Globalization and its impact on Caribbean business organizations .
Globalization is an economic process in which the barriers between countries which have both positive and negative effects are decreased or removed altogether and there is interaction among different countries brought about by dramatic advances in technology and communication. Therefore it implies the opening of local and nationalistic perspectives of a boarder outlook of an inter – connected and interdependent world with free transfer of capital, goods and services across nation frontiers. Therefore, globalization has caused many impacts on Caribbean business organizations. Firstly, a large volume of foreign capital is being invested in the Caribbean countries. The foreigners themselves open up small firms in the Caribbean due to strong relationships made through trade and can provide that Caribbean country with employment for its people and also the tax the foreigners may have to pay will bring some form of revenue to the Caribbean country. Another impact is that Caribbean countries have been opened as trade including imports and exports which accounts for more than a 100% GDP for most countries.
This clearly states that since there are no barriers to trade, then the country is able to import as many good as it wants therefore accounting for a high percent of the country’s GDP. This is good for the local market because all the custom duties which had to be paid when goods were being imported are being decreased therefore they will not have to sell their goods at a very high rate for their local people therefore helping on the standard of living. Another impact is that the regions trading relationships tries to diversify its trading relationships beyond traditional partners for example US , UK and Canada therefore there is a wide variety of countries being traded with so that in the cases trade ties are lost with one country then the Caribbean country will not suffer as much because there are other trade partners they can turn to. Also, another impact is that firms are now organizing and reconstruction business to operate more effective and efficient in the global environment.
This may up rise to the formation of alliances, take over’s and regional expansion in the Caribbean businesses. One negative impact noted is that there is a lack of diversification of exports for example in St.Lucia, bananas were heavily relied on for exporting to other countries and there was a fall in the industry and now the country had to depend on tourism which is main industry now but is there was a diversification of exports then as there was a fall in the banana St.lucia would have another good to export to bring revenue in to the Caribbean. To conclude globalization increases interaction between countries as national borders become less significant and there are many impacts both good and bad on Caribbean businesses.