Cambridge International AS/A Level Geography Revision Guide 2nd edition
These are the notes for the GLOBAL INTERDEPENDENCE section of the CIE A level Geography syllabus. Other modules available on this website. A* notes in full.
Global interdependence A* revision notes for CIE A level Geography
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Geography
Unit 3 - Advanced Human Options (9696)
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Contents
The history of trade (how globalisation began) ...................................................................................... 6
The theory of core and periphery ........................................................................................................... 8
Global patterns and Inequalities in Trade Flows .................................................................................... 8
Factors affecting trading patterns since 1945 .................................................................................... 9
The EU Trade Bloc ................................................................................................................................. 10
Members & Purpose: ........................................................................................................................ 10
The World Trade Organisation (WTO) .................................................................................................. 12
Factors affecting global trade: .............................................................................................................. 12
Resource endowment ....................................................................................................................... 12
Comparative advantage .................................................................................................................... 12
Locational advantage ........................................................................................................................ 12
Investment ........................................................................................................................................ 13
Historical factors ............................................................................................................................... 13
Terms of trade................................................................................................................................... 13
Changes to the global market ........................................................................................................... 13
Trade agreements ............................................................................................................................. 13
OPEC...................................................................................................................................................... 14
Globalisation: ........................................................................................................................................ 14
Wallerstein’s dependence theory suggests inequality: .................................................................... 14
Why some countries are more developed than others ........................................................................ 15
Debt................................................................................................................................................... 15
Debt-service ...................................................................................................................................... 15
Other measures of debt: ................................................................................................................... 15
Debt on a national scale........................................................................................................................ 16
Trade deficit ............................................................................................................................................ 16
Odious debt........................................................................................................................................... 16
Origins of the international debt crisis ................................................................................................. 17
How poorer countries get into debt & the impacts of it .................................................................. 17
Current Trends in Debt ......................................................................................................................... 17
HICs – ................................................................................................................................................ 17
LICs – ................................................................................................................................................. 18
Criticisms to the HIPC and MDRI initiatives .......................................................................................... 18
Solutions to the debt crisis......................................................................................................................... 19
Cancel the debt ................................................................................................................................. 19
1
, Allowing them to develop sustainable development projects ......................................................... 19
Encourage ‘Fair Trade’ ...................................................................................................................... 19
Link debt to environmental issues .................................................................................................... 19
Debt conservation swaps .................................................................................................................. 19
Uganda – Debt Relief ............................................................................................................................ 19
Case Study: Fair Trade Bananas in Dominica ........................................................................................ 21
Case Study: Kuapa Kokoo (KK) Fairtrade Co-operative Case Study ...................................................... 22
Punjab Pakistan Voluntary WaterAid (NGO)......................................................................................... 23
Water Aid elsewhere ........................................................................................................................ 23
Costa Rica – USA debt for conservation swap ...................................................................................... 24
Benefits for Costa Rica ...................................................................................................................... 24
Benefits for the USA.......................................................................................................................... 24
Aid ......................................................................................................................................................... 24
The vicious cycle of trade, aid & despair .......................................................................................... 24
Types of aid donors ........................................................................................................................... 24
Official Development Assistance .......................................................................................................... 25
The OECD .............................................................................................................................................. 25
Why do countries give aid? ................................................................................................................... 26
Altruism or self-interest? .................................................................................................................. 26
Why do developing countries accept it? .............................................................................................. 26
Top down vs Bottom up ........................................................................................................................ 27
The origins of international aid ............................................................................................................. 29
Positives and negatives of aid on the receiving country...................................................................... 30
Positives and negatives of aid on the donor country ........................................................................... 31
Micro-credit – FDI ................................................................................................................................. 32
Trade VS Aid for development? ............................................................................................................ 32
Multilateral Case Study 1: The World Bank (1944) ............................................................................... 33
Multilateral Case Study 2: The International Monetary Fund (1945) ................................................... 33
The effectiveness of aid on narrowing the development gap .............................................................. 34
1970s – a more human approach to narrowing it: ........................................................................... 34
Tourism ................................................................................................................................................. 35
FACTORS INCREASING TOURISM ..................................................................................................... 35
FACTORS DECREASING TOURISM .................................................................................................... 35
Examples of the development of holiday locations.......................................................................... 36
International tourism statistics - present ............................................................................................. 36
Reasons for the dip in tourism in 2003: ............................................................................................ 37
2
, Reasons for the dip in 2009: ............................................................................................................. 37
Why America has less international tourist arrivals than Europe even though its 4x bigger:.......... 37
Key travel motivators ............................................................................................................................ 37
Leisure ............................................................................................................................................... 37
Business............................................................................................................................................. 37
Visiting friends & relatives ................................................................................................................ 37
World’s top tourist destinations ....................................................................................................... 38
World’s top international spenders .................................................................................................. 39
International tourism arrivals – forecasts between 2020-2030 ........................................................... 39
America ............................................................................................................................................. 39
Africa ................................................................................................................................................. 39
Middle East ....................................................................................................................................... 39
Europe ............................................................................................................................................... 40
Asia & Pacific ..................................................................................................................................... 40
The Impacts of Tourism ........................................................................................................................ 40
Direct impact..................................................................................................................................... 40
Indirect impact .................................................................................................................................. 40
Induced effects.................................................................................................................................. 40
POSITIVE IMPACTS OF TOURISM ...................................................................................................... 41
NEGATIVE IMPACTS OF TOURISM..................................................................................................... 41
Sustainable tourism .............................................................................................................................. 43
Tourist ................................................................................................................................................... 43
Recent Developments of Tourism – Niche Tourism ............................................................................. 44
Ecotourism/wilderness ..................................................................................................................... 44
Recession tourism ............................................................................................................................. 44
Educational tourism .......................................................................................................................... 44
Conflict/dark tourism ........................................................................................................................ 44
Medical tourism ................................................................................................................................ 44
Sports tourism................................................................................................................................... 44
Religious tourism .............................................................................................................................. 44
Doxey’s Index of Irritation..................................................................................................................... 49
The Butler Model .................................................................................................................................. 49
Carrying Capacity .................................................................................................................................. 50
Optimum Carrying Capacity .............................................................................................................. 50
Factors influencing carrying capacities ................................................................................................. 50
1. Type of tourism it attracts: ....................................................................................................... 50
3
, 2. Type of tourist activity: ............................................................................................................. 50
3. Opinions of tourists:.................................................................................................................. 50
4. Planning & management: ......................................................................................................... 50
1) Social structure: ........................................................................................................................ 50
2) Culture: ..................................................................................................................................... 50
3) Environment: ............................................................................................................................ 50
4) Development of the economy: ................................................................................................. 50
5) Resources and infrastructure:................................................................................................... 50
How carrying capacity links in with the Butler model .......................................................................... 51
How the seasonal nature of tourism can effect tourist destinations ................................................... 52
Management of Tourist Destinations ................................................................................................... 52
Ecotourism CS & Management of a Tourist Destination CS – .............................................................. 53
The Galapagos Islands ....................................................................................................................... 53
Jamaica.............................................................................................................................................. 53
4
, GLOBAL INTERDEPENDENCE
Trade: the exchange of goods & services for money
Some positives –
• Boosts employment – generating tax income for the government and people have
wages to spend in the local economy
• Trade can have positive multiplier effects – once a resource/industry is trading
globally, other companies can provide services or components to the
resource/industry, boosting the economy further
• TNCs can bring technology and training when they trade in nations – these skills are
transferrable thus, technology and skills of locals are boosted in the poorer nation
• Trade helps developing countries to maintain their dignity allowing them to work
their way out of poverty – “Give a man a fish and feed him for a day, teach him how
to fish and feed him for a lifetime”
• Trade is often favoured over aid due to the examples set by the Asian Tigers – e.g.
South Korea
• Trade blocs aren’t always bad – due to the creation of NAFTA, Mexico became one of
the largest recipients of FDI among emerging markets (now a MINT country which
are the new BRICs: potentially future economic powerhouses) receiving over 150$Bn
• The EU has grown much more than a means for trade, but also toward social,
political, economic and environmental cooperation
Some negatives –
• Open free trade can be risky to vulnerable economies – poor nations with fragile
economies dealing with small numbers of products with high price variability
• Trade requires investment first – many poor nations don’t have money to invest in
making their industries efficient in order to compete with richer nations
• Free trade as desired doesn’t really exist due to protectionism and trade blocs –
areas like the EU protect their industries behind trade barriers such as import tariffs
whilst subsidising their own industries – damaging poorer nations ability to trade
• Trade can be viewed as a form of neo-colonialism – richer nations and their TNCs are
accused of using the natural resources and people of poorer nations to their own
advantage
• Trade can encourage ‘a race to the bottom’ as companies seek the lowest cost of
goods at the detriment of the natural environment and conditions of employment
• Trade is dependent on other countries’ economies - The East Asian Financial Crisis
occurred and Asian economies started to fail – confidence in Asian markets fell and
TNCs withdrew their money, Japanese recession in the same decade meant that
export markets shrank
• Future competition with growing economies could hinder Asian Tiger economic
growth and TNCs look towards RICs – recently rapid industrialised countries due to
their cheaper workforces
5
,Imports: goods & services purchased from another country
Exports: goods & services sold to other countries
Balance of trade: difference between the value of a countries imports & exports
Trade deficit: occurs when the value of a countries imports exceed the value of its exports
Trade surplus: occurs when the value of a countries imports is less than the value of its
exports
Visible trade: involves items that have a physical existence e.g. primary products (raw
materials) such as oil, food and secondary products (manufactured goods) such as cars and
furniture
Invisible trade: trade in services e.g. tourism, travel, business & financial services
The terms of trade:
The price of a countries exports relative to the price of its imports & the changes that take
place over time.
The world market price of primary products is generally low compared to manufactured
goods & services. If countries reply on the export of commodities that are lower in price &
need to import items that are relatively high in price, they need to export large quantities to
be able to afford a relatively low volume of imports (likely to be down to neo-colonialism)
The world market price of primary products has been low in general compared to
manufactured goods and services – the cost of primary products are extremely variable and
thus make economic and social planning difficult causing many nations to struggle to
alleviate poverty with high trade deficits On the other hand, MEDCs exports of
manufactured good and services generally rise in price at a fairly predictable rate meaning
more regular income and less uncertainty
Trade is vital for development:
2 billion people live in countries that have become less rather than more globalised (in an
economic sense) because their trade has fallen in relation to national income.
The history of trade (how globalisation began)
Colonisation is the process of settling among and establishing control cover the indigenous
people of an area.
Early connections: 1492 was a major turning point in world history – Columbus first landed
in America and established European control. He began a pattern of trade & development
that shaped the global economy. Thousands of people had their way of life changed as
these early connections were made – some gained, some lost
6
, Today’s patterns of wealth, trade and development have been shaped by the past, here is
an example –
The story of Tenochtitlan:
When the Spanish conquered it in 1519, Tenochtitlan is now called Mexico City, it had 300,000 residents (5x more
than London)
It was an agricultural city divided by canals and self-sufficient for food – using mud from the canals as fertiliser, 3
harvests were possible each year
Within a generation, Tenochtitlan (future Mexico city) had changed beyond recognition as European colonial
systems were imposed by the Spanish
The old farm systems fell into ruins and by 1538 the first food shortages occurred
By the 18th century, large Spanish-owned estates had increased agricultural production and the valley was self-
sufficient again. But most of the native population had lost their land and were pushed into areas of poorer soil
Clearing forests for large estates caused environmental destruction
In the mid-1980s, the Mexican government reported that ‘land use problems are linked to the lack of soil
nutrients’. Overgrazing and deforestation led to resource depletion in the valley, there are serious pollution
problems due to waste from homes and industrial zones. Water shortages mean the 17 million people depend on
water from the surrounding mountains.
Mexico today is one of the most polluted cities in the world
European countries became wealthy by trading with their colonies, which supplied raw
materials, food and labour to their colonisers. Once these supply lines were established,
European nations could then become manufacturers.
The impacts on the colonies were considerable:
▪ By 1560, Spain had overthrown the powerful Aztec and Inca empires of Central and
South America, gaining land and precious metals
▪ In the Caribbean, profitable sugar cane plantations replaced subsistence food crops
grown for locals. Britain and France controlled most of the Caribbean Islands, using
slaves from Africa to work on the land
▪ In Latin America 7-8 million slaves were brought to Brazil alone between 1550-1850.
The impact on Africa removing millions of young men and women impoverished
formerly wealthy & powerful African empires
A wealthy core and the periphery emerged and the trade patterns between them still
largely survive today (South→North of primary goods and North-South of manufactured
goods and services)
7
, The theory of core and periphery
The theory is used to explain why some countries have become wealthy and others poor. The core is where
most wealth is produced.
Global core areas include North America, Europe and Japan, this core:
• Owns and consumes 80% of global goods and services
• Earns the highest incomes
• Makes most decisions about the global economy e.g. what goods are produced
• Provides most global investment
Meanwhile, the poorer periphery is usually distant from core market. The global periphery of poorer countries:
• Owns and consumes 20% of global good and services, despite having 75% of global population
• Earns low incomes – 2.5 billion live of under $2 per day
• Makes few decisions on the global economy
• Provides little global investment
Recent global shifts mean that:
Manufacturing has fallen in the old core and risen in the ‘new’ peripheral areas because of cheap labour (TNCs
offshoring their production), however core countries profit because they dictate to the new production lines. So
instead of the traditional flows of commodities and raw materials, there are new flows of finished and semi-
finished goods in the periphery, although the decision-making and investment remain in the core.
Two economists came up with a model to show how employment patterns shift and countries change & develop
overtime: The Fisher and Clark Graph
Global patterns and Inequalities in Trade Flows
Trade is the most vital element in the growth of the global economy & development – world trade accounts for
over 30% of GDP
The global economy has grown continuously since the end of WW1 in 1945
Global growth has been accompanied by a change in the pattern of trade, which reflects ongoing changes in the
structure of the global economy
The value of trade in 2003 was less than $8 trillion, in 2013 it is valued at $18.5 trillion
Trade in services has also significantly increased over this period of time from $2 trillion to $4.7 trillion (trade in
services is ¼ of all global trade)
Severe dip of trade in goods 2008-9 indicates the strong effect that the global financial crises had on world trade
China became the worlds biggest trader in 2013 with exports and imports totalling $4160 billion – they recorded
a surplus of 2.8% of GDP – USA are second place but have a huge trade deficit of 4.5% of their GDP, unlike China
Least developed countries share of global merchandise exports totalled only 1.1% where as the G20 had 75.5% -
the overall top 10 traders in merchandise accounted for 52% of world trade in 2013
8
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