C. Interpreting Information

Work in small groups. Read the questions below. Discuss your answers with your group mates. Give your arguments.

1. What is the history of Airbus Industrie and the Boeing Company?

2. What is the nature of competition between the two companies?

3. Airbus Industrie, a four-nation European consortium, was established in 1970 to challenge U.S. dominance in aerospace. How well has the company accomplished its goals?

D. Discussion

1. Why do Airbus and EC officials believe subsidies for Airbus are necessary and important?

2. Why most Boeing and Us officials opposed to financial backing of the airframe industry by the government?

3. If Boeing were not loosing ground in the global airframe market, would it complain about Airbus subsidies?

4. What advantages might multinational companies enjoy?

5. What industries are subsidized in your country? Do you agree with this policy?

WRITING

Write an essay on Globlilzation. You may use the information from the text.

Multinational Corporations and Globalization: the Pros and Cons

First, let’s define these two terms. A multinational corporation (MNC) is a large company engaged in international production and, usually, sales. The largest MNCs - also known as MNEs, for multinational enterprises – have production sites in several or even dozens of nations. An MNC typically scans the whole world, or at least substantial regions of the world, for markets, production sites, and sources of raw materials.

Globalization essentially means free movement of goods, services, people, and capital across national borders. This creates global markets for goods, services, labor, and capital. However, the term globalization has also come to mean something more: economic and cultural hegemony on the part of industrial enterprises, such as MNCs, and industrialized nations, particularly the United States. Those who oppose globalization use the term to describe these negative phenomena and to raise the specter of a world controlled by a handful of MNCs.

We are discussing MNCs and globalization together because they are related. An MNC benefits from free movement of goods, services, people, and capital across national borders, just as U.S. companies have benefited from that situation in North America. As a corporation, an MNC has one main objective – to make a profit – and the free movement of goods, services, workers, and capital enhances profitability. It does that by giving management freer access to the factors of production and the ability to make decisions based more purely on cost and revenue considerations.

Also, MNCs promote globalization by their very existence and business practices. When McDonald’s introduces its “customer experience” and its menu, even in modified form, to another culture, it begins to change that culture. When Ford sets up an assembly plant in Brazil, it attracts workers from the countryside and changes their economic aspirations, for better or worse. Similarly, the agenda of the World Bank and the IMF generally favour freer trade – a force for globalization – but many developing nations find free trade to be a mixed blessing.

The key problem in talking about MNCs and globalization, aside from the emotions they stir up, is that they are both creatures of the industrialized world. That is an undeniable fact, whether you oppose or support MNCs and globalization. The poorest nations in the world are not launching MNCs. Given that economically powerful entities rarely aim to benefit the poor, those who oppose MNCs and globalization – regardless of how emotionally they state their case – do have a case.