Patterns of World Trade (Leaving Cert Geography): Revision Notes

Patterns of World Trade

Global Trade and the World-System

Wallerstein's World-System Theory:

• The global economy operates as an interdependent system of countries competing economically and politically.
• Countries are connected through commodity chains:
• Networks of labour and production, from raw materials to finished products.

Structure of the World Economy: Core, Semi-Periphery, and Periphery

Core Regions:

• Dominate world trade and control advanced technologies.
• High levels of productivity, diversified economies, and the highest standards of living.
• Examples: USA, Germany, Japan.

Peripheral Regions:

• The "Slow World":
  • Low levels of technology and productivity.
  • Economies are underdeveloped or narrowly specialised.
  • Characterised by low standards of living.
• Examples: Sub-Saharan Africa, parts of Southeast Asia.

Semi-Peripheral Regions:

• Act as intermediaries:
  • Exploit peripheral regions while being exploited by core regions.
• Once peripheral but have developed to semi-periphery.
• Examples: India, Brazil, South Africa.
• Fluidity: Regions can change their status over time.

International Division of Labour

Globalisation has created a new international division of labour:

• Post-Industrial United States:
• Focuses on services, innovation, and consumption.
• Japan and the EU:
• Remain manufacturing powerhouses, producing high-value goods.
• Peripheral and Semi-Peripheral Regions:
• Low-wage areas dominate manufacturing.
• Examples: Nike's production in Vietnam and Bangladesh.

Patterns of Global Trade

Three Key Economic Areas:

1. USA:

• A global consumer powerhouse, importing goods from peripheral and semi-peripheral regions.

2. Europe:

• Integrated markets with luxury goods, machinery, and pharmaceuticals.

3. Pacific Rim Countries:

• Manufacturing hubs (e.g., China, South Korea) and emerging economies (e.g., Vietnam).

Global Commodity Chains:

• Example: Coffee.
  • Grown in peripheral regions (e.g., Ethiopia).
  • Processed in semi-peripheral regions (e.g., Brazil).
  • Sold in core regions (e.g., USA and Europe).

Advanced Stages of Globalisation

Globalisation is fostered by:

• International Agencies: World Bank, IMF.
• Global Communication Networks: The Internet and 24/7 business.
• International Laws: World Trade Agreements regulate trade across borders.
• New Technology Systems:
  • Innovations like robotics, biotechnology, and digital communications facilitate trade.
• International Consumer Markets:
  • Homogenised products create global demand for world brands (e.g., McDonald's, Apple).

Excluded Regions in Global Trade

• Conflict Zones: Afghanistan, Syria.
• Landlocked Countries: Chad, Nepal.
• Underdeveloped Economies:
  • Lack of infrastructure, political instability, and resource dependency exclude them from trade benefits.

Impacts of Global Trade

Advantages:

1. Economic Growth: Boosts GDP through exports and FDI.
2. Technology Transfer: Peripheral regions gain access to innovations.
3. Job Creation: Manufacturing and service jobs in semi-peripheral and peripheral regions.

Disadvantages:

1. Exploitation: Low wages and poor working conditions in peripheral regions.
2. Environmental Damage: Overuse of resources and pollution.
3. Dependency: Peripheral regions remain reliant on core regions for capital and technology.