Trade & Economic Development:

examples of ways to measure the unequal world:

1. literacy rates

2. GDP per capita

3. average life expectancy

4. amount of doctors per 10,000 people

development aid definition:

Aid by wealthier countries to less developed countries, typically project or sector specific.

types of development aid

• multilateral

• bilateral

World Trade organisation:

• Based on GATT founded in 1947: basic aim is to reduce barriers to the free exchange of goods and services, and to reduce government subsidies and other barriers to global competition. Includes most goods and services but excludes (or partially excludes) some (culture, agriculture, defence)

• Currently has 164 members

• Headquartered in Geneva

• Arbitrates on trade disputes between members and can impose sanctions on offending countries

• Main question: does increasingly deregulated free trade benefit or harm the less developed countries?

Bretton Woods institution:

• Set up in 1944 to bring stability to post-War order. Driving forces:

• Belief that economic crises in the 1920 & 30s propelled rise of Fascism (and WW2)

• Imminent process of decolonisation

international monetary fund:

• Membership of 189 countries

•  Aim: help countries overcome short term balance of payments and exchange rate difficulties through loans.

• Voting according to shareholder model

• Conditionality: Governments must carry out economic reforms in order to qualify for loans.

• This has attracted the most controversy

world bank:

• Aim: promote economic development through various kinds of longer-term loans, both to governments and to the private sector.

• Also provides investment guarantees

• Voting power of member states depends on their contribution, thus wealthier states have more say

arguments for GEI’s

• They help integrate countries into the global capitalist system and thereby promote development (examples: Singapore, South Korea, Taiwan, Chile, Ireland)

• They foster good domestic governance and accountability

• Institutionalized trade rules benefit above all weaker states - “right instead of might”

• Social and environmental issues were often neglected in the past, but more recently they have moved up on the agenda of GEIs

arguments against GEI’s

• They try to maintain the global capitalist system which in turn enshrines inequality, benefiting richer states and Multinational Companies

• Their economic prescriptions often harm the poorest members of society

• The economic model they promote is often inappropriate for the societies to which it is Applies

• They impinge on national sovereignty

• They are undemocratic (rich countries have the most influence)