Unit 13 Flashcards
To what extent may political factors cause large increases and decreases in trade?
Original Answer: Political factors like trade agreements (e.g., NAFTA) can reduce barriers and boost trade by fostering cooperation between nations. Conversely, trade restrictions such as sanctions or tariffs can significantly decrease trade flows. Political stability also influences trade, as unstable regions deter investment and trade activities.
Simple Terms: Trade agreements like NAFTA make trade easier and increase it. Sanctions or tariffs make trade harder, reducing it. Stable governments encourage trade, while unstable ones scare away trade and investment.
Can global inequalities in trade flows be explained in terms of historical factors?
Original Answer: Yes, historical factors such as colonialism created economic systems that favored developed countries by exploiting resources and labor in colonies. Even after independence, many developing nations remain dependent on exporting raw materials while importing expensive manufactured goods, perpetuating inequalities.
Simple Terms: Rich countries took resources from colonies and sold them expensive goods. Even now, poor countries export cheap raw materials and import costly manufactured goods, keeping trade unequal.
How might poverty affect development?
Original Answer: Poverty hinders development by limiting access to essential resources like education, healthcare, and infrastructure. It traps individuals in low-paying jobs, reduces human capital, and restricts economic growth. Poor countries often face challenges in attracting investment and participating in global trade.
Simple Terms: Poverty stops people from getting good schools, hospitals, or jobs. Without these, countries can’t grow or attract investment, keeping them poor.
Describe the role of the World Trade Organization (WTO) and, using examples, evaluate its work.
Original Answer: The WTO facilitates international trade by reducing tariffs, settling disputes, and creating trade rules. For example, it mediates disputes between nations, like the EU and US over subsidies. Critics argue it disproportionately benefits developed nations by promoting policies like reduced agricultural subsidies, which harm farmers in developing countries.
Simple Terms: The WTO helps countries trade by lowering tariffs and solving arguments. For example, it settles fights like those between the EU and US. Critics say it helps rich countries but hurts poor farmers.
Explain why trade may advantage some people more than others.
Original Answer: Trade benefits individuals or groups with competitive advantages, such as access to education, advanced technology, or developed industries. For example, skilled workers in developed countries gain higher wages, while unskilled laborers or producers in developing nations often struggle due to lower prices and competition.
Simple Terms: Trade helps skilled workers and strong industries earn more. But poorer workers or countries often lose out because they can’t compete.
Explain the term Fairtrade and, using examples, explain what Fairtrade aims to achieve.
Original Answer: Fairtrade ensures better trading conditions, such as fair pay and sustainable practices, for producers in developing countries. For example, Fairtrade-certified coffee ensures farmers receive a minimum price, helping them avoid poverty and invest in community development projects like schools or healthcare.
Simple Terms: Fairtrade makes sure farmers in poor countries get fair pay and good working conditions. For example, Fairtrade coffee helps farmers earn enough money to care for their families and build schools.
Explain the meaning of the terms visible import and invisible export.
Original Answer: Visible import refers to tangible goods brought into a country, such as cars or electronics. Invisible export refers to services provided by a country to foreign buyers, such as tourism, financial services, or intellectual property like software licensing.
Simple Terms: Visible imports are goods like cars or clothes a country buys. Invisible exports are services like tourism or banking that a country sells.
Why do some argue that trade is better than aid for LICs and MICs?
Original Answer: Trade is argued to be better because it promotes economic independence, creates jobs, fosters local industries, and generates sustainable income. Aid, on the other hand, can lead to dependency, corruption, and may come with conditions that benefit donor countries rather than recipients.
Simple Terms: Trade helps countries stand on their own by creating jobs, supporting local businesses, and building long-term wealth. Aid can make countries dependent and may come with strings attached that don’t always help the people.
What are some causes of the international debt crisis?
Original Answer: Causes include high-interest loans that were difficult to repay, falling global commodity prices reducing export revenues, economic mismanagement, and structural adjustment programs that required austerity measures, often harming economies.
Simple Terms: Countries borrowed money at high interest rates, but falling prices for what they export made it hard to pay back. Poor money management and strict loan conditions also made things worse.
What methods are used in debt relief for highly indebted countries?
Original Answer: Debt relief methods include full or partial debt cancellation (e.g., HIPC initiative), rescheduling repayments to reduce the burden, and providing concessional loans with lower interest rates. These efforts aim to make debt more manageable for the poorest nations.
Simple Terms: Poor countries may have their debt forgiven, payments postponed, or given easier repayment terms to help them recover and focus on development.
What are the disadvantages of receiving aid?
Original Answer: Disadvantages of aid include creating dependency on donors, potential for corruption where aid is misused, tied aid that benefits donor countries, and aid projects that may not align with local needs or reach intended recipients.
Simple Terms: Aid can make countries dependent, may not go to the people who need it, and sometimes comes with conditions that only benefit the donor countries.
What are some benefits of receiving aid?
Original Answer: Benefits of aid include improving healthcare and education, supporting emergency relief during crises, building infrastructure, and enhancing access to basic needs like food and clean water, which can improve living standards and foster development.
Simple Terms: Aid can save lives during disasters, provide healthcare and education, and help build things like roads and schools, improving people’s quality of life.
What are the reasons for the growth in international tourism?
Original: The growth in international tourism is due to increased disposable income, better transport (e.g., affordable flights), improved marketing, rise of the middle class, political stability, and more awareness of destinations through media.
Simple: More money, better travel options, and more awareness about travel have made tourism grow.
What are the reasons for the increasing popularity of ecotourism?
Original: Ecotourism is popular because people want sustainable travel, to protect nature, and to experience unique adventures. The unattractiveness of mass tourism and interest in environmentally-friendly activities also contribute.
Simple: People prefer eco-friendly and unique travel experiences over crowded traditional tourism.
How can tourism improve the quality of life of the local population in tourist destinations?
Original: Tourism creates jobs, boosts local businesses, improves infrastructure (e.g., roads, schools), and brings cultural exchange.
Simple: Tourism helps people earn money, improves facilities, and connects them to other cultures.
