Globalisation is the breakdown of man-made and natural barriers to the movement of labour, investment, technology, finance and trade, allowing an increase of cross-border transactions, free trade within a region or group. Globalisation occurs when world leaders sign trade agreements and joins trading block as it is believed globalisation brings benefits within a nation. International bodies such as the World trade organization (WTO) have facilitated globalisation by reducing trade barriers and the deregulation of world financial markets. With the drive of globalisation it has resulted in greater economic growth globally. But in reality globalisation has its positive and negative effects on a country’s economic growth and quality of life.
It is difficult to categorize if an economy has been globalised, yet there a several indicators that suggest economic management decisions undertaken by government’s resulting to globalisation. The evidence suggest the globalisation of nations has been the growth in global markets, changes in global consumption and resource use patterns, and establishment of international agreements as well as the rise in transnational corporation (TNC’s). Globalisation has been driven by the breaking down of economic barriers between nations over decades that have resulted in greater worldwide economic growth. This economic liberalization has been pushed on by the trend towards the deregulation of national economies, as well as to encourage greater competitiveness with the global markets. As a result of these microeconomic reforms, globally, there has been reduction of restriction on trade, capital flows and foreign investments. In addition, technological advancements of the last century have contributed to the economic liberalisation, where as a result of technology growth, transport cost reducing dramatically, making trade more cost-efficient.