role on African politics to relieve from poverty and economic problems. These strategies were

used for short term benefits and had deep effects on the country. Today, South Africa is

moving in a path that they are taking their independence step by step with the capital that they

earned by foreigners in those years and according to statics they are increasing their local

firms’ share in GDP. Globalization effected South Africa in early years as colonization that I

explained in second paragraph, South Africa is adapting to new system and trying to take

back their economic sovereignty.

"World Development Indicators," Search | Data Catalog, November 14, 2018, accessed
13

December 07, 2018, https://datacatalog.worldbank.org/dataset/world-development-indicators.

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Bibliography

Amah, Okechukwu Ethelbert. "Globalisation and Leadership in Africa." 2019.

doi:10.1007/978-3-319-98764-4. v

Economic Development in Africa Report 2018. Report. United Nations Conference On Trade

and Development. 28-46.

"Globalization, Interdependence and Development." UNCTAD | Investment Country Profiles.

Accessed December 07, 2018. https://unctad.org/en/pages/GDS/GDS.aspx.

Henwood, Doug. "The Americanization of Global Finance." NACLA Report on the

Americas 33, no. 1 (1999): 13-20. doi:10.1080/10714839.1999.11722697.

"Jobless Growth." The Economist. June 03, 2010. Accessed December 07, 2018.

https://www.economist.com/special-report/2010/06/03/jobless-growth.

Kamola, Isaac. "Africa and ‘Globalization’." The SAGE Handbook of Globalization: 231-44.

doi:10.4135/9781473906020.n15.

Muhammed, Abdirahman. "Economic and Political Impact of Globalization on

Africa." Istanbul Journal of Sociological Studies, 0, no. 51 (2015). doi:10.18368/iu/sk.44401.

Muthoka, Sila, Muthuri, Evan, Oginga, and Jared. "Globalisation in Africa: An Overview."

Munich Personal RePEc Archive. June 22, 2015. Accessed December 07, 2018.

https://mpra.ub.uni-muenchen.de/65474/.

6
Ataberk Güngör 05.12.2018

Muyale-Manenji, Fridah Muyale-Manenji. "The Effects of Globalization on Culture in Africa

in the Eyes of an African Woman." Lutheran Churches - World Council of Churches.

November 11, 2014. Accessed December 07, 2018.

"Report for Selected Countries and Subjects." IMF. Accessed December 07, 2018.

https://www.imf.org/external/pubs/ft/weo/2018/01/weodata/weorept.aspx?

sy=1980&ey=2023&scsm=1&ssd=1&sort=country&ds=.&br=1&c=199&s=NGDP_RPCH,P

PPGDP,PPPPC,PCPIPCH,LUR,GGXWDG_NGDP&grp=0&a=&pr.x=98&pr.y=2.

"South Africa – OECD, Globalisation, Regional Integration and Prospects for South Africa."

Estadísticas - OECD. Accessed December 07, 2018.

http://www.oecd.org/southafrica/globalisation-regional-integration-and-prospects-for-south-

africa.htm

"Trade and Globalization." Our World in Data. Accessed December 07, 2018.

https://ourworldindata.org/trade-and-globalization.

"World Development Indicators." Search | Data Catalog. November 14, 2018. Accessed

December 07, 2018. https://datacatalog.worldbank.org/dataset/world-development-indicators.