Aid, Trade and Debt

Question 1

why do donors provide aid?

Answer 1

altruism
geo-political interests
economic interests
reparations

Question 2

questioning/critiqing aid

Answer 2

international aid and trade is uneven
OECD is baso a rich country club that selects the countries that need aid (only uses income as a measurement of how well a country is doing)

Question 3

SOURCE: critique of neo-colonialism: reality is, state’s economic systems and thus its political party is directed from the outside

Answer 3

nkrumah, 1965

Question 4

what is the development state hypothesis?

Answer 4

the developed countries did not where they are now through the policies and institutions they recommend, most actively use bad trade/industrial policies

Question 5

SOURCE: development state hypothesis

Answer 5

ha-joon, 2002

Question 6

what is an infant industry

Answer 6

where they did not liberalise the economy so they were not ready to compete

Question 7

OECD definition of aid

Answer 7

resources transferred on concessional terms with the promotion of the economic development and welfare of the developing countries as the main objective

Question 8

concessional terms

Answer 8

below market rates
grace periods (can be several years)
low interest rates

Question 9

forms of aid given

Answer 9

grants, soft loans, emergency relief, project loans, food relief, military equipment, commodities, technological cooperation, economic interests

Question 10

left wing critiques of aid

Answer 10

reproduces unequal power relations between GN/GS and is often motivated by political and economic interests

Question 11

right wing critiques of aid

Answer 11

ineffective use of taxpayers money

Question 12

reformist critiques of aid

Answer 12

believe that aid is an essential tool for economic development and an avenue to saving lives (mosquito nets)

Question 13

types of aid

Answer 13

bilateral, multilateral, non-governmental, private (voluntourism, celebrity)

Question 14

what is the global trade-debt nexus

Answer 14

trade is unbalanced and therefore people accumulate debt

Question 15

what is foreign debt

Answer 15

it is in the currency of the loaners (usually USD) which is the strongest and most expensive
it can also be owed to private commercial banks, other countries, and IFIs

Question 16

IFIs recommend more trade because

Answer 16

a trade surplus allows countries to save and invest in their growing economies

Question 17

twin deficit theory

Answer 17

when countries consume more than they are producing and they cannot raise taxes high which leads to less money for investment

Question 18

what is a vulture fund

Answer 18

when counties purchase distressed sovereign debt at low prices and resort to various tactics to increase their value

Question 19

what are structural adjustment loans (SALs)

Answer 19

IFIs offer them for developing economies (controversial) bc it means a cut back on social spending and an increase of privatisation and deregulation

Question 20

SOURCE: critique of SALs

Answer 20

SALs means that millions of poor people are being asked to pay American prices (Silvia Federici)

Question 21

non-traditional donors

Answer 21

south-south cooperation
faith based
diaspora (ppl sending money back home)

Question 22

China’s Belt and Road Initiative

Answer 22

connective infrastructure that is based on the silk road that connects china to europe
$9.2 B of accumulated trade
aimed at rebalancing economic growth between eastern and western china
means that more countries receive chinease aid
dunford, 2020

Question 23

SOURCE: looks at south-south cooperation and the reaction from traditional donors

Answer 23

Mawdsley, 2017