Superpowers EQ2 - Global Economic System

What does the world bank do

provides development loans to struggling countries

what percentage of voting does the US have in the world bank

16-17%

what are voting rights based on

financial contributions

what is the catch about the policies for loans to developing countries (IMF)

the policies prioritise larger shareholders (privatisation, liberalisation)

why were the IMF, WB, and WTO made and how does it show soft power/westernisation

to combat communism (Bretton Woods) -> western ideas

what does the IMF do

provides emergency loans to countries in financial crisis

what are the strict policy conditions called made by the IMF

structural adjustment programs

what do the structural adjustment programs encompass

austerity measures, deregulation and currency devaluation

what influences voting rights in the IMF

financial contribution

what share of voting does the US have in the IMF

16.5%

how can the IMF be used as a method to punish adversaries or help allies

superpowers e.g. US can use voting power to greatly influence conditions on programs given

what do the WTO do

set the rules for global trade in categories such as subsidies, tariffs, or dispute resolution

how does the WTO indirectly benefit superpowers

powerful and more developed economies have more expertise in complex sectors (e.g. digital trade) so they have greater negotiating power to influence rules to benefit themselves

how does the US use the WTO to open markets

they are able to use their expertise to influence rules on developing nations while protecting their markets using exemptions or subsidies

what happened to the WTO in 2019 which showed the US's weakness

blocked using veto power, the appellate body which is supposed to be the last step in dispute settlements, meaning the system is paralyzed

CASE STUDY: shows superpowers dominate global economic systems and use IGOs to their advantage

IMF and Asian Financial crisis 1997

how much have middle class increased by

3 billion increase from 2012 to 2030 in people who earn 10-100$ a day

what human effects does rising middle class have on resources in emerging powers

increased prices due to pressure on supply

availability falls as more purchases are made

what are the physical impacts due to middle class rising

more mining, oil drilling, and deforestation

more carbon emissions due to factories/industrialisation

consumer waste increases - lack of developed infrastructure to manage waste

more water used

What does the UN Security Council do

Maintains peace, authorised military action, imposes sanctions

Why is the UN Security Council criticised

Veto power=deadlock=unilateral action

Unrepresentative of global needs (Africa, India, Brazil)

Ineffectiveness - only taking action when members effected

CASE STUDY : UNSC response being unhelpful

Rwandan genocide - 800000 killed:

-Peacekeepers were distributed but had a weak mandate couldn't intervene

-reduced peacekeepers in height of chaos

DRC conflict

-deadliest since WW2

-accused peacekeepers of abuse and inaction

Why would economic alliances want to be in economic alliances

Access markets

Boost trade

Stronger vote in negotiations

Influence trade rules

Alliances offer financial support

Why are military alliances useful

Deters agression

Don't need to rely on your own military

Share intelligence and tech

Improves defence capability

Collective security

How is china protecting the environment

-ministry of env protection=m of ecology and environment

-CO2 neutral 2060, peak at 2030

-can generate 1.2 billion KW by 2030 with renewables

Implications of resource growth

-growing middle class

-80-90% shortage in China of rare earths

-19 million barrels of oil per day in USA, 12 million in China

How is the US combatting counterfeiting

Operation mega flex

-inspecting packages from international mail facilities