Nationalism vs. Globalization in Taiwan Term Paper

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¶ … press on globalization and its economic impact has focused on the incredible growth of China, Japan and Korea, Taiwan's emergence as a world player almost more dramatic. Once an ostracized island confederation, Taiwan has embraced the power of globalization and allowed itself to become of the growing number of success stories of the East Asian economic region. The question of how globalization emerged within our modern world and specifically within East Asia is a complicated one. It was the result of economic, political, social and cultural circumstances that were all perfectly in tune over the last quarter of a century. The Western conquest of the Asian region through Japan, Korea, Vietnam and other East Asian countries resulted in an influx of foreign capital as well as political and economic reform. It resulted in the forging of free-markets and greater transparency, both factors contributing to the growth in foreign direct investment. Political influences on trade and special privileges were granted to the Asian countries in order to stabilize their countries and that combined with growing need for manufactured products resulted in a booming trade process. The cultural and social values of hard work, nationalism and general adherence to the country's economic direction resulted in a dramatic turn around for the East Asian region. Slowly but surely, the Western nations became dependent upon the East for their productivity, and the escalation of interdependency has only increased in the past year rather than decreased. All of these factors have brought about an "unprecedented unity within this world." Scholars can identify many differing factors for the growth of globalization, including international confederations such as the United States and the IMF; however no single factor can explain the overall growth in interdependence within world powers.

The Asian development process has been heralded by historians and economists as one of the most successful development models within world history. It has led to hundred fold economic growth within the East Asian demographic. The model is a combination of many different economic factors that have resulted in building a system that maximizes Asian strengths while minimizing their weaknesses. At the same time, the East Asian zone has been able to shift along with an evolution within globalization trends. The Asian development process has emphasized growth through several different mechanism. First, it has relied on significant political reforms towards government controlled market expansion. Second, it relies on high stakes investments in education and technology. Third, it has changed its financial transparency and corporate governance to attract greater FDI.

The political shift within the East Asian sector is perhaps the greatest contributor to their growth model. While governments have not completely privatized nor have they created a market economy, they have pursued policies to nurture industrial growth and sustainable infrastructure. East Asian countries have pursued direct interaction between government and the private sector by creating strong lending policies that impact how the industries growth. Governments create an assortment of policies surrounding competition, taxation, workers compensation, etc. that allows creation of environments that are conducive for growth. This is the policy that both Korea and Japan has pursued by directly involving government in the process of decision making and working closely with the private sector. By protecting fledgling industries while still maintaining the freedom to pursue individual growth, industries have flourished within this system. Japan for instance, commands the highest trade surplus in the world, largely by leveraging the strength of their private sector through long-term relationship loans. Similarly the Chinese government has been able to successfully blend governance and free market through protecting certain industries through legislation and keeping certain key industries under government control. Instead of pursuing a "formalized process of results oriented investment. The Chinese government as well as other East Asian countries have pursued 'relationship banking' which focuses more on nurturing long-term growth rather than short-term profitability." The result of their financial, political and industrial process is to free the economy to operate but still protecting their growth.

The second driver of economic growth within this region is a high end investment in education reform and technology growth. East Asian nations on average doubly outpace investment in education than Western countries on a per capita basis. As a result, they have constructed strong technical institutions and devoted following for higher education. Technical university growth has doubled every year within China at minimum, while the same phenomenon is occurring in Singapore and Korea. The result of their core investment is that the nation has seen an insurgence of grassroots technology growth. This has had a dramatic impact the current prospects of the East Asian region as a hub for technology and engineering development. The quality and efficiency of development processes have increased and the core infrastructure of the economy has become much stronger as a result of their technology emphasis. This long-term benefit will sustain their national economy and expand market shares in terms of technology off shoring.

The final driver of the Asian model has been the escalating FDI that is occurring within all nations. Foreign direct investment began in the 1950s when the United States as well as many other European giants gave billions in financial assistance and FDI to developing Asian nations. This influx of capital has allowed these countries to grow and sustain the economy without having to rely on profitability as market standards. East Asian countries have changed their financial infrastructure not only to become more privatized but engage in less cronyism as well as present more accountability. Thus, countries are much more willing to place investment expenditure within the economy rather than providing aid. The net result is that manufacturing industries are booming as are off shoring and off source options for the majority of European transnational. By combining FDI along with a strong economic infrastructure for change, they are fully mobilizing their economy and changing the nature of their economic model to become sustainable in the long-term.

Globalization itself has evolved dramatically over the past two decades. While initially globalization was a small undercurrent process of resource distribution, where East Asian players were able to command much more economic power through global trade, today it has become a dominant theme in international politics and economics. The most evident changes are that globalization has become mainstream and thus, demands on nations are much more taxing on both an economic and political level. Reciprocation of trade agreements as well as demands for increased quality, monitoring, assurance and general fellowship have contributed to growing tension on the global level. The creation of consortiums and unions has also contributed to a greater necessity of political changes and pressures. Globalization has evolved from being a small part of the economic process, to the forefront of modern economic theory and government policy decision making.

The growth of globalization as it engulfs world politics and economic discussions have endangered the East Asian development model. Critics argue that the former "development" oriented infrastructure must be replaced with "neo-liberalism." However, Taiwan has escaped the clash between globalization and the East Asian economic model relatively unscathed. Not only did it weather the regional instability of the late 1990s and its ultimate financial crisis, but it has flourished within established sectors and shown that it is possible to become dominant within global supply chains. The striking ability of Taiwan to have escaped these problems are evidenced in their ability to beat competitors and entrench itself in the global supply chain. The following will explore several factors that have contributed to Taiwan's ability to mitigate the wealth distribution of globalization and continue to outpace projections on national economic growth. However, globalization has still caused problems for Taiwan on many different levels.

Taiwan serves as a semi-periphery on the world stage. While it is not considered an economic powerhouse, it has been able to retain high economic growth and per capita income for its citizens. At the same time, Taiwan experiences a myriad of economic problems that mitigate their success, such as the growth poverty rate as well as rising unemployment. The Kuomintang (KMT), the ruling party of Taiwan until 2000, created a strong economic process to protect Taiwan from economic reliance, but also entrenched itself in the global pipeline. Since Taiwan served as a gateway to China, it became part of the formation of transnational production networks. It focused its economy on high technology as a result; they have been able to negotiate high stakes manufacturing agreements with many Western transnational corporations. Taiwan plays a crucial role within globalization because it becomes a filter for the West into the East. it's reliance upon the United States for economic, political and more importantly, military protection allows it to have a privileged position in accordance with Western superpowers. It serves as a functional portal to the east that transnational corporations as well as the United States can leverage to gain influence within the East Asian region.

The geographical location of Taiwan makes it perfectly situated as a "gateway of East Asia." It shares… [END OF PREVIEW]

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Nationalism vs. Globalization in Taiwan.  (2007, July 6).  Retrieved January 20, 2020, from https://www.essaytown.com/subjects/paper/nationalism-globalization-taiwan/193987

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