How Does Globalization Affect Latin America

INTRODUCTION

Latin America has been the go-to destination for non-renewable natural resources in recent years and is continuing to attract Canadian-based mining companies more than ever. Latin America currently attracts “25% of global expenditure on mining exploration, with six countries leading the way in the region – Mexico, Chile, Peru, Brazil, Colombia and Argentina.”(Earls, 2013) The World Bank and International Monetary Fund have continued to encourage Latin America to sustain an extractive industry as a strategy for growth in development. This paper will examine the effects of globalization and the impact Canada has had on Latin America. It will also include issues regarding the World Bank and IMF, as well as my thoughts and analysis.
The original purpose was to finance Europe after World War II, but it later shifted its attention to the general financial needs of developing countries. The World Bank provides financing to support countless economic development projects in South America, Africa, and Southeast Asia. It often carries out projects in agriculture, education, power facilities and transportation.
The International Monetary Fund is an agency that was created to assist in the regulation of fixed exchange rates and implement the rules of the international monetary system. Some of the main purpose according to the IMF website includes:
• Promoting international monetary cooperation
• Facilitating expansion and balanced growth of international trade
• Making the resources of the fund temporarily available to
Listed below are some of the ways they have used to accumulate their prosperity:
1. The Governments: It is run by the elites which seem to only benefit them, their family, and friends.
2. The use of International Financial Institutions: These institutions promote privatization, reduced taxes and loyalties on business being done in developing nations.
3. The use of Trade Agreements: It decreases the ability of governments to implement labour regulations (such as Guatemala). The use of International Centre for Settlement of Investment Disputes (ICSID), which is part of the World Bank, allows foreign companies such as Goldcorp, to sue countries which their business is set in (mostly developing nations). National courts and traditional international laws are bypassed.
4. Transnational Corporations: Goldcorp of Canada refuse to regulate their company which has led to a bad reputation regarding labour and environmental regulations.

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