Globalization and the Good and the Bad Effect It Brings to the Economy and the Employment in Sri Lanka Essay

IntroductionThis assignment is dvirtuoso on Globalization and the good and the bad motion it brings to the economy and the employment in Sri Lanka. Main Date Source used was Wikipedia to gain the data of gross domestic product, GDP per capita assesss, unemployment rate, import & export rates etc. formation of the terms economy, employment in the formal sector and folksy sector is d unrivaled to give meaning to the assignment. The economy and its structural changes and the contribution to the economy and affinity with an opposite country is done. The country that has been taken into consideration as the comparison is capital of capital of capital of capital of Singapore. The reasons to comp atomic number 18 with Singapore is that it has high rate of GDP per capita, GDP, export & income rates etc and it is a world leader in several economic areas.Economy & Employment in Sri LankaAn Economy consists of the economic corpse of a country or different area the labour, capital, and land resources and the manufacturing, product, trade, distribution, and consumption of goods and services of that area. A given economy is the result of a process that involvesits technological evolution, history and social organization, as salutary as its geography, natural resource endowment, and ecology, as main factors. These factors give context, content, and set the conditions and parameters in which an economy functions. Citation WikipediaEmployment is a contract between two parties, one being the employer and the other being the employee. Employment opportunity comes directly from investment (including foreign direct investment and investment bank) to gain excessive profit in a Business plan in the capitalist economy. Citation WikipediaEconomy & Employment in Formal Sector & Informal Sector The informal sector or informal economy is a part of an economy that is non taxed, monitored by either form of government, or included in any gross guinea pig product (GNP), unlike t he formal economy. Other terms used for informal sector can include the black market, shadow economy and the underground economy.The informal economy* Do not chip in any rules or agreements in written form or implied terms. * Exists simply on verbal understanding.* Do not take fixed wages, fixed number of work hours and well-nighly relies on daily earnings where they are unable to do savings. * Sometimes the work purlieu is packed and unclean or untidy. * Socialization process of this sector is very poor when it comes to addressing their difficulties to another party for relief or redress.People working as small traders, home based workers, cobblers, labourers, small farmers and three wheel drivers are some employment belongs to informal sector.The formal economy* Has a structured system of employment with clear rules and regulations, recruitment, agreement and responsibilities of jobs. * Relationship between the Employer and employee is through formal contract where eachparty is bound by the law of the country for any disputes arising. * Employees are required to work for fixed number of hours and receives fixed remuneration with additions to other perks. * Work environment is hygienic and decent.* Entitled to obtain leave, savings, loans etc.* nonionic association or union is available to address grievances. * Covered by social protection such as insurance schemes, pension systems, gratuity etc.People working in the public sector, semi-government sector, clannish sector, government services, banks, universities, colleges, institutes etc belong to the formal sector.Sri Lanka consists of 65,610km2 total land area with a population of 20 one million million with three ethnic groups of Sinhala, Tamil and Muslim.Sri Lanka has 92.5% literacy rate among the total population where youth literacy is 98% and computer literacy rate at 35%. The free education system was established in 1945 providing opportunities from primary to territory stage education. The p ublic universities in Sri Lanka are 15. However, receivable to the gap in the demand and the supply of labour, fresh private institutions have immerged affiliation with other create countries. As a result of globalization, scholars who are unable to enter into public universities get the opportunity to go to other countries on student visa with work permits to earn an extra income during studies. Due to government changes the education system is passing influenced and results in poor structuring leading student to migrate for higher education, sending local funds to another country influencing the economy and increasing the government shortfall.After the independence (1948) the economy structures started to change with a nominal growth but once again due to the riots in 1983 and effects of war, growth came to diminish. In 2009 the war ended creating once again a rapid growth as the fastest growing economies.According to the International Monetary Fund (IMF), the Gross Domestic P roduct (GDP) output is US$ 59.17 billion in 2011. GDP Per Capita PPP is US$ 1,402 in 2011.http//www.tradingeconomics.com/sri-lanka/indicatorsSri Lanka National StatisticsMARKETS withstand former middling pulsation disregard unit type absolute frequency gold 126.75 127.55 109.46 Mar/2013 periodic linear perspective STOCK MARKET 5680.02 5635.90 6010.25 power points Mar/2013 monthly bet GDP termination PREVIOUS modal(a) METER TREND whole compose FREQUENCY GDP PER CAPITA 1402.12 1295.75 602.64 USD declination/2011 periodical aspect GDP PER CAPITA PPP 5619.92 5106.34 2393.29 USD decline/2011 Yearly collect GDP 59.17 49.55 11.40 USD Billion celestial latitude/2011 Yearly View GDP GROWTH RATE 4.80 6.40 6.44 pct family/2012 every quarter View GDP ANNUAL GROWTH RATE 4.80 6.40 6.44 part Sep/2012 Quarterly View GROSS NATIONAL PRODUCT 6470617.00 5534327.00 840878.18 LKR one million million million Jun/2011 Yearly View LABOUR LAST PREVIOUS AVERAGE METER TREND UNIT author FREQUENCY POPULATION 20.87 20.45 15.75 Million Dec/2011 Yearly View UNEMPLOYMENT RATE 4.10 3.90 6.01 Percent Sep/2012 Quarterly View EMPLOYED PERSONS 7430.00 7236.00 6294.82 Thousand PersonsDec/2011 Yearly View UNEMPLOYED PERSONS 308.00 375.00 614.00 Thousand Persons Dec/2011 Yearly View advantage 68.30 68.30 80.41 Index Points Nov/2012 periodical View PRICES LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY INFLATION RATE 9.80 9.80 10.57 Percent Feb/2013 Monthly View CONSUMER PRICE INDEX (CPI) 170.70 170.00 61.98 Index Points Feb/2013 Monthly View trade PRICES 118.70 107.70 80.01 Index Points Aug/2012 Monthly View GDP DEFLATOR 228.46 211.83 168.50 Index Points Jun/2011 Yearly View importee PRICES 133.40 117.60 74.03 Index Points Aug/2012 Monthly View PRODUCER PRICES 220 .21 216.55 56.12 Index Points Feb/2011 Monthly View MONEY LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY INTEREST RATE 7.50 7.50 8.42 Percent Mar/2013 Monthly View FOREIGN EXCHANGE RESERVES 874510.80 845353.30 141026.03 LKR Million Dec/2012 Monthly View INTERBANK RATE 11.41 11.35 11.52 Percent Aug/2012 Monthly View MONEY SUPPLY M0 303095.00 297324.00 50021.34 LKR Million Jul/2012 Monthly View MONEY SUPPLY M1 450049.00 430000.00 118099.84 LKR Million Dec/2012 periodic View MONEY SUPPLY M2 2593185.00 2529800.00 478073.30 LKR Million Dec/2012 Monthly View mess LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY CURRENT ACCOUNT TO GDP -7.80 -2.20 -5.94 Percent Dec/2011 Yearly View parallelism OF TRADE -641.20 -992.90 -972.09 USD Million Dec/2012 Monthly View CURRENT ACCOUNT -126325.90 -189897.00 -33677.92 LKR Million Feb/2012 Quarterly View EXPORTS 871.00 827.60 1578.62 USD Million Dec/2012 Monthly View IMPORTS 1512.20 1820.50 2543.45 USD Million Dec/2012 Monthly View EXTERNAL DEBT 2981500.00 2995800.00 726582.34 LKR Million Sep/2012 Monthly View TERMS OF TRADE 88.90 91.60 112.22 Index Points Aug/2012 Monthly View disposal LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY GOVERNMENT DEBT TO GDP 78.50 81.90 92.63 Percent Dec/2011 Yearly View CREDIT judge 37.50 View GOVERNMENT BUDGET -6.20 -6.90 -7.85 Percent of GDP Dec/2012 Yearly View GOVERNMENT EXTERNAL DEBT 2981500.00 2995800.00 726582.34 LKR Million Sep/2012 Monthly View GOVERNMENT SPENDING 967702.00 872610.00 119258.79 LKR Million Jun/2011 Yearly View logical argument LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY CAPACITY recitation 83.00 82.00 82.00 Percent Jun/2011 Yearly View CAR REGISTRATIONS 1880.00 1718.00 1575.43 Cars Aug/2012 Mont hly View CHANGES IN INVENTORIES 186318.00 93498.00 92964.91 LKR Million Jun/2011 Yearly View HOUSING INDEX 2390.00 2811.00 2817.60 May/2012QUARTERLY View INDUSTRIAL PRODUCTION 0.20 4.10 7.17 Percent Jun/2012 Monthly View CONSUMER LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY BANK loaning RATE 14.30 14.40 13.97 Percent Jan/2013 Monthly View CONSUMER SPENDING 4568393.00 3651578.00 593007.09 LKR Million Jun/2011 Yearly View PERSONAL SAVINGS 15.40 19.30 16.69 Percent Jun/2011 Yearly View Globalization & Sri LankaIn the 20th Century Sri Lanka had a Plantation economy where production and export was cinnamon, rubber and Ceylon tea. Due to the changes implemented on government economic policies and many industries were nationalised do a greater impact on main sectors of the economy. In 1977, Free Market Economy (Liberalization) was introduced to the country adaption of privatization, deregulation and promoting of private enterprises.Production and export of tea, rubber, coffee, dinero and other commodities remains there has been an increase in the industrialization on food processing, textiles, telecommunication and finance. Main economic sectors of the country are tourism, tea export, clothing, rice production and other agricultural products.In addition to theses economic sectors overseas employment contributes hugely to the foreign exchange mainly from the Middle East. Contribution to GDP from services sector is 60%, industrial sector 28% and agriculture sector 12%. The private sector contribution is 85% of the economy.According to home(a) sources, the per capita of Sri Lanka has double since the year 2005 and during the same time period a drop of 15.2% to 7.6% on poverty and a drop of 7.2% to 4.9% of unemployment indicated. 90% of the houses in the country are electrified. 87.3% has access to drinking waterand 39% to pipe borne water. A drop in income inequality is in add ition recognized.After globalization and the liberalization with the improvement on technology Sri Lankas cellular subscriber base increased in 550% growth from 2005 to 2010. Sri Lanka was the 1st country to introduce 3G (third generation), 3.5G HSDPA, 3.75G HSUPA and 4G LTE mobile broad band internet technologies.World economy forum has listed Sri Lanka ranking 52nd in the global warringness also 8th in the World Giving Index in charitable behaviour to the society.Although poverty has fastend to some extent the malnutrition among children still remains in a higher level reporting 29% of the children being under-weight and also a severe percentage being anaemic. Positive impact has occurred after ending of the cruel war towards the road network of Sri Lanka with the help of other countries homosexual capital and technologies. Sri Lanka has 35 A grade highways and 1 controlled access highway (E01)The railway network is operated by the state run national railway operator. The transpose sector has not contributed much to the globalization where there are many difficulties faced facilitating society.There are three deep-water ports at Colombo, Galle and Trincomalee where Trincomalee port is recognized as the 5th largest natural harbour in the world. Newest addition is the port built in Hambatota.Earlier there was only Sri Lankan Airlines and one International airport in the country. But Air transummercateration has expanded to a new stage with the new worldwide air port being built in Mattala, Hambantota and also domestic plane service to Jaffna & Colombo has being restarted with sea plane services eviscerateing tourism to the country. This has helped to create many jobs in the service sector.With a grant of 20 million dollars from the US and assistance from China, a space academy is to be set up for launch of satellites of other nations andas sound as for domestic purpose. On 26th September 2012, Sri Lanka launched its 1st satellite with the intention of more launches in approach years.Even though the national sport in Sri Lanka is volleyball, Cricket has played a major role by rising from underdog status to winning 1996 Cricket World Cup, creating more opportunity to attract foreign investments and other trades to the country.Hence, Globalization has supported to promote economy & employment of Sri Lanka towards a better growth and expansion.Singapore economy towards globalizationRepublic of Singapore is a Southeast Asian country which claimed independence from the British in the year 1963 and was separated from Malaysia two years later. It has a land area of 710km2. full like Sri Lanka it has three ethnic groups, Chinese, Malays and Indians, totalling to population of 5 million. Before independence the GDP per capita of Singapore was US$ 511, this was due to the Suez Canal initiative and being the British Naval Base in the region. After the independence a modern economy was created through foreign direct investments.Today Singapore has a highly developed market base economy and is one of the original Four Asian Tigers. Its economy is known as the freest, innovative, friendliest and most competitive one. Also Singapore is ranked as one of the least corrupted countries in the world.The GDP per capita is USD 33,529.83 in 2011 and GDP is USD 239.7 billion in 2011 according to the attached graph. Singapore claims to be the worlds fourth leading financial centre and its port is one of the five busiest ports in the world. The economy of Singapore depends heavily on exports and purgation imported goods which contributed 26% GDP.When compared to Sri Lanka, Singapore has the third highest per capita income in the world (IMF) where Sri Lanka is placed at the rank of 144 (according to web sources).Transport service in Singapore is mainly by public bus or train. Very limited people have the opportunity to buy vehicles due to the high taxes imposed to reduce traffic in the cities and therefore, cut the waiting tim e and cost of fuel. Singapore has made extensive plans to improve peak hour capacity from 2015 to 2016 by adding more trains and upgrading the signalling systems where the waiting time will be reduced to no more than five minutes.But in Sri Lanka, the expatriate plays a poor role where communities have to go through many difficulties in public transport systems. Because of such problems the Three Wheeler market came to immerge playing a major part in transport systems. Bus services in Sri Lanka are very poor and waiting time is between 15 to 30 minutes in some cases where train services are concerned, the waiting time is much more that the bus services. Railway systems have to be improved vastly to facilitate the transportation in the country where the Government has to seriously take actions in implementation of such plans.Importing goods and services in Singapore is lower than the export rate where in Sri Lanka importing (USD 1,512.20) rate is higher than the exporting USD 871) r ate. Sri Lankan government should impose new laws on imports and provide opportunity for innovations and new products within the country where the deficit could be minimised. Improving exports would facilitate to foreign exchange.Toursim in Singapore is a main attraction and contributes largely to the economy and according to web sources 10.2 million tourists have visited the country in 2007. In 2005, the government leagalized gambling with the idea of attracting more tourist. Singapore is promoting a medical tourism hub with the expectation to serve to serve one million foreign patients annually since foreigners tend to seek more medical care in Singapore.Singapore also functions as an Education Hub where 80,000 international students were account in the year 2006 and it has been increasing ever since.The infrastructure, science and technology plays a main role in Singapore. Internet in Singapore offer residential plans of speeds upto 1Gbit/s increasing exports and creating 80,000 jobs in 2006. Telecommunication include services over 6 million subscribers as sources say.Singapore plays the major role in international transport hub in Asia since it is positioned on many sea and air trade routes. It is recognized as the worlds biggest ship refuelling centre. Even though Singapore is smaller than Sri Lanka, they are consisted with 08 airports in the country with a network of 80 airlines connecting Singapore to 200 cities in 68 countries.SINGAPORE NATIONAL STATISTICSMARKETS LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY STOCK MARKET 3283.85 3269.95 2382.15 Index points Mar/2013 Monthly View GOVERNMENT BOND 10Y 1.56 1.53 3.05 Percent Mar/2013 Monthly View CURRENCY 1.25 1.24 1.71 Mar/2013 Monthly View GDP LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY GDP GROWTH RATE 3.30 -4.60 5.34 Percent Dec/2012 Quarterly View GDP ANNUAL GROWTH RATE 1.50 0.00 4.74 Percent Dec/2012 Quarterly View GDP PER CAPITA 33529.83 32537.76 13907.50 USD Dec/2011 Yearly View GDP PER CAPITA PPP 61103.36 57901.56 28642.70 USD Dec/2011 Yearly View GROSS NATIONAL PRODUCT 341640.90 331346.70 92568.84 SGD Million Jun/2012 Yearly View GDP 239.70 222.70 51.84 USD Billion Dec/2011 YearlyView LABOUR LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY POPULATION 5.18 5.08 3.02 Million Dec/2011 Yearly View EMPLOYED PERSONS 3358.10 3228.50 2441.83 Thousand Persons Dec/2012 Yearly View JOB VACANCIES 56400.00 47300.00 33332.61 Jobs Aug/2012 Quarterly View LABOUR cost 129.90 111.47 96.48 Index Points Nov/2012 Quarterly View PRODUCTIVITY -2.50 -3.80 2.26 Percent Nov/2012 Quarterly View UNEMPLOYED PERSONS 87.10 87.40 57.91 Thousand Persons Jun/2012 Yearly View WAGES 4773.00 4078.00 2943.95 SGD Nov/2012 Quarterly View WAGES IN MANUFACTURING 4903.00 4057.00 4354.69 SGD Nov/2012 Quarterly View UNEMPLOYMENT RATE 1.80 1.90 2.53 Percent Dec/2012 Quarterly View PRICES LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY CORE INFLATION RATE 0.20 -0.70 0.54 Percent Aug/2012 Monthly View INFLATION RATE 3.60 4.30 2.82 Percent Jan/2013 Monthly View CONSUMER PRICE INDEX (CPI) 115.40 115.18 66.45 Index Points Jan/2013 Monthly View CORE CONSUMER PRICES 113.11 113.07 92.60 Index Points Jan/2013 Monthly View EXPORT PRICES 97.07 96.01 126.74 Index Points Jan/2013 Monthly View GDP DEFLATOR 115.53 112.22 86.86 Index Points Nov/2012 Quarterly View IMPORT PRICES 97.50 96.16 95.82 Index Points Jan/2013 Monthly View PRODUCER PRICES 104.79 102.60 91.24 Index Points Jan/2013 Monthly View MONEY LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY INTEREST RATE 0.04 0.05 1.69 Percent Feb/2013 Monthly View FOREIGN EXCHANGE RESERVES 320732.80 320506.30 96071.84 SGD Million Feb/2013 Monthly View INTERBANK RATE 0.38 0.38 2.66 Percent Feb/2013 Monthly View LOANS TO PRIVATE SECTOR 290789.90 284237.50 149869.88 SGD Million Jan/2013 Monthly View MONEY SUPPLY M0 27479.40 26361.30 9284.27 SGD Million Jan/2013 Monthly View MONEY SUPPLY M1 144981.00 140709.10 27659.49 SGD Million Jan/2013 MONTHLY View MONEY SUPPLY M2 484447.30 475392.50 126823.47 SGD Million Jan/2013 Monthly View MONEY SUPPLY M3 495021.70 485915.40 138597.08 SGD Million Jan/2013 Monthly View TRADE LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY EXPORTS 42963079.00 42836030.00 17413779.37 Thousand SGD Jan/2013 Monthly View CURRENT ACCOUNT TO GDP 21.90 24.40 10.91 Percent Dec/2011 Yearly View CURRENT ACCOUNT 12814.60 16976.50 7104.59 Million SGD Nov/2012 Quarterly View IMPORTS 39705603.00 37883528.00 17625168.62 Thousand SGD Jan/2013 Monthly View EXTERNAL DEBT 0.00 0.00 8.86 SGD Million Dec/2012 Quarterly View TERMS OF TRADE 99.56 99.84 128.66 Index Points Jan/2013Monthly View BALANCE OF TRADE 4687576.40 3736394.50 -204106.69 Thousand SGD Jan/2013 Monthly View GOVERNMENT LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY CREDIT RATING 98.60 View GOVERNMENT DEBT TO GDP 100.80 101.20 84.89 Percent Dec/2011 Yearly View GOVERNMENT EXTERNAL DEBT 0.00 0.00 8.86 SGD Million Dec/2012 Quarterly View GOVERNMENT SPENDING 6910.30 7204.70 3226.73 SGD Million Nov/2012 Quarterly View GOVERNMENT BUDGET 0.70 0.30 9.94 Percent of GDP Dec/2011 Yearly View BUSINESS LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY INDUSTRIAL PRODUCTION -0.40 1.30 6.49 Percent Jan/2013 Monthly View BANKRUPTCIES 149.00 195.00 238.14 Companies Dec/2012 Monthly View BUSINESS CONFIDENCE -10.00 -10.00 10.93 Feb/2013 Quarterly View CAR REGISTRATIONS 4273.00 3803.00 6751.17 Cars Jan/2013 Monthly View CHANGES IN INVENTORIES 5770.70 1036.60 380.44 SGD Million Nov/2012 Quarterly View CONSUMER LAST PREVIOUS AVERAGE METER TREND UNIT REFERENCE FREQUENCY RETAIL SALES MOM 2.10 -0.22 0.63 Percent Dec/2012 Monthly View RETAIL SALES YOY -1.50 -1.20 3.18 Percent Dec/2012 Monthly View BANK LENDING RATE 5.38 5.38 6.79 Percent Feb/2013 Monthly View CONSUMER SPENDING 27426.10 27008.00 13037.62 SGD MillionNov/2012 Quarterly ViewImpact on economy and employment due to globalization* Free trade can speed up production and labour costs including higher wages for skills, new technologies, expertise services etc. To level up with the globalized economy, more skills, knowledge, training and development have to given to the work force where they will be developed further and could attract the international job market. But at the same time it consists of a high cost to train the workforce and be competitive at the same time and retaining the trained people.* Globalization promotes employment opportunities towards international market where wealthy companies can profit and bring failure to smaller companies due to the inability to compete globally. In one way it creates multinational firm to expand more making them part of the globalization economy while opening room for the smaller companies to withdraw from the international trade.* The urgency to compete may lead to over use of natural resources to meet higher demands in the production process.* Due to globalization, Internet services have been extended in many ways to access many sites where youth in Sri Lanka nowadays spend most of their time in internet cafes with sighting illegal/improper web sites causing brain damage if engaged in a longer period. sensation programs should be held and laws to be imposed to block such sites as illegal may lead Sri Lanka to a corruption free country to at least some extent. Rather the use of internet can contribute to enhance educational knowledge in a major way due to the smooth access.Yet, Sri Lanka has the potential to create more jobs in the software and the tourism industry as many youth in the country plays an idle time awaiting their ripe(p) Level examination results. Some drop out during university education trying to find jobs. According to the Labour Force Survey (2ndquarter 2012) youth unemployment has a evidential raiseCompared to Singapore, Sri Lanka, having the resources and the intellectual human capital is enriched with new innovations, researches and business investments to promote employment and economy through globalization and gradually receive better results in the coming years.