Geography HL Essay:
Examine the strategies used in the transfer of capital between core and peripheral areas.
There are various strategies which are made use of when transferring capital between the core and peripheral areas. These are mainly loans and debt repayment, remittances, foreign direct investment and the repatriation of profits.
Loans and debt repayment is used worldwide in which the developing countries collectively owe $2.3 trillion to foreign creditors. The advantages brought by such a transfer of capital between core and peripheral areas is the opportunity countries get to finance necessary resources in order to build up and develop themselves by improving their education and housing in Sub-Saharan Africa for example. The total money owed has however been cut due to the HIPC plan which reduced the 218$ billion owed to $180 billion. As a result of these loans and repayments, food, clothing, housing, medicines and medical care became cheaper and simultaneously, their quality improved since earlier times. This as a result makes it easier and better for LEDCs to afford such resources, benefiting their standard of living and development of their economy. The loans and debts still however need to be repaid, and as a result countries will need to pay interest on this and pay back the principal. Even bad loans will have to be repaid, and especially for LEDCs this can suck money out of their economy.