Obstacles to Development REASONS WHY THINGS DO NOT GET
BETTER
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GOVERNMENT The decisions governments make particularly in terms
of public spending The economic / political ideology The level of
corruption The amount of bureaucracy and hindrance to private
enterprise The accountability of government to its people Security
and the rule of law
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Vicious cycle of political instability
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Access to Capital Without access to capital businesses cannot
grow. No property rights and no legal status for your business no
access to credit no capital to invest in the growth of your
business no possibility for growth and expansion low revenue low
profit
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Disease Diseases such as Malaria and HIV/Aids reduce the
productivity of a country. Death rates among economically active
population are increased, people are too sick to work or caring for
the sick. High levels of disease, infant mortality rates and
fertility rates can be related to poor provision of health
care
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Natural Hazards Back to the idea of environmental determinism.
Natural hazards can be an obstacle to development. Drought
(Ethiopia mid 1980s), 2004 Indian Ocean Tsunami impact on
Indonesia, regular flooding in Bangladesh, tropical storm damage in
Caribbean.
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Inaccessibility Map shows number of days travel to nearest
city.
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Landlocked and poor Countries with coasts and deep sea ports
are able to import and export products easily and therefore be more
integrated into the Global Economy.
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Top container ports
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Unfair Trade and Protectionism Subsidies paid to producers in
MEDCs and trade barriers and protectionism limiting access to MEDC
markets for LEDC producers are seen as major obstacles to
development. *Subsidies: A benefit given by the government to
groups or individuals usually in the form of a cash payment or tax
reduction
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Unfair Trade and Protectionism Levels of protectionism are high
in the global economy and many analysts argue that the rules of the
Global Economy were made by MEDCs for the benefit of MEDCs.
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Trade Benefits for all? In theory trade should benefit all
countries. International trade has been going on for a long time,
so why are not all countries rich?
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Dumping The rich world tells the poor world to get rid of
subsidies, but continues to spend $1 billion a day subsidizing its
own farming enterprises http://www.maketradefair.com/en/index.phpf
ile=issues_dumping.htm&cat=2&subcat=3&se lect=1
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Market Access If Africa, East Asia, South Asia, and Latin
America each increased their share of world exports by just one per
cent, the resulting gains could lift 128 million people out of
poverty http://www.maketradefair.com/en/index.phpf
ile=issues_dumping.htm&cat=2&subcat=3&se lect=1
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Forced liberalization Millions of poor farmers in developing
countries cannot earn a living because of cheap, often dumped, food
imports http://www.maketradefair.com/en/index.phpf
ile=issues_dumping.htm&cat=2&subcat=3&se lect=1
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IMPACT OF AID AND DEBT RELIEF
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Aid received, per capita, in 2007, in $ of Official Development
Assistance per person. Note that grey countries can either be
non-recipients or ones for which data is unavailable. The data were
converted into dollars using exchange rates, hence may not
accurately reflect the purchasing power of the foreign aid
receiveOfficial Development Assistance per person. Note that grey
countries can either be non-recipients or ones for which data is
unavailable. The data were converted into dollars using exchange
rates, hence may not accurately reflect the purchasing power of the
foreign aid receive
Aid is... Support Goods Services Money... given to those in
need
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Duration: long-term, short-term, emergency Delivery: financial,
goods, services from trained people Source: government,
non-governmental organisations (NGOs), charity, individuals
Dependency: tied aid What different types of Aid are there?
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What is top- down development? These tend to be big schemes and
decisions are made by the national government. Local people who
often live near the scheme do not get involved in the process
Examples:
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External Groups e.g. World Bank, TNCs National Government Local
People
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What is bottom-up development? Local people are fully involved
in the process and decision making Examples:
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Local People National Government External Groups e.g. World
Bank, TNCs Decision made here
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Top Down Approach Country gets into debt as it borrows money
from the World Bank etc Uses machinery etc rather than providing
jobs for local people Relies on external links and technology As
these areas grow the take away resources from peripheral areas
Conditions often attached to the loans Dams etc provide energy
needed for the country to develop Often environmentally effective
as they use cheaper fuels e.g. HEP
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Bottom up Approach Very limited impact of national poverty
levels Involve the local people Appropriate technology to the local
skill level Low cost
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Which are the best option? Looking at both Top down and bottom
up approaches to development, which do you feel are the best option
and why?
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Effective aid projects or not? Government funding to Nepal the
UK Government recently gave 65 million to the Government of Nepal
to use in its health services Oxfams Let Agogo Project in Haiti
gives cows to people who care for the cows and sell on the dairy
products to earn income International Aid to Afghanistan much of
the international aid to Afghanistan is paid to foreign contractors
for projects that do not meet the needs of the poor
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Different Types of Aid (cont) Type of AidDescription Voluntary
aidCharities raising money for long term developments Bilateral
aidMoney given from one country to another for projects Tied aidThe
donor benefits (military bases) Multilateral aidInternational
organizations (UN) * Emergency aid: following a disaster
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Remittances Global remittances are about $300 billion per year.
30 million Africans send appox. $40 billion annually from the
countries of work to their home countries. Up to 40 % of
remittances to Africa are destined for rural areas Problem: most
money transfer centers are in urban areas.
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Remittances
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Poor Countries Debt Reasons for problems low growth in
industrialized economies high interest rates between 1975 and 1985
increase in oil prices falling commodity* prices *any unprocessed
or partially processed good, as grain, fruits, and vegetables, or
precious metals.
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What has been done? Structural Adjustment Programmes (SAPs)
economic policies for developing countries that have been promoted
by the World Bank and International Monetary Fund (IMF) since the
early 1980s
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Structural Adjustment Programmes (SAPs) SAPs believe the key is
with international trade. They consist of 4 main goals greater use
of a countrys resource base Policy reforms to increase economic
efficiency Generation of foreign income through diversification of
the economy and increased trade. Reducing the active role of the
state
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Not everyone agrees http://www.globalissues.org/article/3/s
tructural-adjustment-a-major-cause-of- poverty
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Stabilization Measures Short term Limit any further
deterioration of the economy (wage freezes, reduce subsides on
food) Longer term boost economic competiveness (tax reduction,
export promotion, downsizing civil services, privatization and
economic liberalization)
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Heavily Indebted Poor Counties Initiative (HIPC) The original
focus of the HIPC Initiative was on removing the debt overhang and
providing a permanent exit from rescheduling. Also to promote
reform and sound policies for growth and human development.
Launched in 1996 by the IMF and the World Bank.
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Heavily Indebted Poor Counties Initiative (HIPC) 41 of the
poorest and most heavily indebted countries, of which 33 are
located in sub-Saharan Africa, are currently eligible to benefit
from debt reduction under the enhanced HIPC Initiative.
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Heavily Indebted Poor Counties Initiative (HIPC) There are two
main stages to the HIPC Initiative. During the first stage the
countries must adopt a number of measures in order to be considered
for interim debt service relief (decision point). Once accepted,
they qualify for some interim debt relief and must implement
certain policies and meet certain conditions in order to qualify
for full assistance (completion point). The process is very
flexible, as there is no fixed timetable for the completion of the
two stages.
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Sustainable development Sustainable development is development
that meets the needs of the present without compromising the
ability of future generations to meet their own needs.
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without compromising the ability of future generations to meet
their own needs. This is the concept of intergenerational equity.
It is important to remember that future generations needs will be
greater than ours because of population growth and development. It
means that we inherit the Earth from previous generations and have
an obligation to pass it on in a reasonable state to future
generations. Our generation should not use more than our fair share
of resources
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Environmental Quality can be measured using a range of
indicators which basically quantify our impact on the environment.
Habitat loss, species extinction, biodiversity, air pollution, land
degradation, water pollution, resource use, waste disposal, energy
use and efficiencies, transportation, housing, recycling.