The impact of globalization in the economy and its aspects in London
Kingston University Summer School Program 2010 Majd Haddaji
The developments of communication, transportation and the trade have enhanced the integration of the economy. We no more talk about national economy but we talk about global economy. The markets are much moreopen. Many countries have signed conventions to facilitate the trade between each other like the UE. Others even if they had not organized themselves into an economic block, they deal a lot with each other. Foreign direct investment and capital flows are important reason of globalization. Chinese companies are baying companies in the USA, as well as middle east companies are baying or participatingin the capital of European companies. These transfers of capital is facilitating by the stock exchange and the technology. The shares of a British company are sold all over the world. So the ownership is no more local but global. Let’s give an example of the UK to illustrate this idea. Chelsea FC is an English professional group based in London. The owner of the group is a Russian person namedRoman Abramovich. Harrods is an another illustration. It is a British store, one of the largest in UK. It is owned recently by the Royal Qatari Family. Harrods: Harrods is owned by Qatar Investment Authority London’s Harrods is planning to open a store in Shanghai (is still under discussion)1 300,000 visitors per day and Sales in 2001 are 486 Million pounds2 It operates a number of in-store boutiques,in Takashima department store in Singapore for example, and has a number of shops in a number of airports (London, Frankfurt, Hamburg…) Harrods has also other activities like Harrods casino online gambling, Air Harrods…
Chelsea FC: Chelsea FC has a Russian owner; Roman Abramovich, an American chairman; Bruce Buck and an Italian Manager; Carlo Ancelotti. Gross turnover of £248 million(includes Adidas and other merchandise. Chelsea Digital Media is not consolidated in group results), at the end of the financial year June 30, 2008.3 Chelsea FC has a big number of supporters overseas. Chelsea is active in America. They provide tickets for football games in the USA, they negotiate the price of room hotels with hotels while organizing games, and they choose a bar in every city that isrecommended by funs (a meeting point before and after the match)4.
Talking about technology, the internet, the Medias, the transportation and the science progress are all behind this globalization. Many companies are investing in research and development areas. This is very important to companies and their business because it is always behind the creation of new services and products.
1 2The Economic Times 23 Jul 2010. http://www.fundinguniverse.com/company-histories/Harrods-Holdings-Company-History.html 3 http://www.chelseafc.com/page/LatestNews/0,,10268~1555479,00.html 4 http://www.chelseafc.com/page/LatestNews/0,,10268~1730768,00.html
The pharmaceutical sector is a good example in the UK of the development of the R&D field and its impact in the company. To illustrate thisidea, I can give the example of GlaxoSmithKline. It is a British pharmaceutical, Biological, and health care company. Is the fourth largest pharmaceutical company GSK pay a big attention to innovation. They set up a website dedicated to innovation and new ideas collections5 It employs over 100,000 people in 117 countries To accelerate growth they focus in innovations They rely on scientist from allover the world They have many Brands such as Sensodyne, Aquafresh, Polident, Poligrip, Corega
The geographical barriers do no more exist or if they exist, it would be because of the costs. The circulation of the information is very fast. That makes the opportunity easy to hear about but also difficult to be the first to get. London has many famous Newspapers and TV channels. The information...