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How Globalization has Affected South Africa

 

Author: Rispa Akello, Mar 1, 2013 @ 15:02

How Globalization has Affected South Africa

Since its inception in the dictionary, the term globalization had many interpretations with regards to meaning. Watson, has defined globalization from a cultural perspective as “the process by which the experience of everyday life, marked by the diffusion of commodities and ideas, can foster a standardization of cultural expressions around the world.” World Bank on the other hand, has defined this term from an economic perspective as “the freedom and ability of individuals and firms to initiate voluntary economic transactions with residents of other countries.” Al-Rodhan however asserts that globalization is neither a single concept and so cannot be explained with regards to a specified time or frame nor is it a process that has an elaborate start and end points. He states that globalization entails; an integration of different economies, cross-border policies transfer, knowledge transmission, and the establishment of a global market which is free of social or political control. The most elaborate definition of globalization is given by Mittelman who refers to globalization as a syndrome or processes of activities as opposed to one element. He speaks of a global village that is achieved through the reduction of both time and space where a pool of common resources is available and a greater sense of economic, political and social interaction is achieved. The purpose of this paper is to analyze and discuss in detail the ways in which globalization has impacted South Africa.

Globalization and Economic Development in South Africa

One of the benefits of globalization is the rise in living standards of people in countries around the world. The dynamic structure of the global economy as a result of globalization has influenced the macroeconomic policies in the world towards the realization of even greater globalization benefits. Some of the key policy making bodies that have been impacted include; the academic economists, the national policy making bodies, the general policy making community and the International Monetary Fund (IMF).

The worldwide economic changes as a result of globalization have influenced the way in which the IMF works including numerous multilateral institutions. For instance, the role of the IMF changed in the 1970s when the Bretton Woods system which dictated fixed exchange rates among the industrial countries came to an end. In the more recent years, the global economy performance and the functioning of the IMF have been influenced by myriad factors such as; the downfall of communism, financial crises in rapidly-growing market economies, rise in size and significance of private capital flows as well as a better comprehension with regards to management of macroeconomics. As a member of the global village, and the sole African G8 member, South Africa has been affected by all the changes that have taken place.

South Africa re-joined the scene of international economy in the 1990’s during which time globalization had started to gain prominence. In addition to adjusting to the demands of the globalization forces, South Africa had to cope with its status as an emerging market. The policies implemented enhanced economic globalization at both national and international levels by allowing for liberalization of investment, finance and trade. The above led to increased competition and speculation between the economies of various countries and South Africa was no exception. Globalization led to the economic growth of South Africa during the period between 1990 and 2000.

There is a distinct integration of the South Africa’s economy with the world economy judging by the difference between the GDP and the GNP. The measure of this difference compares the payments the country has made to the foreign owned factors of production which operate in the country to those received by domestic owned production factors that operate overseas. The divergence of the two measures indicate that before South Africa became a player in the world economy, its economic output was geared toward dominance by foreign-owned companies before going through a period of stagnation during the mi-eighties. After engagement in the world economy however from the 1990’s, South Africa has seen a move towards the foreign-owned corporations contributing more in terms of economic output. According to Loots, the country is impacted by globalization through its import-export trading activities, its net Foreign Direct Investments (FDI) inflows and its net portfolio inflows. Upon application of the Pearson Correlation test to determine the relationship between economic growth and the other independent variables, it was established that there is a positive 0.944 correlation between the economic growth and trade. Trade, comprising of both import and export activities, is an important component of the industrialization process.

Globalization and industrialization in South Africa

It is impossible to discuss trade away from industrialization and vis-à-vis. Through industrialization, trade both local and international is made possible. The apartheid policies which were instituted to govern the country’s industries before its independence resulted in international sanctions and other protectionist policies that negatively affected South Africa’s manufacturing segment. The industrial firms were isolated from the global economy forcing the manufactures of the country’s economy to produce solely for the country’s domestic market. These policies also discouraged small and medium enterprises from starting up or flourishing and did not invest in the development of human capital. A cocktail of high import tariffs, international sanctions and lack of incentives for production improvement resulted in an uncompetitive industrial environment. Ultimately, the end result was an unproductive manufacturing sector marred by obsolete technology and processes.

However, with the re-integration of South Africa into the global economy during the early 1990’s, the liberalization policies enabled the country overcome many of the challenges it previously faced. Industrialization has since gained speed and according to Green, South Africa experienced an annual average of 6.7% in manufactured exports between 1990 and 2005 a 3.8% increase from the previous 20 years. Globalization has enabled manufacturers access a wider market base across the world and has also enabled consumers access a variety of goods and services.

Globalization and cultural conflict in South Africa

Through advancements in technology, communication and transport channels, globalization has also been enhanced.  Such advancements are continually bringing humanity together in economic, communications and transportation networks.  These networks have made it possible for cultural ideas and images to be transferred instantaneously from one part of the world to another through the use of wireless and satellite technologies.  Consequently, different cultures from around the world are coming into contact at amazing speeds. There is therefore need to develop cultural understandings through the establishment of a global culture which is capable of rising above the ethnic, racial, economic, political and even religious conditions of the people that come into contact.

Fukuyama, a philosopher, predicted that this kind of global culture would be founded upon the principles of the Western societies and in particular, the United States. Unfortunately, the adoption of such a culture will be faced by numerous difficulties, resistance and conflict especially by the developing countries.  This is because the primary principles governing the cultures of Western societies emphasize on individual rights as opposed to those that govern developing nations that place emphasis on protecting the livelihood of those joined by race, religion, ethnicity or language.

South Africa, as a result of globalization, comprises of different cultural groups in terms of race, ethnicity, religion and language. It is estimated that 76.3% of the population in South Africa is made up of Black people while 12.7% is made up of whites. 8.5% is said to be colored as the remaining 2.5% is said to be Asian. Further, numbers show that in terms of ethnicity, the ethnic groups with the highest numbers are; Zulu, Tswana, Swazi, Xhosa, Tsonga and Sotho. The white population is sub-divided into two groups; the Afrikaners and the English descendants.  The highest spoken language is Zulu while the most common religion is Christianity. The interaction of the above races, ethnicities, languages and religion has led to a clash of the cultural beliefs and practices involved. For instance, conflict arises between the U.S. culture of secular individualism and the traditional African beliefs of the Bantu speakers. The Bantu speakers believe that there is a connection between a person and his homestead together with the community at large. In addition, they believe in both living and incorporeal spirits. This is in contrast with the U.S. secular individualism which doesn’t deny the existence of such spirits but implies that the lack of proof of such existence leaves the decision to the individuals.

Another example of a conflict exists between the U.S secular individualism culture and the Afrikaner culture of South Africa. The Afrikaners culture believes that people are belong to a larger group created by God for a purpose. The U.S. secular individualism doesn’t dispute the existence of God, but leaves the decision of whether God exists or not to each individual.

Effects of globalization on Higher Education in South Africa

Through globalization, the international cross border movement of people has been made possible. Maharaj states that there is a rise in the number of professionals who are crossing international borders for exploration of new career opportunities. Throughout the world, academia is impacted on differently by the various global trends. For instance, the global acceptance of English as the formal language for research has facilitated for the travel by various individuals in the academic scene pursuing research and teaching opportunities. Globalization too has enabled the academic styles from different parts of the world to be tailored in a more similar and acceptable fashion. Immigration regulations have been formulated in such a manner as to attract highly skilled labor as universities and other learning institutions seek the best possible professionals available from across the world. This has led to the flow of academic talents from developing to developed nations.  South Africa, like many other developing nations, is losing a large percentage of its academic talent to the developed world. Maharaj asserts that this “brain drain” has adversely affected the academic institutions among the developing nations.

The counter in-flow of academic personnel in South Africa’s higher education institutions is also notable. According to the Higher Education Management System (HEMIS), 42% of the total academic inflows as from 2005 to 2008 come from Europe. The other percentage is shared by Zimbabwe, Asia and Australia. Even though the deregulation of the academic labor market has enhanced the recruitment of personnel and students, it has made it hard to get a permanent position as an academic professional.  There are also a big number of foreign students enrolled in South African universities which is a positive indication that the university education in South Africa is internationalized.

Globalization and the HIV/AIDS pandemic in South Africa

According to a yearly antenatal survey, the prevalence rates of HIV in South Africa between 1992 and 2002 rose from 2.2% to 26.5%. Globalization presented a challenge to the post-apartheid administration as the state lost its sovereignty to the dictates of globalization in terms of policy formulation and implementation. The concepts of globalization and the HIV/AIDS pandemic are inseparable because through HIV, both the contradictions and unequal distribution of the advantages of globalization are exposed. The HIV scourge brings to light the injustices contained within the global political order. The western world has relegated AIDS to the status of a chronic disease because it has access to ARV drugs while it is a fatal disease in the developing world as a result of inaccessibility to ARVs. This contradicts the western world’s concern and calls with regards to human rights and HIV to provide adequate health-care for all humanity.

South Africa faced numerous challenges from globalization as it attempted to respond to the epidemic. This was because globalization influences the kinds of social policies the state makes with regards to social welfare and in this case, the state of South Africa was inhibited by the greater global policies when it attempted to take initiative on the HIV menace. It however struggled to maintain its autonomy by challenging the status quo through the conformity to global macroeconomics dictates while at the same time pursuing for social equity in terms of globalization benefits.The momentary change of focus from social policies to politics unfortunately caused the death of people as a result of HIV/AIDS but the adoption of the HIV and AIDS Care, Management and Treatment Plan in 2004 is a notable milestone towards the fight against the pandemic.

In conclusion, globalization cannot be defined as a single concept as indicated in this discussion. It is a dynamic process that impacts on the social, economic and political spheres of different societies in unique ways. South Africa through its apartheid policies had been blocked out of the global activities for a while. However, in the wake of 1990’s it re-entered the global scene and since then has been affected in numerous ways by globalization. Even though globalization has positive impacts on a given country in terms of economy and social interaction, it also has its disadvantages.

Works Cited

Al-Rodhan, Nayef. “Definitions of Globalization: A comprehensive Overview and a Proposed     Definition.” Web. 24 Apr 2012.

Gleick, James. Chaos: Making a New Science. New York: Penguin, 1987. Print.

Green, Phil. “Industrialisation in South Africa: The Impact of globalization.”wordpress.com,        (2009). Web. 24 Apr 2012.

Johnson, Krista. “Globalization, Social Policy and the State: An Analysis of HIV/AIDS in South Africa.” harvard.edu. Web. 24 Apr 2012.

Loots, Elsabe. “Globalisation, Emerging Markets and the South African Economy.” Essa.org.za,  (2006). Web. 24 Apr 2012.

Maharaj, Ashika. “The Impact of Globalization on South African Higher Education Institutions:  Patterns of Academic inflow into the South African Higher Education System.” Delhi Business Review 12.1 (2011): 37-50. Web. 24 Apr 2012.

Mapuva, Jephias. “The Impact of Globalization on South Africa’s Economic Development.”         Journal of Sustainable Development in Africa 12.2 (2010): 390-413. Web. 24 Apr 2012.

Nayan, Chanda. Bound Together: How Traders, Preachers, Adventurers, and Warriors Shaped     Globalization. pima.edu, Web. 24 Apr 2012.

Sijuwade, Philip. “Globalization and Cultural Conflict in Developing Countries: The South           African Example.” Anthropologist 8.2 (2006): 125-137. Web. 24 Apr 2012.

 


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