Understanding WTO agreements and its structure

WTO’s contribution to world trade is enormous. Countries like India and China must thank the organization to make it possible for these countries to become potentially strong economic force in global business. It is due to the process adopted by WTO which is resulting into the convergence of income levels around the world. In the past many countries has been directly or indirectly benefited from WTO to raise their income level. Perhaps the biggest gainer in recent future is likely to be India. However WTO has been criticized time and again in failing to enforce its sanctions on rich members like US. However one would not accuse WTO for such gaps if one understand how WTO works. The most important pillars of WTO process are its 6 part agreements structure. These agreements are negotiated multilateral agreements which result into rules which must be followed by each member and contribute to the functioning of WTO.

Click here to see a video to understand the nature and categories of these WTO agreements

Digital Cinema Industry Globally and In India

An industry with a 20 years history, is one of the fastest growing business globally. With its initial failure in America, where the idea was originated, the industry made lot of sense for Indian cinema industry and has consistently grown from its first start in India in 2005. Today the market leader in digital films distribution UFO Moviez has 2500 screens country-wide and plan to add 1000 mores in near future.

With the release of films in digital format through satellites, there are inherent advantages of DFD (Digital Films Distribution), which include same day release of a new movie country-wide, quality of screening, easy release of 3D films, reduced costs of distribution and thereby lesser viewing costs. Additionally and theoretically it is also possible to make world-wide release of films with similar benefits. However overseas distribution of digital contents through satellites has numerous practical problems associated with difference in technological advancement and technical standards used for projection of the films, differences in the distributor retailer sharing formula in different countries, differences in copyright laws, differences of opinion about security standards in the system having potential for piracy of the contents etc.

However DCI (digital cinema initiates) are aimed at streamlining several technical and non technical issues related to DFD worldwide. This opens up new avenues for indian films distribution industry for DFD to cover a large portion of India population leaving outside India as well as lot of foreign viewers interested in watching Bollywood productions.

The Globalization Debate

Can globalization be a geo strategy? That is what appears to be when we read reports from experts in US about the ‘behind the scene’ parleys in the presidential teams of the past. After Henry Kissinger’s Tri-Polar World Geostrategy and Bush’s anti EURO geo strategies, subsequent presidents of US has harped on the strategy on globalization.

While some regions of the world have benefitted from such geo strategic initiatives, others have not benefitted and perhaps the humanity as a whole might have suffered damage. Anti – Globalization volunteers talk about the widening gap between the rich and poor countries of the world partly due to the Globalization. They also talk about the deteriorating labor policies like those in China, where global companies have compromised on the human values in their production units, while ensuring their global profits. They argue that global production is motivated by cheap labor, favorable labor policies of the host governments, and more importantly lax environmental laws. The middle classes of the investing countries have also suffered in terms of lost jobs and dwindling pay packages at home.

So who has benefitted from globalization? It is argued that 6.3 % of world population living in US controls 50% of the world wealth. Globalization strategy ensures this control of world wealth is maintained if not improved. US have certainly got richer by globalization, although the wealth is among the richest of the country and may not with the common people. The planet is becoming less habitable by the day contributed by the forces of globalization.

India and China as many other emerging economies also have certainly benefitted from globalization. However this benefit is still to trickle down to the neediest of the population there. Similar benefits have not been seen with most of other poor countries especially in the African continents. Chinese economic incursions in African countries have already been compared with modern form of imperialism, which has not benefited the poor people of Africa. Chinese deals with the dictators of mineral rich African nations, have only benefitted few individuals there.

So how would be the global economy of the deep 21st century? It can not be inferred that global economy would continue to harp on the globalization while criticism to these forces mounts. Russia has in recent times, demonstrated a pull back from these forces of globalization. Others may follow suit. So the global economy of 21st century is likely to be mixed bag of regionalization and certain degree of globalization. Most countries are likely to focus on trade with certain strategic partners with the motivation for secure transactions, convenience, location advantages, favorable political ideologies etc.

Changing Global Business Environment

Example of Soscolo, a place in Italy which has developed into a centre of excellence in the manufacturing of the world’s best ceramic tiles in last 700 years to explain the concept of impact on businesses of the international environment is very handy. While Soscolo accounts for 20% of the world production of ceramic tiles and around 50% of the world exports of the commodity, it is interesting to note that most of its hegemony on the product developed after World War II when most of Europe was devastated in the war. The rebuilding efforts of the aftermath of the war created tremendous demand for the ceramic tiles from Soscolo since it was one of the most suitable places to source this material due to its location, availability of skilled labor for this product and technology availability there. Manufacturers in Soscolo took advantage of this opportunity and refined the technology to make it more efficient requiring less labor. At the same time production capacities increased. Related industries developed and today we have the world’s most excellent centre for this product. Above example of Soscolo of Italy demonstrate how political peace in the region after the war, & Italy being part of the US block, technological changes in the business environment as well as social transformation of the time made a long lasting impact on the foture of the businesses in the city.

Due to this TRIAD effect, all the demand for ceramic tiles went to this place which was strategically located.

The changing political and economic systems is the order of the present international environment where businesses have to adjust and allign with opporutinities and threats resulting from such global changes. One example of this change explained to the students related to increasing democratization of political systems of the world. Notable examples given were of Nicaragua, Chile, Eastern Europe and more recently the Gulf Region where purple revolution is taking place on the medium of Face book led campaigns in favor of democracy and more powers to the common people. Scores of countries are likely to be affect by these changes which may drastically change the political and economic models of countries which are still not ready to accept these Geopolitical Change of Global weather.

It is argued that even China may not remain unaffected by these environment changes and may see eruption of popular sentiments in favor of more power to its subjects and right to choose the people who must govern Chinese economy and its people. India is facing its biggest poltical turmoil where common man is aspring for true democracy and cleaner poltics, against corruption and graft. Led by Anna Hazare, purple revolution seems to have swept India which is as strong as many places in the world.

These changes may continue in  foreseeable future. New understanding of global environment changes must be understood well by globetrotting business executives to help themselves take difficult business decisions, and are important. Some of the other changes relate to technological, financial and cultrual changes. Emergence of a geo culture, geo finance and democratic technological paradigm can bring serious influence the way global business is done. Increasing strengths of ethics groups, environment groups are some of the important changes in world geopolitical environment, which businesses must  learn to comply with and manage.