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Localization in the face of Globalization

The world we live in can seem to be black and white. The foundation behind our subjective perception of the world lies in our objective need to sustain ourselves and ensure that we live to the best of our abilities, in the limited time that we have. From this understanding, the roots of the concept of globalization and localization emerge. In this article, I argue that globalization can be seen as how the rich and privileged perceive and interact with the environment and people around them, while localization is how the poor interact with the same.

Globalization involves the integration of economies through the import of goods and services as well as the merging of the global financial markets. The benefits of globalization are specialization in the production of goods and services, an increase in competition from global competitors which results in an increase in productivity of workers, and a reduction in prices of the goods and services sold. Given the larger market, to ensure they earn profits, companies find efficient ways to use resources as minimally as possible, aiming to reduce the cost of production. There is also a diffusion of new ideas and technologies from all around the world, improving the way we interact with the environment. Examples include technologies to harness wind, solar and hydro energy.

However, as we know, what is said in theory may not work in practice.

With such integration of developed and developing countries, it is hard to imagine that every citizen in the country gets a say in this large market platform. Due to global integration, there is an increase in demand for goods and services, leading to an increasing need for land and resources to meet the demand. To meet this need, large and powerful companies displace local, poor and tribal communities, who lose the land that belongs to them and on which they built their homes. This land is then used for the development of projects, expansion of the industry, etc., and the benefits of these never reach the displaced people. Having once relied on local produce and land, they suddenly find themselves without food and shelter. Increasing demand and industrial agriculture that is introduced due to globalization are making it almost impossible for small and local farmers to survive. Moreover, the farmers lack access to the global markets, preventing them from taking advantage of higher prices, cheaper inputs and better technology. They also lack sufficient access to local markets, inputs and outputs, which are now controlled by multinational companies and face unfair competition from subsidized imports. They are also unable to compete with the large supermarket chains that have arisen through globalization.

The limited inputs and resources, which are controlled by the large firms, tend to be exploited in order to meet the unlimited demand and desires for goods and services created by the larger markets. For example, exploitation of sea urchins spread to several countries with increased globalization. Forests have been stripped down to provide more space for the growth of these globalized industries looking to scale up in cheap and affordable ways. The deforestation of the Amazon rainforest in Brazil is a striking example of the effect of globalization on the environment. The negative impacts of deforestation, vis a vis globalization, include loss of wildlife and their habitat, displacement of local people, soil erosion and an increase in the carbon dioxide levels.

The introduction of industrialized agriculture is a primary contributor to deforestation. Demand for Brazilian soy or beef is now, to a large degree, a factor of demand in the US or China. Trade of goods involving similar amounts of the same goods between countries, creates a crisscross in the world of goods. For example, India imports New Zealand apples and exports Indian apples to New Zealand, creating a trade of the same good. This contributes massively to the increasing carbon dioxide levels, not only through deforestation but also by transportation. Subsidies and deregulation of markets make goods from miles away cheaper than next door.

These environmental impacts and market changes caused by globalization are some of the many reasons for the devastating effects of climate change we face today. If not for the monitoring of the carbon footprint by firms, the green part of the earth would have certainly disappeared. There has been an increasing awareness among young people about the devastating environmental changes we face today, leading to protest movements and a demand for policy changes. An example of such a protest movement is against Adani’s coal mines in Australia, which have devastating environmental effects. If built, the coal mines could potentially destroy ancestral lands, waters and cultures of Indigenous people without their consent. It would also increase the number of coal ships travelling through the Great Barrier Reef World Heritage Area every year for 60 years. The coal mines would also get access to Queensland’s precious groundwater for 60 years for free. This could potentially damage the aquifers of the Great Artesian Basin and add to the carbon pollution. However, sometimes the profit motive of companies beats environmental consciousness.

In an attempt to appease the angry crowd, companies have started sugarcoating their actions with the technology they use and their technological progress towards environmentally friendly means of production, introduced by the global markets flow of ideas and technology. There is a widespread expectation that the use of renewable sources of technology will replace the use of harmful fossil fuels in the future. There is also a trust that there will be innovation of technologies for removing carbon dioxide from the atmosphere and for “geoengineering” the Earth’s climate. The only issue with this fairy-tale is that “technology” is not something that can be created with a wave of a wand. It requires a lot of money, which means claims on labour and resources from other areas. Not many private sector firms are incentivised to spend such resources as it would only increase their cost of production, and not guarantee them a chance of success. Moreover, the money to sustain and materialize this form of technology is hard to find. While in the long run, it will have great benefits for the economy and the environment, the short run benefits might be hard to see. This coupled with the exploitation of the environment further degrades the image of globalization.

One way in which globalization and technology can be beneficial to the environment in the short run, is if the government uses funds and subsidies to incentivise private firms to take up R&D, allowing them to find innovative ways to improve technology and minimize their cost of production in environmentally friendly ways. A form of raising money is through divestment of global activities that are harmful to the environment. Disinvestment in fossil fuels is the most prominent and recent example of political and environment-related disinvestment. In 2011, students on college campuses began demanding that their endowment foundations begin divesting their stakes in fossil fuel companies because they were major carbon polluters. The movement spanned 37 countries and resulted in the divestiture of around $6.2 trillion worth of assets. One thousand institutional investors, including insurance companies, sovereign wealth funds, and pension funds, have committed to divest assets related to fossil fuels.

Thus, the exploitation of resources and the environment by the privileged, through globalization, has increased inequality between the rich and the poor, resulting in the creation of the movement of localization. People who use their resources at a geographically local level, with the inherent limitation of production and marketplace are referred to in the context of localization. These generally include the poorer people and the local, tribal community. While localization is not only for the poor, it has come to be associated as such, because the poorer community lack the means to integrate themselves in the globalized economy, the world now associated with the rich.

The local community is seen as people who work with the environment, simultaneously working to sustain themselves and to preserve it. Since they strive to only sustain themselves and their community, as compared to meeting the global demand, they use the environment to a lesser extent.  In many local communities, it is part of their culture to preserve the environment around them, like with the Ladakhi culture. Previously, this small community used manual labour and whatever little technology they had to produce just enough to feed their community. It was a community of exchange and preservation. They lived closely with nature and the environment around them, consuming only what they could produce and nothing more. Exposure to the outside world and economic pressures that created intense competition, resulted in their breaking down. Connection to nature that had been the cornerstone to the Ladakhi culture all vanished with the introduction of the people to the western world. Their local market could not compete with the global market which was attractive for its lower prices and more variety.

India has a large rural economy, therefore, NGOs  have allowed for the sustenance of the locals and their culture which face competition with the fast-moving globalized world. The Avani Kumaon community, which works in the rural villages in the Himalayan region is such an example of improving on localization through social effort. They are devoted to generating income for local people using only local skills and locally sourced and environmentally friendly materials. Products range from raw natural colorants for cosmetics and pharmaceuticals to eco-friendly art supplies for children to textile printing and dyeing. Each product line is part of a high-quality industry on track to scale and compete in international markets. The cornerstones of their work have been environmental conservation, women’s empowerment, fair trade and preservation of traditional knowledge.

However, the drawback to localization is the lack of efficiency and productivity that comes with less competition, poorer technology and means of income. Their actions and means of production might actually have devastating impacts on the environment, but since they are a small community, they might not realise the impact they create. Their small negative actions might not have short run effects, but in the long run, it can be very harmful to the environment. Some of their negative actions include large scale burning of crops and overgrazing of cattle. Moreover, localization for a small community might work, but the entire population aiming towards localization might not be possible. It will have devastating effects on the environment, with people only focusing on their community and surroundings, not thinking about the overall impact they might create. It could create more strife between people, fueled by an increasing population and access to limited resources within the country. The flow of ideas and technology would be disrupted, affecting the growth and development of the economy.

There is now a movement for the integration of localization and globalization within cities and countries, the creation of a grey area between the black and white. For example, San Francisco, a major global state in the US, has started a number of local farmers markets alongside the large-scale, global supermarkets. This provides people with a choice, and many have started to opt for farmers markets’ fresh and local produce, improving local livelihoods and the environment. The Avani Kumaon community also works side by side with the international markets, trying their best to maintain the equal footing between the rich and the poor. Rural workers gain livelihood through this, maintain their traditions and ensure environmental preservation, but also gain the privileges of the global markets such as a wider consumer base, cheaper prices etc. Zero waste stores are examples of globalized communities but with an aim of minimal environmental impact. Their core values include circular, 100% plastic free, vegan, organic and compostable products. All products are bought in bulk, thus reducing wastage. They promote local products, but compete in global markets.

This move towards a mix between globalization and localization can help bridge the gap between the rich and the poor, thus increasing equality and harmony. The negative impacts of the two will be reduced as they mingle with the positive impacts of each other. It will help keep a check on the growth of the economy, as well as ensure sustainability. 

Shreya Ramchandran is a second-year undergraduate Economics and Finance student at Ashoka University, and a prospective minor in psychology. 

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