Key Idea 1: Inequalities in Economic Development
- Colonialism in Africa and America (15th - 19th centuries).
- Artificial boundaries caused tension within one nation with huge ethnic differences.
- Average growth of 8% per annum.
- Top 10% of wage earners make 12 times more than the bottom 10%.
- North-west (Punjab, Haryana), Bengal, and western states have relatively high incomes.
- Central band (Bihar, Orissa, Madhya Pradesh) have half of wages. Highest income state has 3 times the income of poorest state.
- Wealthy areas have remained so since colonialism (Kolkata, Delhi, Mumbai). Have been able to develop due to high incomes per capita and trade links/port access.
- British expoloited agriculture in the north, so arable land is used successfully. Good georaphical positioning. Has helped them survive.
- Kerala has managed to improve thanks to plitical management - invested heavily in education and healthcare, highest literacy rates of 93%. Land reform programme has also produced lowest levels of rural poverty.
- States like Bihar and Madhya Pradesh have struggled to develop because British didn't invest in poor soils.
- Rapid urbanisation in cities due to migration/pull factors, and huge inequalities.
- 52% of Delhi live in slums.
- Social inequalities - caste, gender.
- 94% of female workers in India are in informal work.
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Key Idea 2: Approaches & Attitudes towards Trade (
- Protectionism: allows countries to protect industries within the country from cheap imports. Trade barriers, import quotas, import tarriffs, government subsidies.
- Import-led trade.: trade barriers, not participating in free trade. Minimum international trade, domestic markets develop, few exports.
- Export-led trade: FDI by TNCs.
- Free trade: no barriers.
- Fair trade: high standards regarding prices paid to producers and benefits they receive.
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Key Idea 2: Approaches & Attitudes towards Trade (
- Export-orientated free trade.
- Protectionist approach before 1991, when IMF gave conditions to liberalise.
- Trade now 43% of India's GDP.
- Free trade has led to the growth of technology, bio-technology, insurance and financial instiutions in Hyderabad. Attractive to companies because of educated workforce, cheap wages, English-speaking.
- Hyderabad has emerged as a pharmaceutical and biotechnology hub, has led to an increase in ancillary activities and has created 3 times higher the employment services.
- Increased spending power due to migration.
- Extremely densely populated - one of 5 most concentrated cities in India. Housing expensive.
- Rapid urbanisation - increased air polluation, industrial waste, noise pullution, wate pollution. Shrinking grounwater levels.
- Influx of cheap products from MEDCs means local farmers are going out of business. Families in poverty.
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Key Idea 2: Approaches & Attitudes towards Trade (
- Gumutindo Coffee Cooperative works with over 3,000 individual farmers.
- Members attend quality improvement seminars and practice traditional cultivation methods.
- Cooperative receives a stable guaranteed price.
- Higher product prices serve for fund training and certification. Promotes more sustainable farming, farmers earn aditonal premiums.
- Cupping lab opened so farmers can roast their own coffee beans.
- Members decide how to invest premium payments. (e.g. repairing roads).
- empowers omen, as must be at one man and one woman as village representatives.
- May cause conflict - jealousy from those not involved.
- Reliant on the willingness of MEDC populations to buy/sell more expensive Fairtrade coffee.
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Key Idea 3: FDI (India)
- IT companies.
- Coca-Cola .
- Gap, Primark.
- IT FDI has created $60 bn benefit to Indian econom since 2009.
- Development of skills has led to establishment of India multinational IT companies (Infosys) - employs over 100,000 people worldwide.
- IT FDI employs young workers -higher disposable income in surrounding economy.
- Coca-Cola - invested $2bn in its operations in India and employs 25,000 people.
- Westernisation, loss of cultural identity.
- Country is vulnerable to relocation if FDI companies.
- Increasing inequality between rich and poor.
- Coca-Cola - water shortages, pollution.
- Clothing manufacturing - child workers (Gap Kids).
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Key Idea 3: FDI (Uganda)
- Increasingly popular for FDI, particularly for agriculture.
- 149,000 jobs created in 2010.
- Contains the world's largest integrated tea company.
- Indian professionals set up businesses such as hotels, which provide lots of jobs.
- Jobs lost as land is lost. Illegal eviction of Ugandan peasants form arable land without compensation or consultation.
- Most FDI is agriculture, low-skilled manufacturing, limited jobs and jobs are low-paid.
- Tension as traditional cultures and language are tainted.
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Key Idea 4: Globalisation affects economic develop
- Effects can be positive and negative.
- Decisions made in one part of the world have consequences in another.
- Coffee-producing countries set up International Coffee Agreements which stabilised the market - increased income for uganda.
- Poor weather conditions in 2010 - Uganda earned more for their cotton due to a shortage.
- Fish from Lake Victoria been banned in the EU on 2 occassions due to health and safety concerns. 3 out of 11 factories were closed, others only operated at 20% capacity. 70% of directly employed people were laid off. (35,000 employees)
- In 1989 the quota system was suspended as the US pulled out of the International Coffee Agreements - markets flooded with reserve coffee, coffee prices halved and devastated uganda's economy.
- Vetnam's coffee production rose by 1,400% in the 1990s.
- Indian cultural clashes - increasing violence between genders and low/high income groups.
- Reported cases of **** in India have more than doubled in the past 20 years. 'Western' culture.
- Some argue that criminals aroften young, poor, unskilled and illiterate men who are getting left behind in rapid development, angry and resentful.
- Nigerian violence - terrorism increasing as Boko Haram punish any Westernisation of the country.
- V`iolence may damage the economy in regards to FDI.
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Key Idea 5: Technology (Solar Panels)
- Solar Energy: The Alternative Energy Development Board in Pakistan launched Solar Home Systems in 2003 and fitted 100 homes with solar panels. Provideed lighting, cooking and water disinfection.
- Technological leapfrogging - cheaper for Pakistan t install solar panels than to build a power station and power system for remote villagess.
- Barefoot College in Idia trains women to assemble and install solar energy. Gives skills and empowers them.
- Conflicts in families with women attending Barefoot College - difficult to find willling women.
- Vilages depend on charity or government support to build solar panels as they are expensive.
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Key Idea 5: Technology (Mobile Phones - Afghanista
- Mobile phones: techonoligcal leapfrogging - avoids the cost of laying cables across vast areas.
- In 2008, 68% of the world's mobile phone subscriptions were in developing countries.
- Over $1 billion of FDI has one into networks - over 25% of the country has coverage and 12% own a mobile.
- Improved geographic accessibility - calls are cheap.
- Access to banking and microfinance increased - money can be transfered by text or voice, helps the illiterate.
- Families can keep in contact and send remittances.
- Farmers can discover the priceo f products at makets beforehand.
- Afghanistan's IT and telecommunications industry employs over 50,000 people.
- Allows businesses to order goods more cheaply as they don't have to visit cities to gain them.
- Fear of new technology and Westernising influence - women banned from having phones by local leaders in some communities.
- The Taliban have found a way of using mobile phone signals as remote detonators for IED bombs.
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Key Idea 5: Technology (Mobile Phones - Africa)
- 500 million phones used.
- Mobile networks like Safaricom and Vodafone have introduced 'M-Pesa' - allows people to store money in phones and bank.
- An engineering student at the University of Nairobi developed an automated fishing trap which uses sounds of fish feeding to attract fish and sends a text to fisherman. Now developing a control system to ensure it doesn't cause overfishing.
- Also being used to improve health - Mobile Alliance for Maternal Action (MAMA) sends messages to mobile phones of women in LEDCs to educate them about their health. Can be text or voicemail, covers pregnancy in the first year of a baby's life.
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Key Idea 5: Technology (GM Crops)
- Could potentially stop famines, meet the world's growing population's food needs, contain medicines within crop.
- Mainly done by private businesses that need to make a profit. Monsanto spends £600 million a year developing seeds, needs to recoup costs in sales.
- Farmers using Monsanto seeds can be charged premiums up to 35% for GM varieties.
- Only wealthy farmers can afford them, or poorer farmers get into debt to buy them to compete.
- Many farmers in India have commited suicide due to high levels of debt after buying GM seeds.
- Monsanto have made seedless varieties - farmers buy new seeds every year, increases company's profits but puts financial strain on farmers.
- Organic Consumers Association - effects of eating them long-term not tested.
- Greenpeace - potential environmental impact if GM crops escape into wild and mix with non-GM crops.
- Golden rice - Taiwan and the Philipppines, rice ciontained added vitamin A, but only low levels - would have to eat a lot of rice ro get RDA but only 2 tablespoons of sweet potato or one mango.
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Key Idea 5: Technology (Medical Advances)
- Solutions to illnesses such as HIV or Malaria could have a huge impact on development.
- Similar to GM crops, most medicines are developed by private companies whoneed to profit.
- Big issues over anti-retroviral drugs to manage HIV as companies (e.g. Abbott) sell their new drugs at high rates of $10,000 per patient. Individuals and governments can't afford these drugs as most of the world's HIV patients live in Sub-Saharan Africa.
- Companies are researching illnesses such as Cancer and Diabetes for MEDCs instead as they can afford the drugs at high costs.
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Key Idea 6: Aid affects economic development
- Aid programmes are most effective when they are integrated into national development strategies. (One named country)
- There are contrasting views about the ability of aid programmes to deliver economic development. (Two contrasting examples of aid programmes)
- India's National Rural Livelihoods Project (NRLP) & Fair Trade.
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Key Idea 6: Aid affects economic development (NRLP
- India has 45 million rural households in absolute poverty.
- The World Bank has invested $1.5 billion in 7 states since 1999, and $7 billion has been added by commercial banks and the government.
- Women from the poorest households are encouraged to form Self-Help Groups. They form savings groups and decide who needs the most support, and can ask for funding from the government.
- Groups feed into Village Organisation, then into a Sub-district Federation - young professionals.
- Improved access to government support (pensions).
- 13.5 million households have mobilised into 1.2 million community institutions and have collectively save $1 billion.
- Farmers have achieved 20-30% higher prices through collective marketing and improved techniques.
- In Madhya Pradesh there was a 65% increase in net income
- In Bihar households own 12.5% more land.
- Women have become empowered and formed pressure groups – in Bhusia Village women complained to labourers about an unfinished drainage scheme.
- Issues over fairness of participation – only the most vocal/dominant get their schemes approved?
- There may be many households above the ‘poorest’ threshold but still experience poverty and can’t benefit from the scheme.
- It has caused conflicts in some households – domestic violence, women ‘wasting precious money in savings groups’.
- Corruption is possible among officials as money comes from above, may only lend money to schemes they support.
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Key Idea 6: Aid affects economic development (Fair
- India: It could open a huge new market for fair trade famers within India,stability against foreign exchange flctuation.
- Indian market increasingly important as could be larger than the European market. e.g. Chetna Organic Farmers Association - works with 9,000 cotton farmers, sells most of its cotton to Europe with a premium, but is only able to sell half, must sell the rest in India without premium.
- Producers are paid a fair trade premium - additional funds for social/economic development projects. (Built a storage warehouse for their cotton, rents it out during off-season). In Kerala, premiums have been used to create a fund for distressed farmers and solar sensing technology to protect crops from elephants.
- Requires customers to understand Fairtrade and be willing to pay more. Indian market small as not concerned with it.
- Might just ease consumer guilt rather than providing a long-term solution to unfairness.
- Not enough customers who support the strategy for it to solve poverty on a large scale.
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Key Idea 6: Aid affects economic development (Indi
- One rthird of the world's pooret people live in India and there is a moral argument for aid based on the proven returns from internventions to combat poverty.
- Withdrawing aid will only affect the most vulnerable of Indians.
- Indian government government is corrupt, but better than other countries who've been given aid (87 out of 178 in Transparency rInternational ranks).
- Spce programme can improve agricultural monitoring, strengthen communication and other development.
- Some argue that UK aid is a Trojan horse for neo-colonialists, but only contributes 0.028% of economy.
- India's GBP is expected to outstrip the UK's by 2022 so they should start solving their own problems - invests a lot in arguably unneessary projects (e.g. space programme).
- Now gives more foreign aid than it receives - silly to be still giving it aid.
- Corruption of aid money is a huge problem. £70 million of the £388 million given by Britain towards a national flagship education programme has been squandered through widespread corruption and theft.
- Aid money is spent on infrastructure such as school an dhospitals but not increasing parent's income so they can afford to send children to school.
- Aid is being used to build relationships with Indian buinesses.
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