Economic Issues

Question 1

51. What is the MPI and what measures does it use?

Answer 1

The Global Multidimensional Poverty Index (MPI) was developed in 2010 by the Oxford Poverty & Human Development Initiative and the United Nations Development Programme and uses different factors to determine poverty beyond income-based lists. It replaced the previous Human Poverty Index.

Health:
Child Mortality
Nutrition

Education:
Years of schooling
School attendance

Living Standards:
Cooking fuel
Toilet
Water
Electricity
Floor
Assets

Question 2

52. Which country has the greatest number of people living in extreme poverty?

Answer 2

India

Question 3

53. Which types of trans/multinationals make up the top 10 from the Global 500, and who are they?

Answer 3

1. Walmart
2. Sinopec Group
3. Royal Dutch Shell
4. China National Petroleum
5. Exxon Mobil XOM , 2.26 %
6. BP
7. State Grid
8. Volkswagen
9. Toyota Motor
10. Glencore
    Mostly oil companies, some state owned. Also related to cars.

Question 4

54. Why are multinationals, (such as Walmart, Coca-Cola, etc.) so powerful/influential?

Answer 4

They employ people worldwide. People worldwide rely on either purchasing or selling their products. If they fail, they bring many industries with them.

Question 5

55. What contributes to increased globalization and how is it exemplified (e.g. FTAA, APEC)?

Answer 5

Multinational and Transnational corporations contribute to increased globalization. Trade organizations also contribute to increased globalization, as they increase trade and communication between nations.

Question 6

56. What is neo-colonialism, using Coca-Cola as an example:

Answer 6

is the geopolitical practice of using capitalism, business globalization, and cultural imperialism to influence a country, in lieu of either direct military control (imperialism) or indirect political control (hegemony).
Coca-Cola has become one of the symbols of America/freedom. It has tried to conquer many cultures, and succeeded especially well in Mexico by permeating Mayan religion and became part of their rituals.

Question 7

57. How is a TNC different from a MNC?

Answer 7

Multinational Corporation is an organization that owns or controls products in one or more countries other than their home country (but still keeps home country’s identity). Ex. Honda

Transnational Corporation does not identify with one national home.

Question 8

58. Using an example, explain how developing countries have benefited from MNCs moving in:

Answer 8

Increase of jobs

Question 9

59. Using an example, how have some MNCs abused their powers in certain developing countries?

Answer 9

In Guatemala, Coca-Cola got involved in the politics because one of the managers of the bottling plant there did, saying he hated pepsi, unionization, and communism.

Question 10

60. Why is offshoring becoming increasingly popular in India, citing specific examples:

Answer 10

Medical scans. Labour is more affordable, and due to time zone differences, the work can be done “overnight”.

Question 11

61. What roles do the following organizations play: WTO, IMF, World Bank (How have they helped & hindered?)

Answer 11

IMF: a lender of last resort to supply emergency loans to countries which ran into cash flow problems. Not free, has interest attached.

WB: increase low standard of living, increase industrialization, help countries ‘grow’ their way out of poverty through economic development

WTO: govern world trade, stop protectionist polices, governs trade of G&S

Question 12

62. What roles to NGOs play, in comparison?

Answer 12

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Question 13

63. Comment on the wealth inequality within: a) the world, U.S. and Canada:

Answer 13

In the world, people in Canada and the US are among the 1% of the richest people in the world. Within that 1%, there are major contrasts.

Question 14

64. Why do countries deal with ‘hard’ currencies rather than local currency?

Answer 14

Hard currencies are less likely to fluctuate, and are used as a base. The pound and the USD are more predictable and stable, so countries are less likely to lose a lot of money.

Question 15

65. In which cases might bilateral aid be more / less effective than multilateral aid?

Answer 15

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Question 16

66. Where do Canada’s priorities currently lay in terms of global debt relief vs. ODA?

Answer 16

Canada follows whoever is in power at the moment. the liberals are more about debt relief than development aid.

Question 17

67. As at 2006, which DAC member countries met or exceeded the UN target for official development assistance? Where does Canada rank on this list?

Answer 17

The US. Canada is ranked 8.

Question 18

68. Compare various ways of delivering foreign aid to a country:

Answer 18

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Question 19

69. Why does Jeffrey Sachs believe that current aid in Africa is working, but needs more funding?

Answer 19

Effective aid that is put into specific causes has made a difference. Malaria has reduced due to the investment in bed nets.

Question 20

70. In contrast, Dambisa Moyo proposes what as an alternative?

Answer 20

To stop funding so that developing countries in Africa will be forced to become self-sustaining. Moyo suggested selling their sell phone licenses as a business opportunity.

Question 21

71. What measure is the best way to determine a country’s overall economic health?

Answer 21

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Question 22

72. Explain how the global reliance on oil lead to world debt crisis between 1970-1980:

Answer 22

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Question 23

73. Why would a country want to avoid a sovereign default?

Answer 23

A sovereign default is the failure or refusal of the government of a sovereign state to pay back its debt in full. Creditors want to know that they can be paid back. can mean a devaluation of their monetary wealth.

In addition, the following scenarios can occur in a debtor state from a sovereign default:
a banking crisis, as banks have to make write downs on credits given to the state.
an economic crisis, as the interior demand will fall and investors withdraw their money
a currency crisis as foreign investors avoid this national economy

Question 24

74. What is the HIPC initiative designed to do?

Answer 24

Under the HIPC Initiative, the World Bank and IMF Boards first decide whether or not a country is eligible for debt relief (decision point document).

In a second step, all creditors (multilateral, bilateral, and commercial) commit debt relief to be delivered at a “floating” completion point.

Question 25

75. What were the goals of the Jubilee 2000 Campaign?

Answer 25

Jubilee 2000 was an international coalition movement in over 40 countries that called for cancellation of third world debt by the year 2000