The Big Picture: Major Influences - Dragons and Tigers: A Geography of South, East and Southeast Asia - page 21

global market, thereby reducing their dependency on
developed ones.
Multinational or transnational enterprises play a
vital role in the globalization process. These corpora-
tions control financial, manufacturing, and distribution
systems. Conglomerates with headquarters in North
America, Europe, and Japan are rapidly expanding their
footprints in Asia. Hong Kong is the Asian headquarters
for America' s Walmart, the single largest importer of
Chinese goods. Walmart, the world' s largest corpora-
tion, has more than 600 stores in China and Japan and
opened its first outlet in India in 2009. Carrefour of
France, the world' s largest hypermarket chain, opened a
store in Taiwan in 1989. Now the company has at least
90 hypermarkets in China and Indonesia. Monsanto, an
American agricultural conglomerate, operates in 12
Asian countries. The Finnish company Nokia has its re-
gional headquarters in Singapore and manufactures mo-
bile phones and multimedia products in South Korea
and China. Japan' s advanced technology firm Fujitsu op-
erates in at least 11 Asian countries and has connections
with Germany' s electronics firm Siemens, established in
14 Asian nations from India to the Philippines. More
than 60 foreign IT and telecommunication firms are cur-
rently operating in Pakistan.
T Transnationals are also emerging in other parts of Asia.
South Korea' s Hyundai completed the construction of an
automobile assembly plant in Montgomery , Alabama, in
2005 and Kia opened one in T Troup County , Georgia, in
2006. Tata, India' s largest conglomerate, manufactures
everything from cars to electronics. It has recently opened
metalworks and automobile components plants in China.
Moreover, India now hosts research and development firms
for over 100 international companies. China hosts more
than 750 such centers. Although China invests and builds
primarily in other parts of Asia, it is now heavily involved
in Latin American and African countries. China' s presence
in Africa will be discussed in Chapter 10.
Another feature of globalization is offshoring . Off-
shoring involves the substitution of less costly foreign
labor for domestic labor. It began with the establishment
of call centers in developing countries. For example, an
American dialing a toll-free number causes a phone to
ring in India, or a German sending an e-mail to Microsoft
receives a reply from China.
India offers examples of how offshoring has expanded
in scope in the twenty-first century . Sophisticated com-
puter programs, once written in California' s Silicon V alley ,
are coded in Bengaluru (Bangalore). Medical x-rays, previ-
ously interpreted by doctors in Germany , are now being

analyzed by medics in New Delhi. Bank clerks are crunch-
ing numbers in Mumbai (Bombay) and sending them elec-
tronically to New Y ork. And material for animated movies
is being created in Hyderabad, not Hollywood.
Many Asian countries have jumped onto the off-
shoring bandwagon over the past decade. For instance,
more than 250 foreign companies such as Shell, Cisco,
Ericson, and HSBC have located In Malaysia to provide
offshoring services. The Philippines is host to more than
800 call centers with multiple functions such as telemar-
keting, debt collection, mail ordering, and other cus-
tomer services. This “Sunshine Industry” is one of the
fastest growing sectors of the Philippines' economy . Read
more about this phenomenon in the regional chapters.

WORLD SYSTEMS THEORY
Immanuel Wallerstein, an American sociologist, has pro-
posed a world systems theory in relation to the process
of globalization. He points to a dichotomy of capital and
labor as competing agents reap an endless accumulation
of capital. Corporations seek to maximize profits at the
expense of worker safety , fair compensation, environ-
mental protection, and the integrity and sovereignty of
governments. Further, he argues that there is no Third
World; there is only ONE world connected by a complex
network of economic interchange relationships--that is,
a “world economy” in a “world system.”
According to Wallerstein, this globalization process,
which began in the sixteenth century , has evolved into a
lasting division of the world into core regions, semi-
peripheral regions, and peripheral regions. Clearly ,
rich countries such as the United States, Canada, Aus-
tralia, and Japan comprise the core, and poor ones such
as Laos, Cambodia, and Nepal sit in the periphery . The
core has high levels of technological development and
manufactures complex products. Peripheral regions
supply raw materials and cheap labor for the expansion
of the core.
Economic interchange between core and periphery
takes place on unequal terms. Poor countries are forced
to sell their products at low prices to the core but must
pay high prices for manufactured goods from the core.
Semi-peripheral regions act like a core to the periphery
and as a periphery to the core regions. At the end of the
twentieth century , such countries as China, India, Brazil,
and Mexico had moved from the peripheral to the semi-
peripheral realm. We will revisit cores and peripheries
and examine many aspects of development and its in-
equities in Chapter 4.