Globalization, an important characteristic within the contemporary economic environment, has resulted in significant changes to individual nations in terms of economic development strategies undertaken by national governments. The term globalization refers to the integration of local and international economies into a globally unified political economic and cultural order, and is not a singular phenomenon, but a term to describe the forces that transform an economy into one characterized by the embracement of the free movement of trade, investment, labor and capital.

The drive for globalization has resulted in greater economic growth globally, through the opening up of barriers to international trade, yet this increase in world output is often associated with detrimental effects in relation to the stability of a national economy, being susceptible to the ups and downs of the international business cycle and also both positive and negative effects on the standards of living or quality of life with in a nation. It is often difficult to categorize economy as being globalized, yet there are several key indicators that suggest economic management decisions undertaken by the government have come as a result of globalization.

The main evidence to suggest the globalization of nations has been the growth in global markets, changes in global consumption patterns, the establishment of intergovernmental agreements as well as the rise of transnational corporations. Globalization has been essentially driven by the breaking down of economic barriers between nations over recent decades that have resulted in greater worldwide economic growth.

This economic liberalization has been spurred on by the global trend towards the deregulation of national economies as well as reforms to encourage greater competitiveness with in the global markets. As a result of the microeconomic reforms, globally there has been a general reduction of restrictions on trade, capital flows and foreign investments. In addition to this, technological advancements over the last half century have contributed to this “economic liberalization” where as a result of this technology growth, transport costs have reduced dramatically, making trade more cost efficient. Communication costs have also reduced through advancements in telecommunications and e-commerce resulting in escalated movements in international finance. Through these increases in trade and financial flows, countries have experienced increased level of economic growth over time that has contributed to the world standards of living. The global population now has greater access to the wider varieties of consumer goods and services, aided by the development of international markets and the ease of transactions permitted by technological advancements.

However, the standard of living, or quality of life is not simply a measure of the level of economic growth or change in real GDP, but it is a measure that takes into account the literary levels, education, health care, technological change and mortality rates. An example of a quality of life indicator is the Human Development Index (HDI) which measures changes in those factors as a result of globalization. Over the last few decades, the HDI of the world’s richest countries have increased as a result of globalization, where growth and development have been attributed to these economies through willingness to embrace market liberalization.

However, the HDI of the poorer nations have grown at a slower rate to the richer nations, which as some economists put it, show that globalization is another word for the continual plundering of the poorer and weaker nations by the rich and powerful economies. It has been strongly argued that the benefits of competition go only to those who can compete, and poor countries have to negotiate on unequal terms. In addition, the forces of globalization take no account for social injustices, with Asian sweat shops being a prime example.

Trade growth has contributed significantly to changes in living standards and economic growth of global economies, but its impacts have differed between different economies. While the increases in global imports and exports have come as a result of falling protectionist policies, it has advantaged mainly producers of manufactured goods, while producers of primary goods still face international barriers to trade. The consequence of this is the increase in trade between nations that produce different types of manufactured goods, and as a result much of the benefits of this increase trade go towards high income and NIC nations.

Developing nations such as, Afghanistan while experiencing growth, have not reached the same levels as high income nations, therefore widening the income divide globally. While globalization has resulted in aggregate increases in trade, output and investment growth over the past few decades, it is clear that the benefits from this growth have been distributed unequally between different economies. While developing nations are now focusing on manufacturing productions, high income economies are establishing new production patterns and many poor nations are not adapting significantly.

Consequently, this has resulted in lagging economic growth rates within less developed countries, while nations such as the fast growing “Tiger” economies have experienced phenomenal growth rates of close to high ratio. The income divide globally, as a result would tend to widen, as richer nations become richer at a faster rate than poor nations. However, a limiting factor towards continuing accelerated growth within high income nations continues to be the maintenance of an economy’s external stability, in particular preventing the blow outs of net foreign debt and equity over the business cycle, which might affect the international confidence in the management of the particular economy.

Therefore globalization on the whole has come as a benefit throughout the world, yet these benefits are still heavily weighted towards the already rich nations, while the developing economies struggle to maintain growth on par with the higher income nations, resulting in the evident contrast in quality of life between these “classes” of nations in the global economy. Our country Afghanistan has been really far away from such progression and globalization our industries, natural resources, and economical infrastructures ought to be rebuilt and rehabilitated for achieving the set goals of globalization. Our government policies regarding the fact of globalization has really been weak and out of date in the current era.