GLOBALISATION AND INTERNATIONAL TRADE

Teacher’s GuideTopics1. What is money?2. What is currency?3. History of international trade 4. Vocabulary5. Economic systems6. Globalization7. Economic globalisation 8. Political globalisation9. Cultural globalisation10. Pro-globalisation organisations 11. Vocabulary12. World Trade Organisation 13. IMF 14. World Bank15. G7/G816. Anti-globalisation organisations 17. World Vision International 18. Group of 77 19. Why is there global inequality?20. Free trade 21. The money system and the third world debt crisis22. Third world debt – views from the North and the South23. G8 summit and ending Africa’s debt24. Sweatshops25. Nike and Gap26. Fair trade27. What are sanctions?28. Sanctions and Iraq29. Sanctions and South Africa30. Sanctions and Burma31. Tourism

1. What is money?

Tell the students they have three minutes to write down as many currencies as they can think of. They need to write the name of the currency and the country where it is used.

Ask the student with the most currencies to read out his/her list.

1

As a class discuss: Why do we have money? What are the advantages of money? What are the problems with money?

Read ‘What is money?’

Answer these questions:

2. What is currency?

Read ‘What is currency?’ Answer the questions in the reading.

2

Some possible answers: Rupee – India, Kyat – Burma, Baht – Thailand, Ringit – Malaysia, US dollar – America, Pound – UK, Franc – France, Deutschmark – Germany, Yen – Japan, S$ - Singapore, HK$ - Hong Kong, Euro – Europe (note, this is a new currency adopted by many countries in Europe. The franc and the deutschmark are no longer used), Riel – Cambodia, Rupiah – Indonesia, Kip – Lao, Peso – Philippines, Dong – Vietnam

1. What is bartering?2. How does money make trade easier?3. What objects have been used as ‘money’?4. Why would something that is easy to find, such as stones or soil, not

make good ‘money’?

Answers:1. Bartering is when you exchange one type of goods for another. 2. Using money solves the problem of time constraints. Using money

means you can sell products, and buy new products at another time.

3. Rum, cigarettes, gold, pigs, rare seas shells, whales’ teeth, spices and pepper.

4. If you use something as ‘money’ it has to be something that other people want, but cannot easily get. Stones and soil are easy to find, so no one would want to exchange them for goods.

Answers:1. Burma – Kyat, India – Rupee, UK – Pound, Malaysia – Ringit, Thailand – Baht,

USA – Dollar, Japan – Yen, Australia – Dollar.2. Burma about 1000 Kyat, Thailand about 41 Baht, India about 43 Rupees,

Australia about 1.3 Dollars3. Hard currency: Pound, Dollar, Yen Soft currency: Kyat, Rupee, Baht*Note – The official government rate for Burmese Kyat is now 6 Kyat to the

3. History of international trade

Why do we need international trade?In small groups, get the students to think about trade and Burma. Ask them to list all the products Burma can produce itself, and then list all the products it needs to import from other countries.

3

Explain:

Read ‘History of international trade’.Answer these questions:

4. Vocabulary

The words in the vocabulary section are all words that will be used in the next readings.

Divide the class into small groups. Get the students to make a ‘picture dictionary’ of the vocabulary – they have to draw the meanings of the words.

4

Most countries in the world can produce many things that they need, but not everything. Countries with good industry might need to import food; agricultural countries might need to import factory products.

So, international trade means that countries are buying and selling from each other. International trade has taken place for thousands of years. But in recent times, because of improved communications and transportation, international trade has rapidly increased.

International trade is a very big part of globalisation.

Possible answers:Produce itself – rice, oil, vegetables, fruit, clothes, teak etcImport – medicine, MSG, electrical equipment, household supplies, etc

1. What was the first development that led to early trade?2. In what ways was trade made possible for the Roman Empire?3. Which European countries set up big trade companies?4. How did the English East India Company finance its tea trade?5. Why do you think it was difficult for Africans to resist the slave trade?

Answers:1. The first development was learning how to tame and use animals,

such as horses.2. A single currency, Roman roads and naval harbours.3. Portugal, Holland (Dutch) and Britain.4. By growing Opium5. Possible answers – Europeans were very powerful, slaves were

captured, Africans did not understand what was happening, Africans were less developed and unable to fight back.

Don’t let them write the vocabulary next to the drawings.

Get some groups to present their work. Can the rest of the class identify the words from the drawings.

Go through the vocabulary again. Ask students to explain the meanings in their own words.

5. Economic systems

Divide the class into groups. Get the groups to read ‘Economic systems’ and then brainstorm:

5

1. What are advantages and disadvantages of each economic system?2. Which economic system do you think is best? Why?

(*No need to do socialism as this will overlap with ‘centralised economy’ and ‘communism’)

*Encourage the students to think carefully about each system.

Get some groups to present their ideas.

Answer the questions below the reading.

6. Globalisation

Ask the class:

*Encourage the students to think of their own ideas, and not just read from the dictionary

6

Possible answers:1. Capitalism – advantages – economic growth, people become richer and have a better standard of living, countries can develop, people can own their own property, people who work hard will have more benefits etc.

disadvantages – benefits the rich, increases poverty, not sustainable2. Mixed economy – advantages – government has some control over the economy and over businesses, as capitalism

disadvantages – as capitalism3. Centralised economy – advantages – no private sector working for profit, any profits are invested back into the country, government should work for benefit of people whereas private companies work for the benefit of themselves

disadvantages – if government is inefficient goods and services won’t be provided well, government has all the control over the economy4. Communism – advantages – Equality, no difference between rich and poor, sustainable

disadvantages – In reality there is still a division of rich and poor, people cannot improve their lives, people who work harder should be able to have better lives, government has too much control5. Self-sufficient – advantages – Don’t need to depend on other countries for trade, don’t need to negotiate with other countries or follow their rules, less influenced by other countries

disadvantages – less economic growth, no alternatives if there are problems such as crop failure, drought etc.6. Subsistence - advantages – very sustainable, protects the environment

disadvantages – dependent on climate and success of crops, therefore vulnerable to drought, crop failure etc, difficult to protect environment from outside traders, low standard of living, little development.

What is ‘globalisation’?

Write their answers on the board.

Explain:

Explain:

Read ‘Globalisation’.

Brainstorm a list of all the things that could be shared through globalisation.

7. Economic globalisation

Explain:

7

Globalisation has many definitions, and is understood in different ways. For example: The spread of business across the world. The spread of knowledge, technology, English language, western culture, and western ideas. Globalisation is the spread of economic, social and technological ideas and exchange between counties. It is the spread of trade, factories, labour, science, development, culture, language, natural resources, etc.

The definition of globalisation in the reading is:

Globalisation is the rapid increase in economic, social, technological exchange between countries, under conditions of capitalism.

Globalisation that we are experiencing in the world today includes the spread of capitalism.But globalisation, as in the spread of trade, knowledge and technology, could exist without capitalism.So globalisation is often understood in different ways.

Possible answers:Trade of goods – food, agriculture, electrical goods, clothes, snack foodsTechnology, scientific discoveries, medicines, health care knowledge, education, languages, information, world news, different cultures, different ideas, social values, human rights, democracy, natural resources, etc.

Nestle is an example of a multinational corporation. It was formed in 1866.The founder was a man called Henri Nestle, and he developed a food for babies who were unable to breast feed.In 1905 Nestle joined with another company that was based in England and Switzerland. Factories were set up in the US, UK, Germany and Spain.Nestle became bigger and bigger.In the 1920s Nestle began to make chocolate, and in the 1940s it began to produce coffee.Over the years Nestle has bought many other companies, producing different food products and even beauty products and pet foods. These companies were European and American.

Now Nestle is a very powerful, very rich multinational corporation, with companies and factories all over the world. Its products include many well known chocolate bars, Nescafe, Nestea, and coffee mate.

As a class brainstorm:

Read ‘Economic globalisation’Answer these questions:

8. Political globalisation

In groups, ask the students to brainstorm:

8

How many businesses and corporations can you think of that sell their products all over the world?

Possible answers:Coca-cola, HSBC, McDonald’s, Microsoft, Nestle, Nike, Nissan, Nokia, Shell, Colgate, Daewoo, Pepsi, Mitsubishi, Samsung, Toyota, Sony, Dow chemicals, Johnson and Johnson, Enron, etc

1. What is economic globalisation?2. What are multinational corporations?3. Why are MNCs very powerful?4. How can the globalisation of trade help developing countries?5. Why do you think MNCs often do not pay fair wages in developing countries?6. Do you think economic globalisation can encourage the Burmese government to change its behaviour? Why / why not?

How is the political situation in the world today different to the political situation two hundred years ago?

This might be difficult – ask them to think of what they know about history, and to imagine what the situation was like.

Discuss the groups’ ideas.

Read ‘Political globalisation’.

9. Cultural globalisation

Ask the students:

Encourage the students to give their own ideas – not just read definitions from the dictionary.

9

What is culture?

Possible answers:TodayThere is democracy in many countries. Human rights are considered important and universal. The world recognizes countries as areas of land with fixed borders. Leaders should be legally chosen by the people. There is more communication, so people around the world know what is happening in other countries. There are international organisations such as the UN, ASEAN etc.Two hundred years agoDemocracy was in early stages in some countries. There was little consideration for human rights, and they were not universal. Countries were ruled by dictators, Kings, Emperors. Power was inherited. People did not know what was happening in other countries. International organisations did not exist, etc.

Write their answers on the board.

Look at the definition and explanation in the reading ‘Cultural globalisation’.

Divide the class into small groups. Ask the groups to make two brainstorms:

Get one or two groups to present their brainstorms.

Discuss:Do you think your culture has been influenced by western culture? If yes, in what ways?Do you think these influences are good / bad? Why?Do you think that development and globalisation harm or benefit traditional cultures? If yes, in what ways?What do you think is more important, development or preserving traditional cultures? Why?

Read ‘Cultural globalisation’.

Explain:

Ask the students to think about changes in their cultures. Discuss:Do they think the changes to their cultures are because of outside influences, or have come from within their communities?10. Pro-globalisation organisations

As a class brainstorm

10

1. Students’ own culture.2. Everything they know about western culture.

Throughout history cultures around the world have constantly changed and developed. As groups of people come in contact with other groups they learn about new traditions and beliefs, which can influence their own cultures.

Today, cultures around the world are changing very quickly. Many countries are adopting the values of democracy and human rights, and they are rapidly developing.If you visit almost any country in the world you will see people learning English, wearing western clothes, eating western food, watching western movies.

Some people believe that this change is the result of globalisation. It is caused by western culture and values being imposed on the rest of the world.Because of this, the diverse cultures around the world are slowly being lost and everyone is becoming the same.

Other people believe the change is not because of the spread of western culture. Instead they believe it is a natural change that occurs as countries develop. That the changes happen within the country, because the country is developing, is getting more industry, and more of the population is moving to cities.

What types of people, groups or organisations would support globalisation?What types of people, groups or organisations would oppose globalisation?

Note – this brainstorm would reflect students’ opinions, so there are no right or wrong answers.

Read ‘Pro-globalisation organisations’.

Explain:

Discuss:

11. Vocabulary

The vocabulary on this page is words that will be used in the next few readings.Go through each of the words and its meanings.

12. World Trade Organisation13. World Bank14. International Monetary Fund15. G7 and G8

11

Possible answers:SupportBusinessmen, multi-national corporations, governments of western countries, United Nations, many people around the world, etcOpposeEnvironmental organisations, people from subsistence cultures, dictatorships, some religious groups, poor countries, etc

There is a lot of debate about the benefits and problems of globalisation.The list of pro-globalisation organisations is some of the organisations that support globalisation.We’re going to look at some of them in more detail in the next few readings.

Looking at the list of organisations we can see that they are mostly organisations that seek to develop trade and economy.They are also mostly founded and controlled by the world’s richest and most developed countries.

Why do you think that developed countries have more control over pro-globalisation organisations?

Divide the class into four groups. Allocate one of the organisations above to each group.

Tell the students they need to make a presentation about their organisation, to explain it to the rest of the class, in their own words – they cannot copy from the readings.

To prepare the presentation they need to make a diagram on butcher paper. Remind them that they need to explain their information clearly to the rest of the class.

One student from each group then needs to present their organisation. Tell the class that you are going to ask them questions about the presentation so they need to listen carefully.

After each presentation ask the class feedback questions. Recap the main points from each presentation.

Get the students to make a table summarizing each organisation:

Name oforganisation

When was it set up? Who are the members?

Why was it set up?

Answers:

Name oforganisation

When was itset up?

Who are the members?

Why was it set up?

World TradeOrganisation

1995 148 countries who have signed WTO agreements on world trade

To help trade flow smoothly, freely and fairly.

World Bank 1944 184 member countries.40 rich countries provide money

Provides loans, advice and assistance to improve living standards in poor countries.

International Monetary Fund

1945 184 member countries Promote money systems between countries, economic growth, etc

G7 and G8 1975 Canada, France, Germany, Italy, Japan, the United Kingdom, the United States and Russia.

Summits / meetings between the world’s most industrialized countries.Students’ ideas.

16. Anti-globalisation organisations

Read ‘Anti-globalisation organisations’.

Explain

12

The organisations that oppose globalisation are very different to those that support it.In the reading there are organisations that oppose globalisation for a number of reasons:Environmental reasonsPoverty and the need for developmentThe imbalance between rich and poor countries

These organisations don’t usually oppose all forms of globalisation, and they do recognize the benefits of sharing knowledge, development and trade. But they have many concerns about the process of globalisation happening around the world at present.They feel that globalisation today is not fair, and mostly benefits the wealthy countries of the world.They are also concerned about the harm that is being done to the environment.

Often it is capitalist globalisation, rather than globalisation itself, that is opposed.

17. World Vision18. Group of 77

Divide the class into four groups. Allocate World Vision to two groups, and Group of 77 to the other two.

13

Tell the students they need to make a presentation about their organisation, to explain it to the rest of the class, in their own words – they cannot copy from the readings.

To prepare the presentation they need to make a diagram on butcher paper. Remind them that they need to explain their information clearly to the rest of the class.

One student from each group then needs to present what their organisation. Tell the class that you are going to ask them questions about the presentation so they need to listen carefully.

After each presentation ask the class feedback questions. Recap the main points from each presentation.

19. Global inequality, is it getting worse?

Explain:

14

A lot of debate surrounding globalisation is based on the effect of globalisation on poverty.Pro-globalisation organisations claim that globalisation and increasing free international trade reduce poverty and improve standards of living.Anti-globalisation organisations claim that globalisation and increasing free international trade increase poverty, and widen the gap between rich and poor.

Both sides provide evidence in the form of reports and statistics to support their arguments.

Read ‘Global inequality, is it getting worse?’

Divide the class into four groups. Tell two of the groups they are pro-globalisation, and the other two are anti-globalisation.

Get the groups to brainstorm all the reasons they can’t think of to support the argument either for or against globalisation.Encourage them to look back at what they have been reading to get ideas, and to include their own ideas.

Talk for one minuteTell the students to imagine that they are speakers supporting or opposing globalisation, and they have to convince the rest of the class to agree with their view.Select students at random. They have to talk for one minute, to support or oppose globalisation:E.g. Globalisation is beneficial because…

Globalisation causes problems because…

Discuss:Which speaker was most convincing?What is your opinion of globalisation? Do you think globalisation is a good thing or a bad thing? Why / why not?

20. Free trade

Explain:

15

Often when businesses want to trade in other countries, the governments of the countries ask the businesses to pay taxes, or to obtain import or export licenses.

Import license – a license giving a business permission to bring goods into a country.Export license – a license giving a business permission to send goods out of a country.

These taxes and licenses make international trade more complicated.

Free trade is the idea that businesses should be able to trade with other countries without having to obtain licenses or pay taxes.

Many countries and regions around the world are forming free trade agreements;

Read ‘Free trade’.In your own language, write down the meanings of:

*Note - Make sure students realize that market has many meanings:1. A place where people buy and sell goods.2. Trade of goods and demand for goods.

In this module, market has the second meaning.

Divide the class into small groups. Get half of the groups to produce a poster promoting free trade. Get the rest of the groups to produce a poster opposing free trade.

Get some groups to present their posters.

21. The Money System and the Third World Debt Crisis

Read ‘The money system and the third world debt crisis’.Answer these questions:

16

1. trade barrier2. agricultural subsidy3. import license4. export license5. free trade

1. How do banks make their money?2. How much money did developing countries owe by 1994?3. How does repaying third world debt affect countries in Africa?4. Why did the size of the third world debts grow very quickly?5. Why can third world debts lead to harm to the environment?6. What currencies must third world debts be repaid in?

Explain:

Get the students to work in pairs to solve these problems:

1. You want to buy a car. The price of the car is 200,000 rupees. You only have 50,000 rupees. The bank has agreed to lend you the extra money. You have to repay money to the bank every month for four years. You have to repay 3,800 rupees every month. How much extra money do you have to pay?

17

Answers:1. By charging interest – extra money that must be paid for

borrowing money.2. Two trillion US dollars.3. It causes hardship. The countries cannot afford to spend enough

money on health care, education etc.4. There were many changes in the world economy.5. Countries that owe debts misuse their natural resources in order

to repay their debts.6. Hard currencies.

Changes in the world economy have had a big effect on third world debt.

For example:Loans given to poor countries are given in hard currencies – US dollar, yen etc. The values of these currencies do not change much.Loans also have to be repaid in hard currencies.

Most poor currencies have soft currencies. If the value of a poor country’s currency goes down, then much more of the currency has to be used to pay off debts in hard currencies. And debts become harder to pay off.

Answer: You borrow 200,000 minus 50,000 = 150,000 from the bank. You repay 3,800 rupees every month for four years: 3,800 x 12 x 4 = 182,400.Extra money = 182,400 – 150,000 = 32,400 rupees.

2. You are the government of a small, developing country. A developed country offers to lend you fifty million dollars (50,000,000) to develop your industry. Your country has to repay six million dollars every year for ten years. How much extra money do you have to repay?

Answer: 6,000,000 x 10 = 60,000,000Extra money = 60,000,000 – 50,000,000 = $10,000,000.

After two years your industry is struggling. Another country lends you 20,000,000 dollars to further develop your industry. This money has to be repaid at 3,000,000 dollars a year over eight years. How much extra money do you have to repay altogether?

Answer: Second loan – 3,000,000 x 8 = 24,000,000Extra money = 24,000,000 – 20,000,000 = 4,000,000Total extra money = 4,000,000 = 10,000,000 = 14,000,000

3. Your country has a water crisis. A rich country offers you one billion dollars (1,000,000,000) to build three dams. To repay the debt your country must pay interest at a rate of 5% per annum. You have to repay the debt at $100,000,000 per year. How much do you still owe after one year?

5% of 1,000,000,000 = 50,000,000Repaid = 100,000,000Amount still owing = $950,000,000

How much have you repaid after 3 years?

$300,000,000

How much do you still owe after three years?

Second year: Third year:Amount owing = 950,000,000 Amount owing = 897,500,0005% of 950,000,000 = 47,500,000 5% of 897,500,000 = 44,875,000Total owing = 997,500,000 Total owing = 942,375,000Repaid = 100,000,000 Repaid = 100,000,000Still owing = 897,500,000 Still owing = $842,375,000

22. Third world debt – views from the North and the South

Read ‘Third World Debt - a view from the North and the South’.Get the students to write six questions of their own.

18

Explain:

23. The G8 summit and ending Africa’s debt

Read ‘The G8 summit and ending Africa’s debt’.

Complete these sentences:

24. What are sweatshops?

Divide the class into small groups. Get each group to plot the route of coffee or clothes from the producers in the developing country to the consumers in the rich country. What work is involved? Who does the work?

19

Possible answers:CoffeeFarmer / pickers / driers / lorry / (factory) packers / lorry / ship / lorry / warehouse/ lorry / shop / purchaserClothesCotton farm / pickers / spin thread / dye thread / (Factory) weaving / lorry / (factory) making clothes / lorry / ship / lorry / (warehouse) contractor / lorry / shop / purchaser

In the past, poor countries borrowed a lot of money for development.Often the money was not used successfully.There are a number of reasons for this, including:- Development projects did not bring the results hoped for.- Poor countries had to set up projects planned by developed countries, which were not appropriate for the country.- Corrupt governments misused the money.- Governments used the money to oppress the people.

In addition to this, the changes in the world economy – such as changes in currency exchange rates and the devaluation of soft currencies - caused debts to increase.

So, should these debts be forgotten?

1. The 2005 G8 summit was held in Scotland because…2. The issues addressed in the summit were…3. Campaigners and some African organisations felt the world leaders decisions were…4. Trade justice means…5. The 18 African countries whose debts were cancelled had previously…6. The United Nations target for aid is…7. Giving better aid means…

Answers:1. the United Kingdom held presidency of the G8.2. trade justice, drop the debt, more and better aid, HIV/AIDS, and global warming.3. too little and too slow.4. rules of trade that allow all countries to benefit equally and fairly from world trade.5. opened their markets to the free trade system.6. that rich countries should give 0.7% of their gross national income.7. making sure aid money is spent in the right way; allowing poor countries to plan how to use their aid; giving money without conditionality.

Explain:

Ask: What are sweatshops?

Read: What are Sweatshops?Answer true or false to these statements:

Explain:

20

Imagine a shirt in a shop in the UK may cost 40pounds (US$60) to buy. The worker in the factory might receive less than 50 cents for making the shirt. Where does the rest of the money go?Money would go to all the different workers, but a lot of money would be profit for the clothes company that ordered the shirt to be madeExamples of well known clothes companies are Nike, Levis, Gap.

In the past contractors would get products made in the country where they are based.But today many contractors get their products made in developing countries.

Possible answersPlaces where people have to work very hard, little pay, long hours, not enough food or water, unfair treatment by bosses, risk beatings or rape, human rights are violated, unsafe conditions, child labour, etc.

1. Factories that respect labour laws are called sweatshops.2. Workers in sweatshops work very hard, for low pay.3. The living wage is the lowest amount of money an employer can legally pay.4. Factory owners can tell the western businesses how much they must pay to have their products made.5. Workers will often lose their jobs if they demand better conditions or pay.6. Providing work for women helps to improve their lives.7. Western countries have laws to protect workers’ rights, but many developing countries do not.8. Western businesses cannot afford to pay higher wages to workers in developing countries

Answers:1. false 2. true 3. false 4. false5. true 6. true 7. true 8. false

25. Nike and gap

Explain:

21

It is often cheaper for businesses to get their goods produced in developing countries. This is because they have less expenses and can pay lower salaries.Because of this, many businesses are closing their factories in developed countries, and moving production to poorer countries.

One example is the clothes company Levi.Levi closed their clothes factory in the US and made 10,000 people jobless.Then Levi moved its factories to the developing world.

Sweat shops in Mexico:There are a lot of sweatshop factories in Mexico, along the border with the US.

After the North American Free Trade Agreement (NAFTA) was signed by the US, Canada and Mexico - which allows unrestricted trade and investment between these countries - the number of sweatshops increased.

Pay and working conditions in Mexico sweatshops are terrible.Workers work long shifts, and must work longer for no pay, if they don’t make enough clothes.Girls as young as 12 work in the factories.If workers arrive 15 minute late they must work 3 days without pay.Work is often dangerous and the workers don’t have protection.

Again it is very difficult for workers to protest. When workers tried to organize a trade union the leaders were assassinated. When human rights workers came to investigate workers were too afraid to speak about their problems.

There are many companies that allow their clothes to be made in factories where wages are very low and conditions are terrible. Many of the companies are very well known and respected in the North. Shoppers pay high prices to buy their clothes, because of the respect they have for the name of the company.Many shoppers do not know about the conditions of the workers who make the clothes.

Read ‘Nike and Gap’

In small groups:

26. Fair Trade

Explain:

22

Possible answers: Write letters to the head of the company, strikes, awareness campaigns, petition, consumer awareness, leaflets / posters, get consumers to complain, get help from other organisations, form trade unions etc.

Imagine you are an organisation working to improve the conditions of workers in sweatshops. How could you encourage a big business to change its policies regarding sweatshops?

As a class, brainstorm: What do you think free trade organisations try to do?Write the students’ answers on the board.

Read ‘Fair Trade’

Answer these questions:

Read ‘Fair trade coffee’ and ‘Fair trade honey’

27. What are sanctions?

Ask the class:

23

Many groups around the world are now promoting what is called fair trade.Fair trade organisations believe that most international trade is unfair because the big businesses in the developed countries make large profits, but the workers and producers in the poor countries get very little pay.Workers struggle to earn a living in bad conditions and get no training or opportunity to improve themselves.

1. Why do you think it is important to give employees opportunities to develop

themselves?2. What is the difference between minimum wage and living wage?3. What does being open to public accountability mean?4. Who are the consumers that fair trade organisations seek to educate?5. How do fair trade organisations respect cultural identity?6. How does fair trade help communities?

Answers:1. Students’ ideas2. The minimum wage is the lowest wage that can legally be paid in a country, the living wage is the lowest wage needed to cover basic needs. In some countries the minimum wage is lower that the living wage.3. The accounts of how the money is spent and profits that fair trade organisations make must be available for the public and the Fair Trade Federation to see.4. The consumers are the people in wealthy countries that buy the products.5. Fair trade organisations respect cultural identity by encouraging the development of products based on producers’ cultural traditions. They seek to promote producers’ cultural identity.6. Fair trade also encourages workers to reinvest in the communities, e.g. building clinics.

Suppose that a country has been trading with the rest of the world for many years then, suddenly the rest of the world refuses to trade with the country. How would this affect the country?

Suppose another country is very poor and relies on financial aid from the rest of the world to be able to develop. How would this country be affected if the financial aid was stopped?

How might these two actions affect the governments of the countries?

Write the students’ ideas on the board.

Explain:

Read ‘Sanctions’

28. Sanctions and Iraq

As a class brainstorm:What do you know about Iraq?

Write the students’ ideas on the board.

24

Sanctions are designed to encourage ‘bad’ governments to change their behaviour.Reasons for imposing sanctions are usually human rights abuses, or illegal production of weapons of mass destruction.

Sanctions include:Stopping trade Stopping aid Recalling loansEnding diplomatic relations

Sanctions work on the theory that by stopping trade and financial support to a country, the country will become poorer.If the country becomes poorer, the government will become weaker.Eventually the government will become so weak it will change its behaviour, or even lose power.

There is a lot of debate over whether or not sanctions work.

Many people argue that sanctions do not work. That the people of a country are hurt first by sanctions, but governments are unaffected.Often the sanctions do not force governments to change.

One problem is that often not all countries impose sanctions – this weakens their effect.In the case of Burma, the US, UK and Europe have imposed sanctions on Burma, but many Asian countries, particularly China, India and Thailand continue to trade with Burma.

Explain:

Read ‘Sanctions and Iraq’.Answer these questions:

29. Sanctions and South Africa

As a class brainstorm:What do you know about South Africa?

Write the students’ ideas on the board.

25

The next reading is about sanctions imposed on Iraq. It was written before the US occupation of Iraq, when Saddam Hussein was still in power.Iraq is an example of the failure of sanctions to bring change.

1. What was the standard of living in Iraq like up to 1989?2. How many children died from sanctions related causes?3. How was health care affected by the sanctions?4. How were the lives of children affected by sanctions?5. What effect did sanctions have on Saddam Hussein?

Answers:1. Up to 1989 most Iraqis had access to clean water, high-quality

health care, good education and nutrition.2. 1,211,2853. Health care was badly affected: there were no painkillers,

antibiotics or anaesthetic; hospital equipment could not be repaired; medical knowledge was denied.

4. Illness, malnutrition, poverty, death, low education, no books, no toys etc.

5. No effect

Explain:

Read: Sanctions on South Africa.Underline the effects that sanctions had in South Africa.Complete the vocabulary exercise below the reading.

Discuss:What are the differences between the effects of sanctions on Iraq and sanctions on South Africa?

30. Sanctions and Burma

Explain:

26

South Africa is an example where sanctions did help to bring change to an oppressive government.

Sanctions have been imposed on Burma.

US sanctions: Import banBan on financial services (loans etc)Visa restrictions Ban on arms salesNo new investmentLimited humanitarian aid

EU sanctions: Ban on arms salesLimited assistance to governmentVisa restrictions / frozen assets to list of people

(UK added on 27th Oct 2004: No more loans / credit to State owned companies)

Canada: Visa restrictions

Japan: Stopped developmental assistance for a while (now started again)

Australia: Stopped human rights training programStopped agricultural aid

Read ‘Sanctions and Burma’Answer the questions below the reading.

Explain:

Discuss:Do you think constructive engagement could help to change the Burmese government? Why / why not?Do you think sanctions can help to change the Burmese government? Why / why not?Should there be sanctions on Burma?Should sanctions on Burma be lifted (stopped)?

27

Two views for dealing with bad governments:SanctionsConstructive engagement

In many ways, constructive engagement is the opposite of sanctions. When sanctions are imposed on a country, the country becomes more isolated – socially, politically and economically.

Constructive engagement is the idea that continued contact, support, trade and diplomatic relations with a bad government will over time encourage the government to change its policies.

China and Thailand both use constructive engagement with the Burmese government. The Thai government claims that by maintaining contact and communication they can influence the government of Burma.Allowing Burma to become a member of ASEAN is another example of constructive engagement.

Supporters of sanctions would argue that constructive engagement doesn’t work.They argue that countries engaging in constructive engagement are really doing so for their own economic interests.

In small groups: Use the readings and own ideas to brainstorm – For and against sanctions on Burma.Encourage the students to think of as many reasons as possible – political, social, economic, health, environmental etc.

Debate – Should there be sanctions on Burma?Divide the class into two groups according to opinion – For and against sanctions on Burma. (Try to get two groups of equal size – some students might have to join the group opposite to their real opinion).

Give the groups 20 minutes to plan arguments to support their opinion.

Let the two groups debate the issue.

31. Tourism

Give each student a piece of paper. Ask them to write on the paper, the one place they would like to visit if they could go anywhere in the world, and three reasons why they would go there.

Get some of the students to read their answers.

28

As a class brainstorm:

Read ‘Tourism’

In small groups answer these questions:

Discuss the groups’ opinions.

29

What are the benefits of tourism?What problems are caused by tourism?

Should tourists from other countries go to Burma for a holiday?Should people from other countries go to Burma to learn about the country?Do visitors to Burma do more harm or more good?Should all tourists stay away from Burma until the government changes?

With each question give reasons why / why not.