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


Title: Support and guidance - Unit 3, topic 5: Bridging the Development Gap Author: Kim Last modified by: Cameron JM Dunn Created Date: 9/1/2009 5:59:06 PM – PowerPoint PPT presentation

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

6GEO3 Unit 3 Contested PlanetTopic 5 Bridging
the Development Gap
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?

  • 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.
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
  • 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
data for Dec 2009
  • 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
  • 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
The Human Development Index (HDI) Life expectancy
at birth Literacy rate Enrolment rate GDP
per capita PPP
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
  • 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
  • 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

Explore MDG progress and annual reports
at http//www.un.org/millenniumgoals/
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
  • 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

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

Player Role
World Bank / IMF These two IGOs lend money to the developing world essentially funding development, and as part of this process guide economic policy (the IMF). Much of the developing worlds debt is owed to the IMF and WB.
TNCs Invest in the developing world e.g. building factories Foreign Direct Investment tends to flow to low cost locations, but where people are educated and skilled Africas share of FDI is therefore small.
United Nations Monitors the MDG, but has many component organisation which focus on development (UNDP), health (WHO), food and farming (FAO) and environmental issues (UNEP) often involved in disaster relief as well as longer term aid.
Governments Developed world governments provide funding for the UN, IMF and WB. They also provide bi-lateral aid the developing world in the form of Official Development Assistance (ODA). Developing World governments manage their countries path to development.
NGOs Charities and not-for-profit organisations provide aid to the developing world, often in a smaller, more localised way compared to Governments and IGOs. Some NGOs receive government funding
Individuals As consumers and voters, individuals can alter government policy both in the developed and developing world community led development in becoming more common developed world consumers may support fair trade.
Trade and development
  • Trade is important to development, because it
    generates income.
  • Least developed countries play a limited role in
  • 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
  • Much of the value of the products we buy is added
    outside the country which supplied the raw

The 49 least developed countries account for only
0.9 of world trade, but have over 700 million
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
  • 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
  • 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
see the rural urban data for Pakistan and
Guatemala on previous and next slides
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
  • 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

2001 Census Black South Africans White South Africans
Under 15 yrs old 34 19
No education 22 1
Households with a telephone 31 95
Adult mean income 1600 8800
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

East Timor Indonesia
Colony of Portugal Holland
Religion Catholic Muslim
Ave Income 2300 4000
HDI 0.49 0.73
Indonesias occupation created a dual population
of poor Timorese and better off Indonesian
migrants, reflected in the post-independence
differences in HDI and income
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
  • 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

(estimates of extreme poverty) 1980 2005
India 45 25
China 60 10
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
  • The choice of approach is influenced by political

Neo-liberal / Capitalist Marxist/ Socialist Populist Grassroots
China, Asian Tigers Cuba, Kerala (India) Venezuela / Latin America Community based
Market led development, following the Modernisation Theory of WW Rostow Stressing industry and infrastructure, free trade and attracting foreign direct investment to create jobs and raise incomes. Breaking free of capitalism and profit. State ownership and planning so that profits from industry and uses for health and education usually involves wholesale land reform . State control and limited involvement in world trade and TNCs Charismatic man of the people leaders create a them and us discourse promising social equality and using policies that appeal to the pockets of ordinary people Critics state populism is directionless and leads to poor economic decision-making Small-scale, community focussed development often aiming to meet basic needs rather than hugely improve incomes Often involves local or international NGOs who provide some funding and other support.
  • Development projects are often characterised as
    either top-down or bottom-up (see the next
    slide for examples)

Bottom up Top Down
Scale Small based on one community or area e.g. a valley Large often part of national planning aims
Leadership Community and NGOs partnership arrangements Government and government agencies construction and engineering TNCs
Funding source Local people and NGOs donations or earned income recycled into the community Government, via multilateral aid (WB / IMF) or bilateral aid private investment
Aims Meeting basic needs of food, health, education and water small improvements in income Meeting national needs in terms of energy or water supply, or transport profit
Technology Intermediate / appropriate Hi-Tech
Types of project Food production, water supply, small scale renewable energy Electricity, transport, industry and infrastructure
Winners Local people the environment Industry, urban dwellers, TNCs
Losers Usually are none Environment, rural people
  • 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

  • Aid means assistance given to the developing
  • Aid can be in the form of money, food, goods,
    advice and technical assistance
  • Aid comes from a variety of sources (see
  • 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
  • OECD average 0.45
  • USA 0.17
  • UK 0.52
  • Sweden 1.02

  • 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.
The top 10 developing world locations for FDI in 2007 (in millions). Notice the lack of least developed countries in the list The top 10 developing world locations for FDI in 2007 (in millions). Notice the lack of least developed countries in the list
China Hong Kong 1,511,000
Brazil 328,000
Mexico 266,000
Turkey 146,000
Chile 106,000
South Africa 93,000
Thailand 86,000
Malaysia 77,000
India 76,000
Saudi Arabia 76,0000
  • 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.

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
  • 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.

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

Good news? Bad news ?
In some countries, such as India and China, the gap has narrowed Debts have been reduced fro some HIPC countries, possibly giving them a chance of a new start Aid in 2008 was at record levels and many OECD countries seem serious about the MDG Some initiatives such as Fair Trade have helped, and NGOs often make a difference with bottom-up community led projects, but these need to be spread much more widely Progress has been made with some diseases such as Aids and Malaria In regions such as Sub-Saharan Africa little progress has been made and the gap has widened Many African nations will fail to achieve their MDG targets The 2008-09 recession may have tipped up to 200 million people back into poverty and hunger, reversing progress Aid may be less of a priority in the next decade as OECD countries struggle with their own financial problems Corruption, conflict and bad governance still bedevil may LDCs Neo-colonial relationships persist
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