Poverty, Development And Trade In Globalised World Flashcards
8 controversial propositions
- Global poverty has changed in past 30 years
- We can generally agree on how to define development
- Development aid is becoming less important
- China is a better development partner for low-income countries that the West is
- the SDGs (sustainable development goals) are a talk shop with little real impact
- Global value chains built out global system
- Globalisation has already peaked
- The LIO is worth defending
1 Poverty
- malleable, relational and social
- absolute poverty had been decreasing in many low and middle income countries
- some countries experience a growing but fragile middle class
- human development has improved in many ways
- 1-year-old vaccination
- girls finishing primary school in low income countries
- average life expectancy of 70 years
- access to electricity
- some kinds of inequality increased
- food price, water access etc
- Africa in danger of becoming the (re-)forgotten continent
2 Development
- changeable nature
1850 - increased ability to extract natural resources from colonies
1900 - betterment of native populations
1970 - breaking free from exploitative relationships with first world countries
2020 - state and market working together to insert stagnant economies into global value chains
3 development aid
Official development assistance (ODA) overtaken by
- foreign direct investment
- grants by non-ODA members (eg tied aid)
- non-concessional loans
- military aid
- non-economic assistance (eg study visits, technology transfer)
=> financing more fluid, tailored, selective, issue-driven and based on mutual interests
4 China better development partner
Differences
- fewer conditionalities related to governance
- investment in different sectors (industry, infrastructure)
- greater use of non-ODA modalities
- private and public sector investment more blurred
- more tied aid
- fewer requirements for ESG (environmental, social and governance) compliance
But
- both a mix of ideology and interest (false dichotomy)
- lots of convergence (zbližovanie) in recent decade (China increasing ODA-like aid, West collapses aid agencies into bodies that mix geopolitical, security and domestic economy)
Recent years show that support for China in decline
- Beijing’s foreign assistance is positively associated with economic outcomes but correlates with deforestation and negative perceptions of China among citizens although in negligible size
5 SDG
- 169 targets, some of them qualitative some quantitative
- “high school wish list for how to save the world” (Hickel 2015)
- requires 5-7 trillion USD
But
- have a certain performative and harmonising function, both in creation and implementation
- partial success (still better than nothing)
- it’s up to all of us to hold leaders accountable for their promises
6 global value chains
- country’s position in value chains is crucial
- moving up value chain = development
- leads to social dislocation
1955 to 2015 Japan
primary sector - clothing - hardware and PCs - consumer digital goods - robots
China and NICs 2015
Up to consumer digital goods
Mid-manufacturers 2015
Up to hardware and PCs
Mekong frontier 2015
Up to clothing
7 globalisation
To be replaced by
- automation
- increasing strain on existing resources
- regionalism
- multipolar geopolitical order with less cooperation
- unevenness - ideas and info will continue to flow but material objects less so
8 LIO
- Bush era turned democracy and HR into a dirty word
- in the new age of hybridity, the democracy of globalisation has not been matched with globalisation of democracy
- challenge now is to reconfigure the rules-based LIO by decoupling it from western post-war hegemony
- all the problems (mentioned before) are connected to each other and we are connected to them (they are all our problems)
HDI
- consists of literacy, education, life expectancy
- correlates with GDP per capita but there are differences
- eg - Qatar - high GDP, small HDI
- Sweden - high GDP, high HDI
Why different levels of development?
Internal factors
- governance
- corruption, poor leadership
- natural resources
- country with more oil is supposed to be more wealthy
- resource curse
- too much focus on natural resources that overlook other factors
- natural resource =/= good governance
- renter states - don’t have taxes because they get money from gas and oil (Saudi Arabia, Iraq, Libya) -> if peephole don’t pay taxes they are not allowed to demand the government to give them HR or other benefits
External factors
- donor countries - invest in countries with biggest spillover potential
- colonialism
Colonialism in regard to development
Dependency school of thought
- hindered the development (no natural middle class in these countries)
- colonial power = core, colonies = periphery
Sustainable development goals, Millennium Development goals
SDG issues
- lot of them
- no priority
- some clash with each other
MDG
- unsuccessful - good goals but very general and difficult to achieve (not action driven)
- too focused on LEDCs
Who’s responsible for global development
- developed countries - provide resources, technology and expertise
- developing countries - implement good governance, create an attractive environment for investment, focus on societal and environmental stability
- international organisations - facilitate cooperation and set global goals (eg UN, World bank)
Official vs private financial flows
Official
- state or IMF or World Bank, international organisations
Private (foreign direct investment)
- international bank loans, banking in one country can extend it to residents of another, non-governmental entities
