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

Economics- Portfolio

Free essay example:

ECONOMICS SL COMMENTARY NUMBER 4- Economics/1B

Title of extract: IMF exec sees Asia's developing nations 'moving up the ladder'

Source of extract: Business World Online

Date of extract: 22 March, 2010

Word Count: 690

Date the commentary was written: 24 March, 2010

Sections of the syllabus to which the commentary relates: Section 5- Developmental Economics

        This article addresses the structure, stability, and growth system of developing countries.  One major point this article makes that is important to note is that all developing nations have different, wide-ranging preconditions and problems.  However, most of the time, solutions to problems and main issues are similar.

        Specifically, the article addresses certain problems faced by struggling countries in Southeast Asia.  For example, the need for basic public services such as health-care, food and shelter. Stable programs like these are necessary for sustaining an organized economy and a strong government infrastructure.  The article mentions that increased integration into the global economy is a very important aspect in the growth process. What creates a stable economy is a country's ability to cooperate with other countries, balancing imports with exports. Boosting competitiveness is also a crucial aspect of making sure that a country creates a stable role in the trade system.  Most of these developing countries are in Southeast Asia; therefore, in theory it should not be too difficult for international cooperation to come from larger economies such as China or Japan.

        These reasons, however, are only some aspects of these developing countries that make it difficult for growth.  For example, many countries have large deficits and public debt, high credit growth as well as inflation.  These are signs of a highly unstable economy, and are big issues that must be faced soon, or else these factors will only increase in multitude.  As the article states, the Asian Development Bank speculates that these countries would need to invest approximately $8 trillion over the next ten years in order to gain more prosperity in the next upcoming decades.  Figure 1 displays the change in the standard aggregate supply and demand curves as these problems are not faced.

        According to the article climate change is one of the greatest long term risks for the developing countries, specifically in Southeast Asia, since it is one of the most vulnerable regions of the world.  In order for long term stabilities, these countries need to adapt to these climate changes in order to be successful in its growth process.  It is thought that if climate change is not addressed, Southeast Asia could lose about 6.75% gross domestic product each year.

        There are many causes for the increase in poverty in these countries.  The factors that affect the change in poverty are the distribution of income, inflation, failure to include environmental degradation, and failure to consider the kind of goods produced.  These factors are prevalent in these countries.  Research shows that these countries are not prominent figures in the international economy.  There is no specialization of goods in these countries.  The increase in national growth often times harms the environment.  Thus, countries that struggle with growing or grow too fast, have negative externalities, such as harming the land by over-fertilization, or destruction of land and resources.  Much of the poverty in these countries is caused by the high levels of inflation in the economy.  Because there is little specialization, people are struggling to make a living through their individual trades.  Therefore, there is a lot of inflation.

        Developing countries have a lot of issues they need to face.  Debt and high deficit among basic needs among the population are just some of the problems that need to be addressed over the next few months and years.  These issues are only going to be faced if these countries have cooperation from other more thriving economies.  Many of these developing economies have dug themselves into a huge hole of debt, and although government spending may not be very possible in a downturned economy, it is the only way that some of these issues can be solved.  If these issues are face, these countries in Southeast Asia could grow to become reasonable assets to the global economy.

This student written piece of work is one of many that can be found in our International Baccalaureate Economics section.

(?)
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

Related International Baccalaureate Economics Skills and Knowledge Essays

See our best essays

Related International Baccalaureate Economics essays

  1. GPD countries

    The hidden economy is all output produced within a country in an illegal or not declared way. These are all self-employed workers who do not pay taxes, all grandmothers taking care of children (nonmarketable services), farmers who grow food for their own use, etc.

  2. Macro Economics Notes

    For instance perhaps income levels in France are more equally distributed than UK. Perhaps UK is more expensive to live than France? Perhaps tax rates are higher in UK? Perhaps the informal sector is larger in France, which do not get included in the figures?

  1. International Economics

    Supachai said the single biggest development since the body's last gathering is that now "we are seeing real change in that the South will have to be taken more and more seriously." He pointed specifically to the prominent role countries like Brazil and India have taken in World Trade Organization

  2. Growth and Development Problem Set - IB Economics exam questions and answers.

    supply of resources, the state of technology, and the underlying economic institutions; the output level when there are no surprises about the price level.

  1. case study economics

    As provision of healthcare has an opportunity cost, it makes it an economic good and not a free good. (*** Economic good is a good that has an opportunity cost thus giving it a price and hence making it scarce.)

  2. LDC Essay Economics Barriers to Growth

    That said however, while increased saving and investment may be necessary, it is not sufficient for growth. Many of the complementary factors required for growth may well be lacking in an LDC, the necessary structural, institutional and social conditions eg money markets, transport networks, skilled labour, and efficient administrations.

  1. Extended Essay Economics

    Globally, the dollar is the currency most frequently used in international trade; it for this reason that the effect on the pharmaceutical company and other firms is so significant. Apart from the individual firms, the exchange rate directly affects the prices consumers have to pay to purchase certain goods. II.

  2. 15 Historical Economic Questions on Mercatilism and the Development of European Countries.

    The race aimed to achieve the highest accumulation of precious metals through importations. Also unknown at the time was that the importations of precious metals were actually hindering their opportunity for accumulating ?real wealth?. Real wealth was claimed by Smith to define the annual produce of the land and labor of a society.

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