Global governance economic Flashcards
WTO Success Example - CPTPP 2018
Established a free-trade area between 11 countries in the Pacific region - worth $13.5 trillion
WTO Success Example - RCEP 2020
free-trade agreement in the world, bringing together the largest economies in Asia-Pacific
E.g add 0.4% annual GDP
WTO Success Example - Increase trade
Trade has grown 2100% between 1995 and 2014
WTO Success Example - Boeing 2021
A 17-year dispute between the EU and USA over aircraft subsidies was finally resolved when the WTO ruled that Boeing and Airbus had received illegal benefits
WTO Failure Example - Trump administration
E.g Ruled that the tariffs the Trump administration imposed on China were inconsistent with global trade rules and yet the USA refused to change its position.
WTO Strength Example - Reduce Tariffs
1947 - 40% price of exported/imported good was tariff
2000 - 3% is tariff
WTO Weakness Example - Doha Trade Round 2001
Series of negotiations with good aims, lowering trade barries, facilitating increased global trade and lowering agricultural subsidies
However failed and never went ahead
WTO Weakness Example - Consensus
Each of its 164 member states has the power to veto decisions, so they must be made unanimously
WTO Quad Weakness Example - Gambia
Fish freezing plant given by Japan
Gambia has no refridgerated trucks so it’s unused
WB Weakness Example - Ugandan Honey bee
World bank gave money 4 times to Uganda for honey bees, each time money disappeared through corruption
WB Weakness Example - Displacement
3.4 million
WB Weakness Example - North Macedonia
Road upgrade and development project destroys parts of forests and the environment which it cuts through
WB Weakness Example - Weighted Vote
US - 15% of vote
WB Strengh Example - Gambia
World bank gave them sand for beaches + buildings
WB Strength Example - Environment
Loaned India $65m to fund renewable energy
WB Strength Example - Lending money
2021-22 - Lent $114.9 billion to developing countries to support projects designed to lessen the impact of increased energy and food prices
WB Strength Example - Debt relief
By 2022, $76 billion in debt relief had been awarded to 37 of the worlds’ poorest countries
WB Strength Example - Bangladesh
Provided humanitarian aid by with a rural water supply and saniation projects.
Provided nearly 1.2 million with access to improved water sources and hygienic latrines
IMF Strength Example - Brazil
2002, loaned $30 billion to stop it from defualting.
Since then it has carried out free market reforms and has maintained strong economic growth
IMF Strength Example - Ukraine
March 2022, gave $1.4 billion to Ukraine to help it survive economic shock of the Russian invasion,
2023 Loaned a further $15.6 bn to Ukraine
IMF Strength Example - Assistance
Since 2020 - 96 Countries assisted
IMF Weakness Example - Greece
Unpopular - 61% of citizens rejected it in a 2016 referendum
Forced to accept it anyway
IMF Weakness Example - Shock Therapy
1990s Shock therapy in Russia led to economic collapse and rise of Anti-Western Sentiments
Chomsky - SAPs have disastrous consequences
IMF Weakness Example - Tanzania
2000 - Demanded it start charging for education and healthcare to increase government revenue
Result: School enrolment drop from 98% to 66% and AIDS rate increasing by 8%
IMF Weakness Example - Ecuador
2019 - Forced to undertake a 6% spending cut
Lead to demonstrations and unrest
IMF Weakness Example - Joseph Stiglitz
Undemocratic policy formulation process
IMF Weakness Example - Voting procedure weighting
Made by vote of board governors
Weighting for each coutnry is unequal
E.g USA 16% , Uganda 0.1%
IMF Weakness Example - Neo liberal Policy
Ha Joon Chang - Neoliberal policy is not always successful
Adam Smith Wealth of Nations
Division of labour among workers into specialised tasks is a driver of growth in the transition to an industrial, capitalist economy.
‘Invisible hand’ - individuals acting in self interest within a free-market can yield productivity and social gains through a system of mutual interdepend
Availabitility of specialised tools and equipment would allow workers to further specialise and thereby increase productivity.
-Ongoing Capital accumulation is necessary for this to happen, owners of capital need to keep and reinvest profits from their investments.
Structural Development Theory (SDT)
Economies should preserve an external trade balance in the long term, as it will result in evolution and growth over time.
Neo-Classical Development Theory (NCDT)
A steady economic growth rate results from 3 driving forces:
Labour
Capital
Technology
Classical Economic Development Theory (CEDT)
Capital accumulation
Reinvestment of profits derived for speciailisation
The division of labour
Pursuit of comparative advantages
Prebisch Singer Hypothesis (SDT)
The prices of primary goods (such as raw materials and agricultural products) tend to decline relative to the prices of manufactured goods over time.
Because demand for primary products is relatively inelastic, while the demand for manufactured goods is elastic
Infant Industry Argument (SDT)
New or developing industries in a country need temporary protection from foreign competition in order to grow and mature.
