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WHAT IS AID?
the flow of resources from developed countries to the
developing world. Either a financial grant/material gift that
doesn't have to be paid back or through a loan with
interest…read more

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THE TYPES OF AID
Multilateral aid
Bilateral aid ·Involves the UK donating capital to agencies that
mostly give loans and not gifts Commercial
Banks
·The World Bank (all countries can join but US
· From the governments of economic interests dominate its policies. Gives
developed world to the loans with low interest to fund infrastructure
development)
governments of developing
world. Its known as `official
·IMF (most of the funding is from the US) · Lend money at
·European Commission (members contribute to the
development assistance' and European aid fund. This agency gives grants rather commercial interest rates
than loans and food aid is an important aspect)
comes from the UK's ·The United Nations (a small part of the UK's aid
Department for International budget is given to UN agencies such as UNISEF)
Development (DfID)
Non Government
Organisations Emergency
·Charities/ individual donations
associated with disaster relief or specific
projects. Only makes a very small amount
aid
in comparison to bilateral and multilateral
aid · Humanitarian relief in
·Oxfam and Save the Children Fund ­
raise donations by raising awareness of
response to a natural
problems faced in developing world disaster, famine or war.…read more

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THE UK AND AID
· The UN in 1969 recommended that 07% of a country's GNP should be
given in aid (this excludes military aid and loans).
· Very few countries (including the UK) have ever met this target.
· Although overall aid is growing ­ because of the financial crisis aid
slowed.
· Between 2004 and 2006 western banks increased lending. In 2007 these
private credit sources dried up and hundreds of billion dollars had to be
used to prevent the western financial system from collapsing.
· In 2013 the UK started a new `payment by results' approach whereby
countries only receive aid when progress is shown.…read more

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THE CONSEQUENCES OF THE FINANCIAL
CRISIS IN THE DEVELOPING WORLD
Toussaint (2008) predicted consequences of the financial crises for the developing
world.
1. manufacturing industry will suffer in developed world so demand for raw materials etc from
developing world will fall = less money to pay debts
2. As banks in developed world collapse/merge they'll be less likely to extend credit periods or
provide loans for developing world
3. migrant workers work in insecure parts of western economy e.g. construction. More likely to be
laid off in recession. Less money to send home. Less money flowing into developing world…read more

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THE THEORIES + AID
Modernisation Theory Dependency Theory
· aid is necessary for development · aid isn't to assist development
because it provides the money needed
for infrastructure development
· Both loans and grants are good because
· aid creates and sustains
they provide developing countries with underdevelopment to benefit
capital the wests wealth,
consumption and political
· aid is crucial for take-off into power
industrialisation - aid was spent on
developing industry and modernising
agriculture
· organisations such as the
· aid is also necessary for cultural change. world bank produce
It provides the capital for setting up a ineffective aid strategies that
meritocratic education system . benefit TNC's…read more

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