THE GLOBAL ECONOMY TODAY

Political map of the world 2008

CENTRE AND PERIPHERIES I. Centre countries 1. Members: the tripolar core (USA, EU, Japan), + Canada, Australia 2. Characteristics: - highly developed economy - high living standards - high educational level - leaders in terms of production and trade - have a decisive role in the development of the global economy - widely used new technologies - outstanding significance of tertiary and quaternary sectors in the economy and in the structure of occupation - great emphasis on research projects - import of raw materials - selling tradables in the market of other countries - owners of TNCs establishing affiliated companies in peripheries - winners of globalization - main countries responsible for endangering the environment - fourth stage of demographic transition - low population growth (low CBR and CDR, low natural increase) - high level of life expectancy

II. Semi-peripheries 1. Members: South Korea, Taiwan, Singapore, Malaysia, Thailand, Indonesia, Philippines, China, India, Russia, Brazil, Argentina III. Peripheries 1.Members: African countries, South- American countries, poor Asian countries

GDP/capita in US$

Adult literacy rate

World Health-Care Status 2002

Countries with the highest GDP figures (millions of US$) World Total69,983,693 European Union17,552,216 1 United States15,094,000 2 China7,318,499 3 Japan5,867,154 4 Germany3,570,556 5 France2,773,032 6 Brazil2,476,652 7 United Kingdom2,431,589 8 Italy2,194,750 9 Russia1,857, India1,847,982

RankCountryPopulation % of world population 1 China1,347,350, % 2 India1,210,193, % 3 United States314,598, % 4 Indonesia237,641, % 5 Brazil193,946, % 6 Pakistan180,973, % 7 Nigeria166,629, % 8 Bangladesh152,518, % 9 Russia143,200, % 10 Japan127,520, % Countries by population

Countries by area RankCountryTotal in km²Land in km² Water in km² % water — World510,072,000148,940,000361,132, Russia17,098,24216,377,742720, Canada9,984,6709,093,507891, United States 9,629,0919,158,960470, China9,596,9619,569,901137, Brazil8,514,8778,459,41755, Australia7,692,0247,682,30058, India3,166,4142,973,193314, Argentina2,780,4002,736,69043, Kazakhstan2,724,9002,699,70025, Algeria2,381,741 00

Vocabulary – Centre and Peripheries living standardéletszínvonal educatedművelt qualifiedképzett culturedkultúrált educational leveliskolázottsági szint literacy írni-olvasni tudás illiteracyanalfabétizmus productiontermelés tradekereskedelem global economyvilággazdaság primary sectorprimer szektor secondary sectorszekunder szektor tertiary sectortercier szektor quaternary sectorkvaterner szektor Research + DevelopmentKutatás + Fejlesztés structure of occupationfoglalkozási szerkezet tradeablesiparcikkek commoditiesárucikkek transnational corporation (TNC) nemzetközi nagyvállalat multinational corporation nemzetközi nagyvállalat affiliatesleányvállalatok centrecentrum peripheryperiféria semi-peripheryfélperiféria globalisationvilágméretűvé válás world marketvilágpiac demographic transitionnépesedési átmenet stageszakasz labour forcemunakerő Crude Birth Rateszületések száma Crude Death Ratehalálozások száma natural increasetermészetes szaporodás population growthnépességnövekedés life expectancyvárható élettartam

INTERNATIONAL ORGANIZATIONS I. UN a, 1945 b, New York c, General Assembly (194 states), Security Council (USA, France, Great Britain, Russia, China), Secretary General, International Court – the Hague, Economical and Social Council (UNICEF, FAO, UNESCO, WHO) A. INSTITUTIONS OF THE GLOBAL ECONOMICAL SYSTEM 1. INTERNATIONAL MONETARY FUND (IMF) a, 1944 b, Washington c, Supervising global monetary system, crediting poor countries on short and middle terms with conditions

2. INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT (WORLD BANK - IBRD) a, 1944 b, Washington c, It credits and assists poor countries on long term. 3. WORLD TRADE ORGANIZATION (GATT) a, 1946 – 1995 b, Geneva c, It supervises international trade with regulations between member states and liberalizes international trade by reducing tariffs II. G20 a, 1975 – 2008 b, shifting semi-annually meetings c, It is a cooperation and consultation forum on matters pertaining the international financial system (e.g.: SDRs) d, finance ministers and central bank governors

III. OECD (Organization for Economic Co-operation and Development) a, 1948 – 1961 – b, Paris c, It was funded to help administer the Marshall Plan by allocating American financial aidand implementing economic programs for the reconstruction of Europe after WW II. Today it’s a forum of 34 countries committed to democracy and the free-market economy, providing a platform to co-ordinate domestic and international policies of its members. d, PISA, coordination of taxation policy, publishing books, reports, statistics IV. EBRD (European Bank for Reconstruction aand Development) a, 1991 b, London c, Its mission was to support the formerly communist countries in the process of establishing their private sector. EBRD provides project financing for banks, industries and businesses, both new ventures and investments in existing companies. It also works with publicly owned companies to support privatisation, restructuring state-owned firms and improvement of municipal services.

III. International Red Cross (IRC) a, 1859 b, Genf c, take care of wounded soldiers, victims of natural catastrophies and famines all over the world IV. NATO (North Atlantic Treaty Organization) a, 1949 b, Brusseles c, Provides protection for member states against enemies V. OPEC (Organization of the Petroleum Exporting Countries) a, 1960 b, Vienna c, Provides coordination of interests of oil-producing countries

Homework Prepare an oral presentation on one of the listed international organizations! Use at least two sources (e.g.: wikipedia and the official webpage of the organization) and prepare a one-sided handout for your classmates covering the most important information on the organization (min. 800 characters without spaces)! Don’t forget to send me the handouts one day before the deadline! Amnesty International, Arab League, Greenpeace, WWF, International Red Cross, Doctors Without Borders, International Monetary Fund, World Bank, World Trade Organization, G20, World Health Organization, UNESCO, UNICEF, Food and Agriculture Organization, World Trade Organization, Interpol, International Council for Game and Wildlife Conservation, Universal Postal Union, Commonwealth of Nations, La Francophonie, Latin Union, Organization of Islamic Cooperation, OPEC, OECD, NATO, International Commission for Standardization, African Wrestling Confederation, International House of Poetry, International Guild of Knot-Tyers, United Grand Lodge of England

Vocabulary – International Organizations United NationsEgyesült Nemzetek Szervezete General AssemblyKözgyűlés Security CouncilBiztonsági Tanács deliberativetanácskozó Secretary GeneralFőtitkár International CourtNemzetközi Bíróság International Monetary Fund Nemzetközi Valutaalap constraintsmegszorítás restrictionkorlátozás wage-cutbércsökkentés immobilizebefagyaszt tax increaseadóemelés public expenditureállami kiadások cut back, reducecsökkent monetary systempénzügyi rendszer financial systempénzügyi rendszer credithitelez on short termrövid távon semi-annuallyfélévenkénti cooperateegyüttműködik consulttanácskozik pertainvonatkozik financepénzügyminiszter central bank governorközponti bank elnöke foreign exchangedeviza foreign exchange reservedevizatartalék SDRs Special Drawing Rights Különleges Lehívási Jogok (nemzetközi fizetőeszköz) International Red Cross Nemzetközi Vöröskereszt victimáldozat natural catastrophytermészeti katasztrófa mass disastertömegszerencsétlenség earthquakeföldrengés floodáradás conflagrationtűzvész tidal waveszökőár galeszélvihar snifterorkán typhoontájfun hurricanehurrikán famineéhínség mutualkölcsönös defencevédekezés Warsaw PactVarsói Szerződés rivalryversengés deterrenceelrettentés Cold Warhidegháború military exercisehadgyakorlat maneuverhadmozdulat

G20

OPEC

NATO

REGIONAL INTEGRATIONS I.The state is the organization exercising power over the population of a given territory. Every state is soverign, i.e. the independence and the area of the country is inviolable. Every state is a subject of the international regulations, e.g. the rules of the UN. II. Regional integrations unite countries with similar economical programme and level of economical development in order to accelerate economical growth and enhance economical competitiveness of members.

II. Factors provoking regional integrations 1. Economical manufactoring of high quality products is possible through - enlarging factories - cooperation of industrial branches - investment in R+D 2. Large markets provide better economical environment 3. Political motivations (economical, military) III. Examples EFTA (European Free Trade Association; Iceland, Norway Liechtenstein, Switzerland) NAFTA (North American Free Trade Association; Canada, USA, Mexico) ASEAN (Association of South East Asian Nations; Philippines, Indonesia, Malaysia, Thailand, Singapore, Brunei, Vietnam, Myanmar, Laos, Cambodia)

III. Main levels of regional integrations 1. Simple Customzone - members provide custom reduction on special products among each other, there is no common customzone (APEC) 2. Free Trade Zone - free trade among members but individual national customs policy (e.g.: EFTA, NAFTA, ASEAN) 3. Customunion - free trade and harmonized trade and customs policy among members 4. Common Market - free trade of products, services, capital and manpower (EAC) 5. Economical Union (EU) - real economical cooperation based on common laws - common economical policy, taxes, investments, money 6. Political Union (USA) - centralized administration (strong central parliament, government and jurisdiction with superior authority), unified army, united foreign affairs, single legitimate flag, anthem

Vocabulary – Regional Integrations maverickszabadúszó freelancerszabadúszó sovereignszuverén, önálló, független inviolablesérthetetlen accelerategyorsít enhancejavít competitivenessversenyképesség provokekivált discountkedvezmény reductioncsökkentés custom, tariff, dutyvám clearancevámkezelés custom unionvámúnió customs policyvámpolitika protectionismprotekcionizmus (védővámrendszer) supranational institutional structurenemzetek feletti intézményrendszer intergovernmental decision-makingkormányközi döntéshozatal associationszövetség organizationszervezet safeguardoltalmaz treatyegyezmény arrangementmegegyezés agreementmegállapodás interactionkölcsönhatás cooperationegyüttműködés collaborationegyüttműködés (kollaboráció) willingnesshajlandóság commitmentelkötelezettség efficiencyhatékonyság productivitytermelékenység deregulationszabályzás-mentesítés economic crisesgazdasági válság frequencygyakoriság intensityerősség social inequalitytársadalmi egyenlőtlenség democratic accountabilitynépuralmi számonkérhetőség necessityszükségszerűség nation-statenemzetállam integrateintegrál irrelevantlényegtelen obsoleteelavult barrierkorlát

GLOBALISATION: PRODUCTION ON GLOBAL SCALE I. Main motives 1. Capital concentration and capital export 2. Production of high value goods on large scale 3. Oil crisis 1973: - growing ambition on reducing expenses - dispersing production: affiliated companies II. Main factors 1. Transnational corporations (TNC) 2. International organizations 3. Consumer society 4. Decreasing importance of nation economies

THE ROLE OF MONEY I. Money is a commonly used unit to measure value. It acquired high importance as exchange of commodities developed. Money has three main functions: - commercial medium - measure of value - medium of hoarding II. Factors reinforcing the role of money 1. Globalisation 2. TNCs 3. International circulation of capital 4. Enhancing communicational techniques III. Monetary world economy: In 1972 the FED abolished the convertibility of USD into gold, and this brought about the separation of production and monetary sector.

IV. Main notions 1. Cash in hand: banknotes and coins 2. Bank account money used in electronical commerce 3. Inflation of the foreign exchange 4. Foreign exchange 5. Currency: means of payment in the international circulation of money (foreign exchange, letter of credit, travel cheque, bank account money) 6. Convertibility 7. Exchange rate 8. Securities: documents authorizing the bearer to raise financial demands on the issuer - government stock: money lent to the government at fixed rate of interest - bond: issued by economical organisations to borrow money for interest - share: a security representing a certain share of and proprietary rights in a company

V. Pillars of the monetary system 1. Money-markets - banks, accounts, deposits, credit, interest rate 2. Capital-markets a, merchandise exchange b, stock exchange (Wall Street, Nasdaq, BUX) - trade of government stocks, bonds, shares - investments into government stock, money- market funds, real estate market - portfolio of shares: balance of venture capital and stable investments

Vocabulary The Role of Money mediumeszköz hoardfelhalmoz convertibilityátválthatóság legal tendertörvényes fizetőeszköz cash in handkészpénz banknotebankjegy coinpénzérme bank account moneybankszámla pénz inflationpénzromlás, felfújás deflationpénzszűke foreign exchangedeviza, valuta currencyfizetőeszköz, pénznem exchange rateárfolyam international cashflownemzetközi pénzforgalom circulationpénzforgalom letter of credithitellevél travel chequeutazási csekk credit cardhitelkártya debit cardbetéti kártya automated teller machineATM securityértékpapír authorizefelhatalmaz bearertulajdonos to raise demandigényt támaszt issuerkibocsátó government stockállampapír bondkötvény share, stockrészvény lendkölcsönad loankölcsönad borrowkölcsön vesz leasebérbe vesz rentbérel hirebérel, alkalmaz, felfogad interest ratekamat money marketpénzpiac accountszámla depositletét capital markettőkepiac merchandise exchangeárutőzsde stock exchangetőzsde portfolio of sharesrészvény portfolió venture capitalkockázati tőke money launderingpénzmosás tax havenadóparadicsom tax fraudadócsalás

Summary I.Most populous countries II.Countries with the largest area III.Countries with the highest GDP figures IV. Main notions: globalisation, regional integration, transnational company, monetary world economy, money, currency, merchandise exchange, stock exchange, government stock, bond, share V. Main levels of regional integrations with examples including member states VI.International organizations VII.The Bretton Woods monetary system