Singapore Globalization: Criterias and Ranks

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Topic: Business & Economics
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With the development of technology and the growth of international relationships, globalization has become an (ironically) global tendency. But what exactly does it mean for a country – to be globalized? And what challenges a modern developed country would face if it wanted to become more globalized?

The article on CNO Innovation website states that Singapore was reported by The Economist to be the most globalized country in the world in 2009 (“HK, Singapore”, 2010). However, what exactly does that mean? The article explains that the criteria used for evaluation fall into 5 categories: “openness to trade; capital movements; exchange of technology and ideas; labor movements; and cultural integration” (“HK, Singapore”, 2010, para. 2).

To explore it further, let us turn to the discussed report. It states that the index was made by using criteria which were perceived as the most relevant ones by big business leaders (“Redrawing the map”, 2010, p. 28). As it can be seen, Singapore rated the highest on the “Trade”, or “Movement of goods and services” category (9.59), which means that the city-state had a high percentage of total trade (“HK, Singapore” (2010) observes it to be 300% of Singapore’s GDP (para. 4)), as well as very little barriers to international trade (“Redrawing the map”, 2010, p. 26).

The next highest score was gained in the “Culture” category (7.93), which primarily means well-developed tourism, international communication, and the culture’s openness to foreign influence (“Redrawing the map”, 2010, p. 26-28). On the other hand, Singapore’s scores on “capital”, “technology” and “labor” categories were significantly lower: 6.17, 6.39, and 6.27, respectively (“Redrawing the map”, 2010, p. 26).

This means that trade and culture categories (together weighing 39% of the overall score) made the first position possible. The high trade score is no wonder, taking into account that Singapore is a city-state that cannot sustain itself without external trade. This also results in high international communication rating (culture category). On the other hand, the developed tourism is the result primarily not of the status of a city-state, but of the international fame that Singapore enjoys.

The USA scored an overall 4.26 and occupied the 24th position on the 2009 rating. The highest grade is received for capital (5.28); then for technology, trade, and culture (4.24, 4.20, and 4.12, respectively), and labor goes last (3.34) (“Redrawing the map”, 2010, p. 26). It means that, to make its level of globalization as high as Singapore’s, the US (or any other developed country with similar scores), would have to greatly improve most of the parameters.

But the question about which of the parameters should actually be improved arises, for globalism, despite its advantages, has a lot of serious drawbacks, such as wage cuts for American workers (due to the availability of cheap labor abroad; a result of movement of capital), companies avoiding to pay taxes be moving to other countries (one more a result of movement of capital), social welfare schemes being disrupted (Collins, 2015). Movement of goods and services (especially export), cultural integration, and exchange of technology and ideas seem to be the safest parameters to improve.

To sum up, we will point out that Singapore got its first place in particular due to its geographical location and its small size. To get the first place, other spheres should be changed in a big country, not only those ones that gave Singapore its first place on the rating. It is necessary to point out, though, that globalization is often associated with numerous drawbacks. Consequently, a country must be careful when it chooses to increase its globalization level and carefully weigh all the pros and cons before doing particular steps.

References

Collins, M. (2015). The pros and cons of globalization.

HK, Singapore: Top 2 most globalised economies. (2010).

Redrawing the map: Globalization and the changing world of business. (2010).