Key Players in the Development Gap

THE UNITED NATIONS

• SET UP 1945
• 193 COUNTRIES

AIMS:

• keep peace throughout the world
• to develop friendly relations among nations
• to help nations work together to improve the lives of poor people, conquer hunger, disease and illiteracy and encourage respect for rights and freedom 

FOCUS ON ALL AREAS OF DEVELOPMENT INCLDING HEALTH (WHO), DEVELOPMENT (UNDP), FOOD AND FARMING (FAO) AND ENVIRONMENTAL ISSUES (UNEP)

HELP TO MONITOR THE MDGs, HELP IN DISASTER RELIEF AND WITH LONG TERM AID 

THE WORLD BANK

INCLUDES 4 KEY INTERNATIONAL INSTITUTIONS IN DEVELOPMENT:

• The International Bank for Reconstruction and Development (IBRD) 1944
• International Development Association (IDA) 1960
• International Finance Corporation (IFC) 1956
• Multilateral Investment Guarantee Agency (MIGA) 1988

SINCE 1950 THE WORLD BANK HAS LENT MONIES TO GOVERNMENTS OF DEVELOPING NATIONS AND IS CURRENTLY THE MAJOR SOURCE OF FINANCE FOR DEVELOPMENT N THE THIRD WORLD, FINANCING OVER 1900 PROJECTS. 

1980s - INTRODUCED THE STRUCTURAL ADUSTMENT PROGRMMES (SAPs) WHICH AIMED TO HELP DEBT REDUCTION BY PROGRAMS OF POLICY AND INSTITUTIONL CHANGE TO MODIFY THE STRUCTURE OF THE ECONOMY

SINCE CRITICISM OVER THE LACK OF ENVIRONMENTAL CONCERN THERE IS NOW A MUCH GREATER SUSTAINABLE ASPECT TO THEIR POLICIES AND PROJETS

INTERNATIONAL MONETARY FUND 

• 187 countries
• uniquely placed to help member governments take advantage of the opportunities - and manage the challenges - posed by globalization and economic development more generally

IMF TRACKS GLOBAL ECONOMIC TENDS AND PERFORMANCE, ALERTS ITS MEMBER COUNTRIES WHEN IT SEES PROBLEMS ON THE HORIZON AND PASSES ON KNOW-HOW TO GOVERNMENTS ON HOW TO TACKLE ECONOMIC DIFFICULTIES

THE IMF PROVIDES POLICY ADVICE AND FINANCING TO MEMBERS IN ECONOMIC DIFFICULTIES AND ALSO WORKS WITH DEVELOPING NATIONS TO HELP THEM ACHIEVE ECONOMIC STABILITY AND REDUCE POVERTY

IMPACT ON DEVELOPMENT

+ can provide investment for economic and social projects to improve standards of development within countries

- seen by some as 'top-down' approach with little regard for local needs

- seen to have exploited poorer countries with the use of SAPs in the past

- much of the World's debt is owed to the World Bank and IMF  

WORLD TRADE ORGANISATION (advise and assist)

• founded 1948
• designed to encourage free trade and prevent trade ward

THE WTO HOLDS MUTILATERAL TRADE NEGOTIAIONS KNOWN AS ROUNDS IN WHICH ARRANGEMENTS ARE NEGOTIATED AND DISPUTES RESOLVED

DECISION MAKING IS BASED ON OVERALL CONSENSUS

HUGE AMOUNT OF THE WORLD TRADE IS NOW CONTROLLED BY A FEW TNCs BUT THESE ARE LARGELY UNTOUCHED BY INTERNATIONAL REGULATION INCLDING THE WTO 

TRADE BLOCS e.g. EU and NAFTA, ASEAN

• set up as a way to encourage countries to trade with each other by offering comparative advantages e.g. something that makes that country unique
• for example: Saudi Arabia = oil, UK = high qualified employees, Japan = electronics
• trade blocs offer 'free trade' for member companies
• they eliminate taxes and tariffs on all goods imported and exported by member countries

IMPACT ON DEVELOPMENT

+ can promote trade between developed and developing countries

+ can raise standards of business practice and improve competitiveness of MDC companies

- can encourage trade dependency or create barriers to free and fair trade agreements 

TNCs

• due to the process of globalisation TNCs are investing in NICs in the developing world to manufacture products cheaper (FDI - Foreign Direct Investment)
• they are offered incentives to set up in some countries e.g. special export zones e.g. free trade areas
• sometimes the TNCs will offer the country incentives in order for them to be set up in a certain region
• Africa does not get much FDI due to unhealthy and unskilled/educated workforce
• there is concern over the dominance of TNCs within international trade and the economic strength of these compared with whole nations e.g. Shell in 1990 has a gross income which exceeded the combined GNP totals of Tanzania, Ethiopia, Nepal, Kenya and Pakistan 

IMPACT ON DEVELOPMENT

+ provide employment and investment in a country/region

- may exploit workers in developing countries to maximise cheap labour source and stay globally competative 

- leakage of funds back to parent company - how much does the LDC actually keep?

GOVERNMENT OF PARTICULAR COUNTRIES 

• developed world governments provide funding for UN, WB, MF and also aid to LDCs via Official Development Assistance (ODA)
• 1960s: most governments in developing countries took control in the development and implementation of development - many build up large scale public utilities, mining, agricultural enterprises
• but by late 1970s: countries in debt because state spending had grown faster than GDP so further state investment was only enabled by borrowing from commercial or multilateral sources
• late 1980s: response to the economic crisis: a new economic thinking gained president: market rather than the state = prime instrument for economic development 
• meant change towards regeneration of the economy + debt reduction 
• challenge for WTO: enhance capability of the state to undertake and promote collective actions more effectively - provide an appropriate foundation for markets 

IMPACT ON DEVELOPMENT

+ regulate the economy (e.g. by controlling interest rates) to make the most of market opportunities, attract inward investment and maintain competitiveness 

+ create the right conditions for business to flourish

+ provide physical infrastructure to support further development 

+ supply public services such as health and education

- decisions can be affected by politics and existing alliances 

Humanitarian bodies and charities e.g. Unicef, Oxfam

• charities and campaigning oraganisations which exist to serve the needs of third parties and to provideaid to developing countries (usually on a smaller and more localised scale)
• this is seen as a route to an alternative development that is more democratic, efficient and sustainable. In this way new relationships between community organisations and other institutions are developed
• Since the 1970s the term empowerment is used by the development community to refer to 'something more than participation'. This involved encouraging participation by local people in development through activities, however this often meant little real difference in policy making or planning at local communities

Humanitarian bodies and charities e.g. Unicef, Oxfam

• Empowerment is a desired process by which individuals, particularly the 'poorest of the poor' become agents of their own development. This entails creating power among local communities through education and the promotion of an understanding of the actions that they may take
• Examples of this include the CAMPFIRE PROJECT in Zimbabwe where land is held in trust by the community rather than under individual ownership.This allows the community groups to receive benefits of money through tourism, as well as bearing the costs of living with wildlife
• some NGOs receive funding from governments - others do not

Impact on Development

+ non-biased assistance to development projects or relief programmes

+ can be involved where global politics keeps out governments

+  a bottom-up approach which takes account of local needs

- NGOs rely on funding which may be unreliable

Individuals and Communities

• As  consumers and voters, individuals can alter government policy both in the developed and developing world
• Community led development (grassroots) is becoming more common and popular e.g. Bottom-up
• Developed world consumers may support fair trade

GOVERNMENTS

• don't have to listen to the local people, and don't even need their support if they are a dictatorship (mostly LDCs)
• can stop TNCs investing in their area
• they are the ones that put in place policies
• don't have to listen to international organisations
• other groups don't have power like they do