The LInk between Globalization and poverty in Kenya

Posted: April 9, 2013 in All Posts

The Globalization is (not) always so good !

By: Konstantsa Karaleeva

Edited by: Natalie Bush

In his movie Globalization is Good, Johan Norberg travels to three countries-Taiwan, Vietnam and Kenya , to show how globalization impacts poor countries and their economies. He draws a parallel between Taiwan and Kenya. Fifteen years ago the two countries had the same rates of poverty. Now Taiwan is fifteen times richer and Kenya remains in poverty. The main reason behind the increase of Taiwan’s economy is the globalization, opening of new markets and establishing international companies and investments in the country. Whereas on the other hand, Kenya failed to open it’s doors for globalization, which led to the country remaining in poverty.

In the movie, Norberg meets with market workers from Kibera, just outside the capital, Naoibi. They are forced to run their shops in extremely bad conditions. If they want to own their land they have to go through nine procedures and wait months. This condition makes it practically impossible for the workers to do so. They do not receive any income from the government and are not able to own their shops and the land for it. This is why they can’t make investments and grow their business. The same problem occurs with the farmers in Kenya. In the movie, there are some additional questions raised. Is it just Kenya shutting its doors to globalization or are the big global forces (EU and the USA) preventing small countries from developing by not allowing them to export their goods? These larger, more dominant countries are making even more restrictions for small countries. To some extent this is because of all the anti-globalization movements as shown in the movie.

Johan Neborg also showed in his film several documents the EU has, full of laws, rules and restrictions for importing agricultural products from Kenya. These conditions and the competitiveness makes it impossible for Kenya to take advantage of the globalization and start to import products, which could lead to the growth of Kenya’s economy.

However, it is important to note the documentary was created in 2003, 10 years ago. I was wondering what, if any changes to the rates of poverty in Kenya since then have occurred. According to the economy rate from 2012, it was mirror image of this in 2011, but unfortunately it is decreasing instead of increasing. This leads us to the thought that maybe Kenya still fails to utilize globalization for economical growth.

Sources:

blackboard/readings/ on globalization/globalization is good

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Comments
  1. Bob says:

    Konstantsa, the idea that the world is a global village is fancy until you realize the disparities that are deliberated created in international trade relations. I would imagine globalisation, envisioning economic empowerment for all, however, this aspect remains to be seen when it comes to trade relations between developing countries and the West. Without the intention of being cynical, trade relations are designed to keep the status quo of African economies. Take a close look at bilateral and multilateral trading treaties with African countries, for instance AGOA,and the EU import regulations that you noted. No African country has been able to export finished products under these trade arrangements on the grounds that the finished products do no meet standards in the US and EU.( Remember all machinery to finish the products are imported from EU, US). The only products that meet the standards are raw materials. this is what is has been and how its intended to be. The raw material does not fetch high prices as the finished products do, as such the economy spends more on imports and earns less on exports to the same trading partners.

    The economy of Kenya and most african countries hence largely depend on trade with neighboring countries for most of its products and these are usually small markets compared to those in EU and US. Kenya’s economy is the largest in East Africa, because of its strategic sea ports that make it a gateway to shipments for all the land locked countries in the Region.

    When you talk about poverty, the question that come to my mind are , what do you consider to come to the conclusion that a country suffers poverty? I dont think you are poor when you have all that other traders want and would cut throats for…I you are a market, a food basket, you have discovered oil. I fear though, if the measure is by wall street kenya is poor. Comparative studies, though good do not carry credibility, especially where salient features of a countries economy are not considered necessary or given its due weight. I will not talk about Taiwan.

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