6GEO3 Unit 3 Contested Planet Topic 5: Bridging the Development Gap

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6GEO3 Unit 3 Contested PlanetTopic 5 Bridging
the Development Gap
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What is this topic about?

• Bridging the Development Gap should be seen as
  complimenting the Superpower Geographies topic
• The two topics represent two sides of the same
  coin the rich and developing on one side, the
  poor and underdeveloped on the other
• The topic explores the causes and consequences of
  the development gap
• The last section of this topic focuses on
  solutions can the gap be narrowed?

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CONTENTS

• The causes of the gap
• The consequences of the gap
• Bridging the gap

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1. The causes of the gap

• The development gap relates to global inequality
• Around 2.8 billion people live on under 2 per
  day (moderate poverty)
• Some 1.1 billion people live on less than 1.25
  per day (extreme poverty)
• Over time a greater proportion of wealth has
  concentrated in the hands of the richest 20 of
  people, compared to the poorest 20 of people
  (see graph)

Since 1980, the percentage of people living in
extreme poverty has fallen from 40 to 20 of
world population, but because of population
growth the total number of people is extreme
poverty is still very high.
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Measuring development

• Measuring development levels is a challenge.
• Traditionally development has measured using
  economic data such as GDP or GNI per capita.
• These measures fail to recognise
• Income distribution
• The local value of money
• The non-money economy e.g. barter and exchange
• It is also important to recognise that
  development has social and quality of life
  aspects
• Measures such as life expectancy, education
  level, access to sanitation are important

This basket of goods costs 112 Indian Rupees in
India, the equivalent of 1.50. To buy the same
basket of goods in the UK would cost around 6.
The difference in how much goods and services
really cost, is why PPP (purchasing power parity)
GDP income is used rather than raw GDP. Using
raw GDP per capita average income in India is
about 1000, but PPP GDP per capita income is
2800
data for Dec 2009
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• As the development cable model (right) shows,
  development is a multi-faceted process
• At its core is economic development, but to
  achieve real progress social, political,
  environmental and personal development is also
  needed.
• Recognising the complex nature of development is
  why development is often measured using an index,
  which combines a range of data
• Indices are considered more accurate than single
  data points such as GDP per capita.

Physical Quality of Life Index (PQLI) Life
expectancy Literacy rate Infant Mortality
rate
The Human Development Index (HDI) Life expectancy
at birth Literacy rate Enrolment rate GDP
per capita PPP
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The Millennium Development Goals

• The MDG were adopted by the UN in the year 2000
• The MDG are a global attempt to measure, and
  actively improve, quality of life for the poorest
  people
• There are 8 Goals, with 21 targets within these.
  The target date to achieve the MDG is 2015
• The most famous Goals are
• Halve the proportion of people living on less
  than 1 a day
• Halve the proportion of people who suffer from
  hunger
• Achieve universal primary education
• Reduce by two thirds the under 5 mortality rate
• Progress has been patchy, especially in Africa
  and South Asia were the problem tend to be most
  acute.

Explore MDG progress and annual reports
at http//www.un.org/millenniumgoals/
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The development gap

• The geography of the development gap is more
  complex than a simple North-South divide
• Latin America has HDI levels similar to eastern
  Europe Chinas HDI and some others in SE Asia
  are relatively high
• South Asia has a concentration of levels below
  0.6
• Level in the Middle East are relatively high,
  although not in Yemen, Syria and Iraq
• The picture for Africa is very complex, with the
  extreme north and south having decent HDI levels,
  but some regions with shockingly low numbers

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Core and Periphery

• Some countries remain largely unconnected to the
  modern globalised world.
• This is especially true in Sub-Saharan Africa ,
  which remains very much part of the global
  periphery (see map)
• Other peripheral regions include north South
  Asia, the Andean region, parts of East and
  Central Asia.
• Growth areas (upward transition) are much better
  connected to the global core areas.

Sub-Saharan Africa has a range of factors which
make development very challenging these include
debt levels, landlocked states, conflict,
corruption, Aids/ HIV, malaria, lack of
infrastructure and communications, low education
levels, drought and many others
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Global Players

• There are a range of players involved in the
  development process

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Trade and development

• Trade is important to development, because it
  generates income.
• Least developed countries play a limited role in
  trade
• LDCs tend not to be part of trade blocs, so their
  exports are subject to tariffs
• LDCs often export commodities, the price of which
  fluctuates wildly (see graph)
• Cheap commodity export earn few Dollars, but
  Dollars have to be used to import manufactured
  good this creates poor terms of trade (see
  picture)
• Much of the value of the products we buy is added
  outside the country which supplied the raw
  materials

The 49 least developed countries account for only
0.9 of world trade, but have over 700 million
people
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2. The consequences of the gap

• The development gap means that poverty is common
  in least developed countries, especially in
  Sub-Saharan Africa
• In many countries males still have more access to
  education than females, and this has an impact on
  opportunities later in life (see diagram for
  Pakistan)
• In some situations, such as the Indian Caste
  system (still prevalent in rural India see
  pyramid), society has built inequality into the
  social system

The African countries shown all have infant
mortality rates of over 80/1000 live births, and
under 5 mortality of over 100/1000 Sierra
Leones 2008 rates were 160 and 278
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Megacities

• Poverty and lack of opportunity is often most
  acute in rural areas
• However, developing world megacities contain
  growing concentrations of urban poverty
• Some 1 billion people live in urban slums, likely
  to grow to 2 billion by 2030
• Slums often have
• Poorly built, shack housing
• Limited and expensive water supply
• Limited sanitation
• Informal, unreliable employment
• Lack of rubbish collection
• Social problems such as disease, crime
• Few services such as education and health

A UN-Habitat report in 2006 stated there was
concrete evidence that there are two cities
within one city one part of the urban
population that has all the benefits of urban
living, and the other part, the slums and
squatter settlements, where the poor often live
under worse conditions than their rural
relatives.
see the rural urban data for Pakistan and
Guatemala on previous and next slides
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Ethnic and religious dimensions

• Ethnic and religious minorities often suffer
  worse poverty than the wider population
• The data for Guatemala show a large different
  between poverty rates for Native Indians and the
  White Hispanic population
• Such differences can result from subtle
  prejudice, and direct discrimination and
  persecution
• In South Africa, the long history of apartheid
  has left a legacy of stark differences between
  black and white populations
• Often different ethnic groups live in different
  geographical areas e.g. white gated communities
  versus black townships in South Africa

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East Timor

• East Timor (Timor-Leste) was a Portuguese colony
  which gained independence in 1975, and was
  invaded by Indonesia in the same year.
• Indonesia occupied East Timor until 1999 East
  Timor regained its independence in 2002.
• The Indonesian campaign against East Timorese
  resistance fighters involved forced resettlement
  of 1000s of people into camps
• The death toll from fighting was high
• Portuguese was banned
• Around 150,000 Indonesians were settled on East
  Timor as part of the Transmigration Programme
• Most businesses were taken over by Indonesians

Indonesias occupation created a dual population
of poor Timorese and better off Indonesian
migrants, reflected in the post-independence
differences in HDI and income
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Poverty reduction at a price?

• The pressing need to reduce poverty has led some
  countries to go for growth
• Both China and India (and the Asian Tigers
  before them) have opened their economies to world
  trade and investment
• This has created employment, raised incomes and
  reduced poverty

• Social and Environmental Issues
• Increased rural v- urban inequality
• Mass rural-urban migration and rise in urban
  slums
• Increased air and water pollution from industry
• Stress on forests and water supply as resource
  demands rise
• Possibility of rising debt financial crises
• Social problems urban crime and disease
• Worker exploitation and human rights abuses
• Breakdown of traditional family structures and
  community support

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3. Bridging the gap

• How should the development gap be bridged?
• This question is important because there are a
  number of different approaches that might be
  taken
• The choice of approach is influenced by political
  viewpoint

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Strategies

• Development projects are often characterised as
  either top-down or bottom-up (see the next
  slide for examples)

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• These three projects show contrasting strategies.
• A is a small-scale, bottom-up intermediate
  technology project
• C is a classic top-down big project with
  clear winners and losers
• B is less easy to pigeon-hole as it is a
  national scheme, hi-tech, but aimed at the
  poorest and led by an NGO with a private partner

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Aid

• Aid means assistance given to the developing
  world
• Aid can be in the form of money, food, goods,
  advice and technical assistance
• Aid comes from a variety of sources (see
  diagram).
• Development Aid given by OECD countries is termed
  Official Development Assistance (ODA)
• An UN target of OECD countries giving 0.7 of
  their GDP as ODA has existed for 40 years, but
  few countries actually give this amount (2006
  data)
• OECD average 0.45
• USA 0.17
• UK 0.52
• Sweden 1.02

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Investment

• Flows of money to the developing world may be in
  the form of aid, but investment is important
• When companies and TNCs invest in the developing
  world this flow is called Foreign Direct
  Investment (FDI)
• FDI is motivated by profit
• FDI is used to set up factories fund construction
  in the developing world
• Most FDI flows towards NICs and RICs because they
  have a skilled workforce, and large markets
• There are question marks over the environmental
  and social value of FDI is relation to pollution
  and worker rights

Governments use Export Processing Zones (EPZs)and
Free Trade Zones (FTZs) to help attract FDI.
China has over 50 of these. In these zones
foreign investors receive special tax breaks,
rents are low and unions are often banned.
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• Some of the least developed countries face stark
  development choices
• In order to qualify for debt relief under the
  HIPC scheme they must undertake structural
  adjustment policies (SAPs)
• Critics argue that World Bank and IMF sponsored
  SAPs and HIPC are simply another way of OECD
  countries controlling the least developed world
• Others say Washington Consensus reforms open
  countries and workers up to exploitation by TNCs
• The counter argument is Look at China

• The Washington Consensus
• This is a set of economic reforms which the WB
  and IMF advise developing nations to undertake as
  part of a SAP to qualify for debt relief, and to
  help development. The reforms include
• Cutting public spending
• Currency devaluation in some cases
• Removal of import / export barriers
• Opening up to FDI
• Removing subsidies
• Privatisation and deregulation
• The aim of these policies is to help a country
  enter the global economy and benefit trade.

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Fair trade

• There are alternatives to FDI and Free Trade
• Fair-trade is perhaps the most well known
• Fair-trade coffee, cocoa, cotton and tea farmers
  receive a fair price for their produce, above
  market prices.
• The extra money improves income and some moneys
  is invested in community health and education
  projects
• Fair trade has grown and spread, but how much
  difference does it actually make?

In 2008 fair-trade coffee sales were 1.75 bil of
the global 70 bil market only 5 bil of that
70 bil went to the developing world

• Fair Trade coffee price 1.55 per lb,10 above
  market price.
• Growers get 50 per lb. after Fair Trade
  cooperative fees, taxes and farm expenses.
• Most farmers earn 1,000 (2.75 per day).
• According to Fair Trade researchers at the
  University of California, the price needed for
  farmers to rise above subsistence level is more
  than 2 / lb.

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Development futures

• Bridging the development Gap is a story of both
  good and bad news