1. Obstacles to Development
REASONS WHY THINGS DO NOT GET BETTER

2. GOVERNMENT
The decisions governments make particularly in terms of public spending
The economic / political ideology
The level of corruption
The amount of bureaucracy and hindrance to private enterprise
The accountability of government to its people
Security and the rule of law

3. Vicious cycle of political instability

4. Access to Capital Without access to capital businesses cannot grow.
No property rights and no legal status for your business 
no access to credit no capital to invest in the growth of your business no possibility for growth and expansion  low revenue low profit

5. Disease
Diseases such as Malaria and HIV/Aids reduce the productivity of a country.
Death rates among economically active population are increased, people are too sick to work or caring for the sick.
High levels of disease, infant mortality rates and fertility rates can be related to poor provision of health care

6. Natural Hazards Back to the idea of environmental determinism.
Natural hazards can be an obstacle to development.
Drought (Ethiopia mid 1980s), 2004 Indian Ocean Tsunami impact on Indonesia, regular flooding in Bangladesh, tropical storm damage in Caribbean.

7. Inaccessibility
Map shows number of days travel to nearest city.

8. Landlocked and poor
Countries with coasts and deep sea ports are able to import and export products easily and therefore be more integrated into the Global Economy.

10. Top container ports

11. Unfair Trade and Protectionism
Subsidies paid to producers in MEDCs and trade barriers and protectionism limiting access to MEDC markets for LEDC producers are seen as major obstacles to development.
*Subsidies: A benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction

12. Unfair Trade and Protectionism
Levels of protectionism are high in the global economy and many analysts argue that the rules of the Global Economy were made by MEDCs for the benefit of MEDCs.

13. Trade – Benefits for all?
In theory trade should benefit all countries.
International trade has been going on for a long time, so why are not all countries rich?

14. Dumping
The rich world tells the poor world to get rid of subsidies, but continues to spend $1 billion a day subsidizing its own farming enterprises

15. Market Access
If Africa, East Asia, South Asia, and Latin America each increased their share of world exports by just one per cent, the resulting gains could lift 128 million people out of poverty

16. Forced liberalization
Millions of poor farmers in developing countries cannot earn a living because of cheap, often dumped, food imports

17. IMPACT OF AID AND DEBT RELIEF

18. Aid received, per capita, in 2007, in $ of Official Development Assistance per person. Note that grey countries can either be non-recipients or ones for which data is unavailable. The data were converted into dollars using exchange rates, hence may not accurately reflect the purchasing power of the foreign aid receive

19. SSA 1962 OWED 3 BILLION 1982 OWED 142 BILLION 2010 OWED 235 BILLION
NIGERIA 35 BILLION
COTE D’ IVOIRE 19 BILLION
SUDAN 18 BILLION

20. What are the different types of AID?
What is AID?

21. Aid is ...
Support
Goods
Services
Money
... given to those in need

22. What different types of Aid are there?
Duration: long-term, short-term, emergency
Delivery: financial, goods, services from trained people
Source: government, non-governmental organisations (NGO’s), charity, individuals
Dependency: tied aid

23. What is top- down development?
These tend to be big schemes and decisions are made by the national government. Local people who often live near the scheme do not get involved in the process Examples:

24. Top Down Decision Making
External Groups
e.g. World Bank, TNCs
National
Government
Top Down Decision Making
Local People

25. What is bottom-up development?
Local people are fully involved in the process and decision making
Examples:

26. Bottom Up Decision Making
External Groups
e.g. World Bank, TNCs
Decision made here
National
Government
Local People

27. Top Down Approach Conditions often attached to the loans
Relies on external links and technology
Dams etc provide energy needed for the country to develop
Uses machinery etc rather than providing jobs for local people
Top Down Approach
Often environmentally effective as they use cheaper fuels e.g. HEP
Country gets into debt as it borrows money from the World Bank etc
As these areas grow the take away resources from peripheral areas

28. Bottom up Approach Involve the local people
Appropriate technology to the local skill level
Bottom up Approach
Low cost
Very limited impact of national poverty levels

29. Which are the best option?
Looking at both Top down and bottom up approaches to development, which do you feel are the best option and why?

30. Effective aid projects or not?
Government funding to Nepal – the UK Government recently gave £65 million to the Government of Nepal to use in its health services
Oxfam’s Let Agogo Project in Haiti – gives cows to people who care for the cows and sell on the dairy products to earn income
International Aid to Afghanistan – much of the international aid to Afghanistan is paid to foreign contractors for projects that do not meet the needs of the poor

31. Different Types of Aid (con’t)
Type of Aid
Description
Voluntary aid
Charities raising money for long term developments
Bilateral aid
Money given from one country to another for projects
Tied aid
The donor benefits (military bases)
Multilateral aid
International organizations (UN)
* Emergency aid: following a disaster

32. Remittances Global remittances are about $300 billion per year.
30 million Africans send appox. $40 billion annually from the countries of work to their home countries.
Up to 40 % of remittances to Africa are destined for rural areas
Problem: most money transfer centers are in urban areas.

33. Remittances

34. Poor Countries Debt Reasons for problems
low growth in industrialized economies
high interest rates between 1975 and 1985
increase in oil prices
falling commodity* prices
*any unprocessed or partially processed good, as grain, fruits, and vegetables, or precious metals.

35. What has been done? Structural Adjustment Programmes (SAPs)
economic policies for developing countries that have been promoted by the World Bank and International Monetary Fund (IMF) since the early 1980s

36. Structural Adjustment Programmes (SAPs)
SAPs believe the key is with international trade.
They consist of 4 main goals
greater use of a country’s resource base
Policy reforms to increase economic efficiency
Generation of foreign income through diversification of the economy and increased trade.
Reducing the active role of the state

37. Not everyone agrees

38. Stabilization Measures
Short term
Limit any further deterioration of the economy (wage freezes, reduce subsides on food)
Longer term
boost economic competiveness (tax reduction, export promotion, downsizing civil services, privatization and economic liberalization)

39. Heavily Indebted Poor Counties Initiative (HIPC)
The original focus of the HIPC Initiative was on removing the debt overhang and providing a permanent exit from rescheduling.
Also to promote reform and sound policies for growth and human development.
Launched in 1996 by the IMF and the World Bank.

40. Heavily Indebted Poor Counties Initiative (HIPC)
41 of the poorest and most heavily indebted countries, of which 33 are located in sub-Saharan Africa, are currently eligible to benefit from debt reduction under the enhanced HIPC Initiative.

41. Heavily Indebted Poor Counties Initiative (HIPC)
There are two main stages to the HIPC Initiative.
During the first stage the countries must adopt a number of measures in order to be considered for interim debt service relief (decision point).
Once accepted, they qualify for some interim debt relief and must implement certain policies and meet certain conditions in order to qualify for full assistance (completion point).
The process is very flexible, as there is no fixed timetable for the completion of the two stages.

42. Sustainable development
Sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.

43. “…without compromising the ability of future generations to meet their own needs.”
This is the concept of intergenerational equity.
It is important to remember that future generation’s needs will be greater than ours because of population growth and development.
It means that we inherit the Earth from previous generations and have an obligation to pass it on in a reasonable state to future generations.
Our generation should not use more than our fair share of resources

44. Environmental Quality can be measured using a range of indicators which basically quantify our impact on the environment.
Habitat loss, species extinction, biodiversity, air pollution, land degradation, water pollution, resource use, waste disposal, energy use and efficiencies, transportation, housing, recycling.

45. SO HOW MUCH DOES THE US SPEND