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    Economic International Order Notes

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    Global economic inequality exists between developed and developing nations. Developed nations are more industrialized and have higher per capita income levels, while developing nations are less industrialized and have lower per capita income levels. Rich countries are many times richer than poor countries, though rich countries give billions in aid and poor countries pay billions in debt service to rich countries each year.

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    Economic International Order Notes

    Uploaded by

    api-463649666
    40 views2 pages
    Global economic inequality exists between developed and developing nations. Developed nations are more industrialized and have higher per capita income levels, while developing nations are less industrialized and have lower per capita income levels. Rich countries are many times richer than poor countries, though rich countries give billions in aid and poor countries pay billions in debt service to rich countries each year.

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    Global economic inequality exists between developed and developing nations. Developed nations are more industrialized and have higher per capita income levels, while developing nations are less industrialized and have lower per capita income levels. Rich countries are many times richer than poor countries, though rich countries give billions in aid and poor countries pay billions in debt service to rich countries each year.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    40 views2 pages

    Economic International Order Notes

    Uploaded by

    api-463649666
    Global economic inequality exists between developed and developing nations. Developed nations are more industrialized and have higher per capita income levels, while developing nations are less industrialized and have lower per capita income levels. Rich countries are many times richer than poor countries, though rich countries give billions in aid and poor countries pay billions in debt service to rich countries each year.

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    © All Rights Reserved
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    of 2

    Name: ____________________

    Economic International Order Notes

    Global Economic Inequality


    - Based on economics, the world has been divided into two types of countries
    - Developed nations are countries that are __________ industrialized and have higher
    per capita ____________ levels
    - Ex. ______________, United States, Japan
    - Developing nations are countries that are ____________ industrialized and have
    ____________ per capita income levels
    - Ex. Mexico, China, ______________
    - As stated by the UN: “the designations “_________________” and
    “_________________” are intended for statistical convenience and do not necessarily
    express a judgement about the stage reached by a particular country”

    - Rich countries are _______x richer than poor countries


    - Rich countries give about ________ billion dollars in aid to poor countries each year
    - Each year poor countries pay about __________ billion dollars in debt service to rich
    countries

    Debt Servicing
    - Money, like everything else, isn’t free
    - Debt servicing is the act of regularly ___________________ a debt, including ________
    - Interest is an amount of ___________ paid to the ____________ for the privilege of
    _____________ their money
    - For example, if the IMF loans Ecuador $10 million, it may expect them to pay back that
    $10 million over ten years (1 million every year), plus $50,000 each year in interest, for
    the privilege of being allowed to use their money

    Heavily Indebted Poor Countries (HIPC)


    - Less developed countries that are heavily in ___________
    - HIPCs owe debts to more ______________ countries and have _________ to no hope of
    repaying them
    - As long as they have unpaid debts, it is almost impossible for them to _______________
    any more money to fund ____________________ projects

    HIPC Debt Initiative


    - Established by the _____________ and _____________ in 1996
    Name: ____________________

    - Under this program HIPCs must agree to a number of _______________ in order to be


    eligible for debt ____________
    - These reforms often include _________________________ such as cutting government
    spending or following the principles of ________________________ capitalism
    - Debt relief is granted to an HIPC after it shows it has implemented and followed these
    reforms for three years

    Structural Adjustments
    - Structural adjustment is a term used to describe the policies requested by the IMF in
    ___________________ for financial aid (including through the HIPC debt initiative)
    - The policies are designed to tackle the ____________ of the problem and provide a
    framework for long term _________________ and ________________
    - These policies usually involve a combination of free-market policies such as
    _________________, free trade, and ____________________

    Criticisms of the World Bank/IMF


    - Operate under the assumption that the free-market system can bring
    _________________ to all countries
    - Free market reforms are not always ________________ for countries that are
    experiencing ______________, or for countries that are _______________ and do not
    have stable, democratic political systems
    - The IMF and World Bank are controlled by the ___________________ and other more
    developed countries whose main focus is to protect their corporations and
    ________________ rather than those of less developed countries
    - Could support countries that have poor __________________ records

    Canadian International Development Agency (CIDA)


    - CIDA is the government agency responsible for administering ____________________
    programs in less developed countries
    - CIDA’ s mandate is “to support ______________________________ in developing
    countries in order to reduce poverty and contribute to a more secure, equitable, and
    prosperous world.”
    - One of CIDA’s priorities is to promote human rights, democracy, and good governance in
    less developed countries

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