How to Keep the Third World Countries at bay

1. How to Keep the Third World Countries at bay Presentation by Emily Yao

2. Recipients of Aid • Single commodity countries • prices fluctuates because of the world market economy • Lack of trained people • building an educational system takes time • insufficient amount of people to learn the technology

3. Recipients of Aid • Quest for capital • seek it overseas because of lack of supply • Need for foodstuffs • implemented policies to encourage cash crops • food for consumption diminished • need food imports to feed citizens

4. Bilateral Aid • Direct aid from one country to another, usually from First World countries to Third World countries

5. Multilateral Aid • Aid that is funneled by a non-affiliated agency, such as the World Bank or UN agencies • considered to be more objective • less politically affiliated and more freedom is granted to the developing country • less intrusion

6. World Bank • History • Created to help in reconstruction after WWII • Grant loans for non-profitable construction like roads, schools, and housing projects. • Loan money to less industrious countries for promotion of their economic growth.

7. International Monetary Fund • Mission is to supply member states with money to help them to overcome short-term balance of payment difficulties • Money is only made available after the recipients have agreed to policy reforms in their economies-to structural adjustment • Membership of the World Bank is conditional upon membership of the IMF

8. Structural Adjustment Programs • Grant other more industrialized countries, like the US, access to resources like cheaper labor and foreign investment with lower export tariffs.

9. Structural Adjustment Programs • Third World Countries • national removal of subsidies to the poor on basic food stuffs • tax systems are made more repressive • real wage rates are allowed to fall sharply

10. Structural Adjustment Loans • Not tied to one specific project • Governments had to agree on a drastic program of liberalization for multi-million dollar loans • reduced state’s role in the economy • lowering barriers to imports, removing restrictions on foreign investment • emphasizing production for export rather than for local consumption

11. Privatization and Deregulation • Foreign investment is taking over the developing countries • Less power and control on the part of the developing state • Can raise rates, which make the poor suffer • Local governments are given money to let foreign investment take over.

12. Consequences of Aid • Economic deprevation • Social expenditures are slashed, like health and education • Environmental devastation • Massive deforestation • Near extinction of nearby coastal fish

13. Solutions • Abolish these institutions • Create a special UN agency to control the World Bank and the IMF • Peoples and countries force change on the institutions, by confronting them with evidence of the injustices

14. Cycle of Oppression • Funding for Third World Countries • Never get out of debt • Resources will be depleted to pay the debt • Third World countries will get poorer • Industrialized countries will be more rich

15. Strategic implementation of repayment • Conclusion • Once offered funds, Third World Countries will never be out of debt • Kept in a cycle of repayment • This binds the less industrialized countries to ask for more funds • The process of granting aid should be slowed down or thrown out

16. Works Cited • Arnold, G.(1985). Aid and the Third World: The North/South Divide. London, Great Britain: Robert Royce Limited. • Danaher, K. (1994). 50 Years is Enough: The Case Against The World Bank and the International Monetary Fund. Boston, MA: South End Press.

17. Works Cited • Hancock, G. (1989). Lords of Poverty: The free-wheeling lifestyles, power, prestige and corruption of the multi-billion dollar aid business. London, Great Britain: MacMillan London Limited. • Herman, E. S. (1995). Triumph of the Market. Boston, MA: South End Press.