Criticisms of Globalization: Threats to National Sovereignty

It is not only about Profits

Of the many criticisms of globalization, the prominent critique relates to the fact that globalization erodes national sovereignty and takes away the power of governments. By allowing international corporations and multinational businesses to set the economic (and often, the political agenda), critics argue that the nation state becomes irrelevant.

The point to be noted is that if global corporations can set the agenda, there is nothing inherently wrong about that. Just that capitalism runs on the profit motive to the exclusion of everything else and hence, businesses simply cannot be allowed to set the terms of the political and economic discourse because the nation state is answerable to all citizens and not just to the wealthy and privileged.

It needs to be mentioned that nation states exist for welfare of the citizens and not for making profits alone. By usurping the powers of the nation state, the corporations reduce everything to money and profits and this has a corrosive effect on the welfare of the citizens.

One World Market

Ever since the 1990s, it has become fashionable for corporations to demand global rules of doing business that are uniform across the world.

In other words, international businesses want the same set of rules and procedures in all countries i.e. the right to repatriate profits, the right to exploit natural resources, uniform taxes, and tax structures, the removal of barriers on entry and exit, among other things.

This means that the notion of a global marketplace that is consistent across nations and one that is friendly to the corporations is the aim of this endeavor. This is definitely a plan to take away the power of the governments to set the rules and though there are many experts who point to the enabling features of globalization especially where lifting billions of people out of poverty is concerned, critics are aghast that the poor and underprivileged who are already suffering would be hit by a double whammy.

National Sovereignty vs. Supranational Corporations

Given the fact that some multinationals have more revenues than some countries entire economic output, the power of these companies is indeed deep and wide.

Hence, the temptation to override national governments and instead, set supranational rules to be followed results in the ceding of sovereignty by the governments. As has been discussed in the previous sections, this results in the notion of profits before people and does away with the basic humanitarian impulse that is behind the modern concept of democratic states.

The supranational economic order does not have allegiance to nations or nationalities but to super elite whose interests span across countries and whose loyalties lie to the economic principles that are devoid of humane and social objectives.

Concluding Thoughts

Finally, global corporations have grown in power in recent decades and this trend while contributing to global growth has also produced sharp inequalities and led to exacerbation of ethnic and social tensions between the haves and the have-nots.

Hence, there needs to be a moderation in the way global corporations are allowed to usurp the power of national governments and the way in which national sovereignty is ceded to the international businesses.


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