Impact Of Globalization On The Economy

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Introduction- Globalisation is the process in which economies from around the world become linked through financial integration. Indonesia is located in South East Asia and is emerging into the global economy as an economic powerhouse. Globalisation has had profound impacts on the Indonesian economy and has sparked great change within it. The essence of globalisation means that all economic activity effects and impacts on other economies, e.g. the GFC in America effected all economies throughout the world. To develop its economy, Indonesia has had to make use of macroeconomic policies and trading blocs. During this process, Indonesia has reeked many advantages associated with globalisation, however it has also felt negative effects from…show more content…
Figure 1. Quality of life- Despite the obvious economic growth being experienced in Indonesia, the quality for life still remains sub-par, with around 12% of Indonesians still living in poverty. As Indonesia becomes a more prominent figure in the globalisation, it seems that its GDP becomes less evenly spread, as the majority of its wealth is gained through exporting which is then shared among only a select few. Indonesia’s uneven distribution of income reflects its HDI of around 0.68, with an income of 3,475.25 USD per capita and with only 75% of Indonesia’s population having access to electricity. This considers the education levels of Indonesians which is very low, with an average of 5.8 years of schooling per person and an average female population with secondary education or greater of 36% and 46% for males. Figure2 Shows the increasing rates of education in Indonesia which are relatively low in comparison to other countries. This reflects the workforce of Indonesia which is predominately involved in production and agriculture which are labour intensive and not tertiary or specialised jobs which require a good education. Figure 2. Employment- Due to the increased international demand for the Indonesian exports derived from the forces of globalisation, the Indonesian workforce has increased considerably to fill the void of demands. The resulting drop in unemployment,
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