• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Assess some of the ways in which Third World Debt might be reduced

Extracts from this document...

Introduction

Assess some of the ways in which Third World Debt might be reduced. Despite the overwhelming number of statistics and indicators, global poverty is as hard to measure as it is to conceptualize. One fact is undeniable: someone is going to have to pay for past debts. It could be the people in debtor countries, or the banks, or the people in advanced industrial countries. Most likely it will be some combination of these three groups. In the last ten years, there have been a variety of proposals which, unfortunately, usually reflect only the special interests of the groups proposing them. Generally speaking, these solutions fall into three categories: repudiation, minor adjustments in repayments, or reduction. A report "Relief Works: African proposals for debt cancellation - and why debt relief works" examines public spending in 10 African countries which have benefited from debt cancellation. It reveals that total spending on education in these countries has increased, and is now twice the amount that is being paid to foreign creditors. ...read more.

Middle

The escalation of economic warfare would have the effect of sharply reducing international economic interactions in trade, investment, and exchange. Such an outcome is in no one's interest. There is nothing to guarantee that the countries won't simply get into debt all over again and continue to owe more allegiance to first world elites than to their own people. Repudiation also let's off the hook the World Bank, IMF and commercial lenders who created these injudicious loans in the first place. Another option would be to cancel debt with conditions. Part of the cycle is that as countries get deeper in debt and grow more impoverished as they try to repay, the lenders impose a whole new range of what they say are anti-poverty and anti-corruption conditions, but which most often have other agendas, such as opening up poor countries to multi-national companies. Therefore a proactive proposal that meets several criteria needs to be developed in order for this method to be successful. ...read more.

Conclusion

This need not, and should not, be the case. The developed countries have a responsibility to create conditions whereby the poorer countries can interact more productively in international economic activities: their single most important contribution to this end might be in the area of reducing trade restrictions on the products of poorer countries. Similarly, the developing countries have a responsibility to see that money is more effectively utilized within their own borders. The obscene personal profits accumulated by such leaders as Marcos of the Philippines and Mobutu of Zaire should not be fostered by the strategic interests of other countries. The banks should also face up to the fact that their single-minded pursuit of profits almost led them to the brink of bankruptcy. The lesson to be learned from this experience is that for economic growth to be sustained, close attention must be paid to the mutual interests of all parties involved. Only after sustained economic growth returns to the heavily indebted countries can the international community even begin to determine manageable rates and methods of debt repayment. ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our AS and A Level UK, European & Global Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related AS and A Level UK, European & Global Economics essays

  1. Given the fact that Third World countries are underdeveloped (or developing); the causes that ...

    10 Even intellectuals would face the problem of lacking the valid knowledge of appropriate economic policies that serve their countries' financial and economic interests. Thus what is discussed on academic levels is not what takes place in the government discussions of trials to maximize GNP rates and thus new insights for development are not provided.

  2. Where does the World Trade Organisation fit in the overall scheme of international public ...

    Several developing countries have since proceeded beyond GATS commitments with further unilateral liberalisation in financial and telecom services.68 That said, there remains a wide gap (or "wedge") between applied measures of unilateral liberalisation "at home," on the one hand, and bound WTO commitments, on the other, as far as most developing countries are concerned.

  1. Should mortgage lenders be nationalised

    Worth mentioning is the fact that it was only after 16 years of Rolls-Royce emergent nationalisation in 1971, that all its shares were sold to private owner. What would happen if the mortgage defaults continued to rise though? What if the plan would fail?

  2. In what ways is the government attempting to increase the willingness to wor

    The general trend of the graph is that both inflation and unemployment have decreased over the years. When the British economy was in recession during the early nineties unemployment and inflation were very high. In 1990 unemployment was at just above 5% a few months later inflation hit a peak at nearly 8.5%.

  1. Will trading fairly reduce world poverty?

    Colonialism is simply, exploitation by a stronger country of weaker one; Colonizing nations generally dominate the resources, labour, and markets of the colonial territory, and may also impose socio-cultural, religious and linguistic structures on the conquered population (see also cultural imperialism)..

  2. This report will consider the opportunities and restrictions involved in exporting a single premium ...

    Single women generally receive less respect than married women. Most women are engaged in secretarial job, assembly or education work. Foreign businesswomen however seem to be exempted from these traditional ways of thought. Businesswomen especially (non-Asian looking women) are seen as equals to foreign businessmen.

  1. Explain the evolution and characteristics of the debt problems of LDCs. In the light ...

    debts by individual governments and commercial banks3, and aid donated to LDCs. Debt takes a number of different forms. Before the 1980's, much of the borrowing by LDCs, especially in Latin America, was in the form of bank loans from commercial banks, lent at commercial rates over 5-7 years.

  2. This investigation will try to test the level of external debt and measure its ...

    1.3 This investigation will try to test the level of external debt and measure its impact upon the countries economy. The research will be based on existent facts and figures, passed papers written on the particular subject and verbal remarks from individuals that have been involved in the negotiation of the countries debt.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work