Globalization and Health Effects in SAARC Region, Evolving a Framework of Analysis

By Arora, Guljit K.; Gumber, Anil | International Journal of Economic Development, October 2004 | Go to article overview

Globalization and Health Effects in SAARC Region, Evolving a Framework of Analysis


Arora, Guljit K., Gumber, Anil, International Journal of Economic Development


Abstract

Globalisation has evolved out of a gradual progress of progressive integration of the world economies through falling trade barriers, greater exchange and mobility of capital and labour. The process further facilitated by a number of developments in international cooperation, emergence of international institutions and the continued advances in information and communication technologies also paved the way for global governance. The new globalisation environment has driven several developing countries with a sizeable public sector to adopt policy reforms including macroeconomic and financial stabilization policies, creation of market-oriented environment and more space for the private sector. This goes hand in hand with increasing internationalization of goods, services, labour and capital, and exchange and exposure of human beings for development oriented programmes. However, such a process is likely to have far reaching effect on health--both direct and indirect particularly in developing countries, where health attainments are low and majority of population lacks resources to finance their healthcare needs. The dynamics, mechanism and pathways through which the process of globalisation affects the health sector is not yet clear as their linkages are complex and influenced by several key set of endogenous and exogenous factors.

This paper while focusing on the SAARC region (South Asian Association for Regional Cooperation), discusses different channels and their dynamics through which the process of globalisation affects the health sector. An attempt is made to evolve an analytical framework for assessing the health effects in a comparative basis and explore both direct and indirect effects of globalisation on health. The SAARC region is selected as globalisation induced policies particularly in these countries are being questioned on grounds of - rising healthcare cost, WTO compliance costing too high to the domestic industry and economy, and increasing infectious diseases associated with international travel and migration. These issues are further discussed in the light of accessibility, efficiency, and quality of healthcare delivery, geographical inequalities, heavy burden of private healthcare financing, and fiscal stress faced by governments in these countries. This analysis assumes importance if health objectives set forth in the Millennium Development Goals (MDG) have to be realized in the SAARC region.

I. The Context

Globalization seen in the historical perspective has evolved out of a gradual process of progressive integration of the world economy through falling barriers to trade, enhanced exchange, and greater mobility of capital and labour. These trends while providing market-orientation were further facilitated by the emergence of economic co-operation among various countries and international institutions, the economic collapse of the former Soviet Union, the macroeconomic imbalances in several countries particularly in the 1980s, and the emergence of the European Union (EU). The rapid advances in information and communication technologies (ICTs) and their digital convergence has also complemented the globalisation process by cutting down drastically the delay and distance along with providing a far greater access to information, which is not only rapid and cheap, but 'symmetrical' too, that is more and more people can access vast information, whenever and wherever they need it.

Globalization is neither a simple economic phenomenon nor a traditional concept of internationalization. It is a process of integration, which enables an intermeshing of social groups in almost all spheres, be it economic, social, religious, political, legal and cultural. Economic integration involving an increasing interaction of inputs, factors and final product markets across countries enhances the role of multinational corporations (MNCs) in international economy (1).

In fact globalization requires conscious human decisions to bring in a general direction of change towards market-oriented environment (Petras and Veltmeyer, 2001). …

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