paper 2 reducing the global development gap Flashcards
why do countries need to trade
to generate wealth and to meet the needs of the resources they don’t have
does economic development happen for all countries - why
No LICs only trade in primary products - raw materials and dont always receive a high price
what is the consequence of this
LICs dont have money to import manufactured products from HICs It is harder for them to develop without computers or hospital equipment
why do primary products achieve a low price (2)
overproduction - to many countries grow the same crops pushing prices down
import taxes - EU protects its own farmers by taxing imported food so it is hard to get a good price
How does investment by transnational companies TNCs helps NEEs and LICs
they move production to NEEs and LICs and inject cash
what is the cash called that TNCs invest
foreign and direct investment
why do TNSs invest in other countries (3)
1 reduce transport and import costs
2 looking for a new market
cost of labour is cheaper
what is international aid
gift of money goods and services to a developing country through charities like oxfam
where is international aid targeted - give an example
where there are longer term development goals
in 2014 Dr Congo was given $73 million to build a new dam and hydro electric power which would create jobs. It was later discovered the money was taken by the Prime minister
name other ways NEEs and LICs have benefited from gifts of money
equipment for education - google distributed thousands of laptops to children and teachers in S America and Africa
England’s budget targets health of pregnant women
where is UK directed to
commonwealth countries
where does India’s and China’s aid go to
Africa
what is intermediate technology
technology local community can take ownership of and maintain eg hand water pumps to provide clean water
what has been the impact of the water pumps in Tanzania (2)
life expectancy has increased - fewer deaths from disease
education has improved as children are missing fewer days
what is the aim of fairtrade foundation (2)
1 to give producers a better price for goods produced. 2 Guarantee prices even if global prices fall
what do HIC consumers buy that is fair trade
chocolate, bananas wine
why do some avoid buying fair trade
it is expensive
why do some pay more for fair trade
they know more of their bill will go directly to the poorest
what caused the debt crisis
between 1960-1980 HICs loaned large amounts of money. In 1982 Mexico admitted they had no way of repaying the loan
who did mexico owe money to
world bank and international monetary fund set up after WW11 to help reestablish the economy
is it a bad thing for countries to borrow large sums of money
not if it is invested to generate money to repay and help the country to develop
give an example of where borrowing money has been a success
world bank lent Lagos $1 billion to build a dam and generate hydro electric power which they now sell as electricity
how else can debt relief be achieved
through conservation relief swap - HICs right of LIC debt if they protect their physical environment
what is a microfinance loan
LIC and NEE borrow small sums
