Benefit Of Globalization In The Philippines

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Consider the cases of Coca-Cola and Pepsi-Cola, which are globally standardized products sold everywhere and welcomed by everyone. Both successfully cross multitudes of national, regional, and ethnic taste buds trained to a variety of deeply ingrained local preferences of taste, flavor, consistency, effervescence, and aftertaste. Everywhere both sell well. Cigarettes, too, especially American-made, make year-to-year global inroads on territories previously held in the firm grip of other, mostly local, blends. These are not exceptional examples. Indeed their global reach would be even greater were it not for artificial trade barriers. They exemplify a general drift toward the homogenization of the world and how companies distribute, finance, and price products.

The products and methods of the industrialized world play a single tune for all the world, and all the world eagerly dances to it. Ancient differences in national tastes or modes of doing business disappear. The commonality of preference leads inescapably to the standardization of products, manufacturing, and the institutions of trade and commerce. Small nation-based markets transmogrify and expand. Success in world competition turns on efficiency in production, distribution, marketing, and management, and inevitably becomes focused on price. The most effective world competitors incorporate superior quality and reliability into their cost structures. They sell in all national markets the same kind of products sold at home or in their largest export market.

They compete on the basis of appropriate value—the best combinations of price, quality, reliability, and delivery for products that are globally identical with respect to design, function, and even fashion. That, and little else, explains the surging success of Japanese companies dealing worldwide in a vast variety of products—both tangible products like steel, cars, motorcycles, hi-fi equipment, farm machinery, robots, microprocessors, carbon fibers, and now even textiles, and intangibles like banking, shipping, general contracting, and soon computer software.

Nor are high-quality and low-cost operations incompatible, as a host of consulting organizations and data engineers argue with vigorous vacuity. The reported data are incomplete, wrongly analyzed, and contradictory. The truth is that low-cost operations are the hallmark of corporate cultures that require and produce quality in all that they do. High quality and low costs are not opposing postures.

They are compatible, twin identities of superior practice. The same is true of Safeway and Southland retail chains operating effectively in the Middle East, and to not only native but also imported populations from Korea, the Philippines, Pakistan, India, Thailand, Britain, and the United States. National rules of the road differ, and so do distribution channels and languages. That translates into a drive for standardization at high quality levels. If a company forces costs and prices down and pushes quality and reliability up—while maintaining reasonable concern for suitability—customers will prefer its world-standardized products. The theory holds at this stage in the evolution of globalization—no matter what conventional market research and even common sense may suggest about different national and regional tastes, preferences, needs, and institutions.

Most important, so have their imitators, including companies from South Korea television sets and heavy construction , Malaysia personal calculators and microcomputers , Brazil auto parts and tools , Colombia apparel , Singapore optical equipment , and, yes, even the United States office copiers, computers, bicycles, castings , Western Europe automatic washing machines , Rumania housewares , Hungary apparel , Yugoslavia furniture , and Israel pagination equipment. They have product lines instead of a single product version, and multiple distribution channels. There are neighborhood, local, regional, ethnic, and institutional differences, even within metropolitan areas.

But although companies customize products for particular market segments, they know that success in a world with homogenized demand requires a search for sales opportunities in similar segments across the globe in order to achieve the economies of scale necessary to compete. Such a search works because a market segment in one country is seldom unique; it has close cousins everywhere precisely because technology has homogenized the globe. Even small local segments have their global equivalents everywhere and become subject to global competition, especially on price. The global competitor will seek constantly to standardize its offering everywhere.

It will digress from this standardization only after exhausting all possibilities to retain it, and will push for reinstatement of standardization whenever digression and divergence have occurred. It will never assume that the customer is a king who knows his own wishes. Trouble increasingly stalks companies that lack clarified global focus and remain inattentive to the economics of simplicity and standardization. The most endangered companies in the rapidly evolving world tend to be those that dominate rather small domestic markets with high value-added products for which there are smaller markets elsewhere.

With transportation costs proportionately low, distant competitors will enter the now-sheltered markets of those companies with goods produced more cheaply under scale-efficient conditions. Global competition spells the end of domestic territoriality, no matter how diminutive the territory may be. When the global producer offers its lower costs internationally, its patronage expands exponentially. It not only reaches into distant markets, but also attracts customers who previously held to local preferences and now capitulate to the attractions of lower prices. The strategy of standardization not only responds to worldwide homogenized markets but also expands those markets with aggressive low pricing.

This is universal—not simply a motivation but actually a need. The difference between the hedgehog and the fox, wrote Sir Isaiah Berlin in distinguishing between Dostoevski and Tolstoy, is that the fox knows a lot about a great many things, but the hedgehog knows everything about one great thing. The multinational corporation knows a lot about a great many countries and congenially adapts to supposed differences. It willingly accepts vestigial national differences, not questioning the possibility of their transformation, not recognizing how the world is ready and eager for the benefit of modernity, especially when the price is right. By contrast, the global corporation knows everything about one great thing.

It knows about the absolute need to be competitive on a worldwide basis as well as nationally and seeks constantly to drive down prices by standardizing what it sells and how it operates. It treats the world as composed of few standardized markets rather than many customized markets. It actively seeks and vigorously works toward global convergence. Its mission is modernity and its mode is price competition, even when it sells top-of-the-line, high-end products. It knows about the one great thing all nations and people have in common: scarcity. Nobody takes scarcity lying down; everyone wants more. This in part explains division of labor and specialization of production. They enable people and nations to optimize their conditions through trade.

The median is usually money. Experience teaches that money has three special qualities: scarcity, difficulty of acquisition, and transience. People understandably treat it with respect. Everyone in the increasingly homogenized world market wants products and features that everybody else wants. The implacable truth of all modern production—whether of tangible or intangible goods—is that large-scale production of standardized items is generally cheaper within a wide range of volume than small-scale production.

But the argument misses the point. For a more detailed discussion, see Exhibit 1. If a company treats the world as one or two distinctive product markets, it can serve the world more economically than if it treats it as three, four, or five product markets. One argument that opposes globalization says that flexible factory automation will enable plants of massive size to change products and product features quickly, without stopping the manufacturing process.

These factories of the future could thus produce broad lines of customized products without sacrificing the scale economies that come from long production runs of standardized items. Economies of scale will not dominate, but rather economies of scope—the ability of either large or small plants to produce great varieties of relatively customized products at remarkably low costs. If that happens, the customers will have no need to abandon special preferences. I will not deny the power of these possibilities.

But possibilities do not make probabilities. There is no conceivable way in which flexible factory automation can achieve the scale economies of a modernized plant dedicated to mass production of standardized lines. The new digitized equipment and process technologies are available to all. Manufacturers with minimal customization and narrow product-line breadth will have costs far below those with more customization and wider lines.

Different cultural preferences, national tastes and standards, and business institutions are vestiges of the past. Some inheritances die gradually; others prosper and expand into mainstream global preferences. So-called ethnic markets are a good example. Chinese food, pita bread, country and western music, pizza, and jazz are everywhere. They are market segments that exist in world-wide proportions. They believe preferences are fixed, not because they are but because of rigid habits of thinking about what actually is.

Most executives in multinational corporations are thoughtlessly accommodating. They falsely presume that marketing means giving customers what they say they want rather than trying to understand exactly what they would like. So the corporations persist with high-cost, customized multinational products and practices instead of pressing hard and pressing properly for global standardization. I do not advocate the systematic disregard of local or national differences. There are, for example, enormous differences among Middle Eastern countries.

Some are socialist, some monarchies, some republics. Some take their legal heritage from the Napoleonic Code, some from the Ottoman Empire, and some from British common law; except for Israel, all are influenced by Islam. Doing business means personalizing the business relationship in an obsessively intimate fashion. A company must almost certainly have a local partner; a local lawyer is required as, say, in New York , and irrevocable letters of credit are essential. Islam is compatible with science and modern times. Barriers to globalization are not confined to the Middle East. The free transfer of technology and data across the boundaries of the European Common Market countries are hampered by legal and financial impediments.

In this connection, I should like to observe that if the Parties to the Convention and the International Undertaking are seriously concerned for the protection of Indigenous ecological and genetic knowledge, they should reflect carefully on the fate of the model folklore provisions. Let us assume, for 'the sake of argument, that World Intellectual Property Organization , Food and Agriculture Organization and other United Nations agencies eventually succeed in adopting a universal definition on Indigenous knowledge; they agree that states should adopt national laws for the protection of Indigenous knowledge; and confirm that national laws for the sui generis protection of Indigenous knowledge are compatible with the Trade-Related Aspects of Intellectual Property's Agreement TRIPs Agreement.

What would be the consequences for Indigenous peoples? First of all, Indigenous peoples would need to convince their national governments to draft and adopt national legislation. That will take some years; at present, such laws exist to the best of my knowledge in Costa Rica, Peru, and the Philippines, although it is gratifying that the Andean Pact countries as a whole are committed to such legislation. The real issue is not the problem of defining Indigenous cultural and intellectual property, nor of agreeing that the heritage of Indigenous peoples, should in principle, be protected by law, like other property. The real issue is enforcement, where disputes routinely cross international frontiers, and generally involve parties with vastly different levels of power, information and financial resources.

Suppose, for example, that a German University professor obtains sensitive information from an Indigenous healer in Brazil, and subsequently obtains a patent or copyright in Germany. How will Indigenous people in Brazil learn about the infringement? Can they afford to take the necessary legal action in Germany? Can they rely on Brazilian state to represent their interests? And assuming that there is a relevant Brazilian legislation, will German courts enforce it? From a practical viewpoint, these are very serious problems which the international community has failed to address until now. But let me return for a moment to the model folklore provisions. As I indicated a moment ago, the model law regards folklore as state property, not as Indigenous people's property.

Not only does it mean that Indigenous peoples must rely on state officials to prevent infringements, and to give them their fair share of any royalties or compensation; it also means that the state determines through legislation, the standards and procedures under which Indigenous peoples may use, learn, and teach their own intellectual heritage. The same state-centered philosophy characterizes the aforesaid Convention on Biological diversity and the proposed revisions of the International Undertaking.

In fact, many State parties to the Convention have adopted access and benefit-sharing laws that are very similar to the model folklore provisions, insofar as the State retains the authority to grant research, access, and use licenses affecting Indigenous peoples and their ancestral territories. I find this approach difficult and worrisome. In my humble opinion, efforts by states and intergovernmental bodies to define Indigenous peoples rights and responsibilities in their own heritage are contrary to the principle of Indigenous self-determination.

It has been my honor, in my capacity as Special Rapporteur of the Sub-Commission on the Promotion and Protection of Human Rights, to elaborate a United Nations study on the Protection of the Heritage of Indigenous People, which has already been published, translated in all official United Nations languages and disseminated all over the world. My principles and guidelines emphasize, inter alia, the authority of Indigenous peoples themselves to license or veto research. The same principles and guidelines also affirm the applicability of customary law, as the ultimate determinant of rights and responsibilities in relation to Indigenous cultural and intellectual property.

The aforesaid guidelines and principles were supplemented and revised by a Seminar organized at the United Nations Office in Geneva from 28 February-1 March Two very distinguished Professors Mary Batista, who is an Indigenous person and Sigrified Wiessner, with deep knowledge of Indigenous issues and particular of the Indigenous aspirations and rights for the protection of Indigenous intellectual and cultural heritage, were chairing two drafting groups of the Seminar, one of the principles and the other on guidelines, which, carefully considered and revised to some extent my text.

The approved principles, guidelines and the relevant report of the Seminar, was duly submitted to the aforesaid Sub-Commission. The Sub-Commission after a proper consideration, adopted it unanimously and transmitted it to the Commission for Human Rights for further action. The World Intellectual Property Organization, has also organized an important seminar on the Protection of Intellectual Property of Indigenous Peoples, in and has meanwhile undertaken a study of customary intellectual property laws, which I believe reflects a more promising direction for future international discussion and action than attempts to negotiate universal substantive standards.

Permit me to refer again to the issue of enforcement, which I believe merits the particular attention of Indigenous representatives and international lawyers who anticipate representing the interest of Indigenous communities. So far, our collective efforts to advance the rights and interests of Indigenous peoples have focused on standard-setting in the field of public international law. We have appealed to the community of states to respect and protect the Indigenous nations and peoples that live within their borders. In the fields of cultural protection and biopiracy, however, the key actors are not states, but private entities such as universities, museums and business corporations - and they are generally headquartered in countries other than the countries where their activities adversely impact Indigenous peoples.

Meanwhile, the underlying consensus-based and state-centered legal paradigm of the United Nations system is gradually yielding to a new paradigm, represented in different ways by the World Trade Organization and the International Criminal Court. Like its predecessor the League of Nations, the United Nations, evolved from particular historical conditions: the disintegration of empires and growth of a much larger, more diverse system of states. Respect for the sovereign equality and independence of states was axiomatic in both the League Covenant and the United Nations Charter. We now live in a more complex political reality: a layer cake of states, regional and international intergovernmental organizations, and, increasingly, federal divisions of power within states.

We also live in a world in which private entities - such as global corporations, private foundations, and even non-governmental organizations - are larger than certain states and enjoy increasingly free mobility. The old principles of sovereign equality and independence are not longer consistent with the world as it is, and gap between theory and reality will continue to grow wider. This is particularly evident in the growth since of international compulsory jurisdiction. Although the UN Charter obliges member States to obey international law, including competent judgments of the World Court, it took more than thirty years to vindicate the authority of UN bodies to pronounce themselves on abuse of human rights and other matters that States insisted were strictly internal matters.

The UN system proper still lacks any meaningful enforcement machinery, short of military intervention, which is plainly a matter of last resort in the most extreme cases. With the establishment of the World Trade Organization dispute settlement mechanism in , however, we have something a little more like an international like an international court that can grant effective remedies to States and industries. Of course the competence of the World Trade Organization is limited to trade, industries and States. The Appellate Body of the World Trade Organization has nevertheless, authorized consideration of "third-party submission" by Non-Governmental Organizations.

Legal distinctions between States and other key actors are weakening, at least with regard to standing, and in principle we should welcome this trend - and insist that standing be available to a broad range of interested non-state parties including Indigenous peoples.