Development and Globalization

Table of Contents

Introduction: What is Development? ....................................................................................................................................... 2

The Divide Between Developed and Developing Countries ................................................................................................... 2
Why Are Some Nations Richer than Others? ..................................................................................................................... 3
Geography .......................................................................................................................................................................... 3
Culture ................................................................................................................................................................................ 4
Property Rights ................................................................................................................................................................... 4
Lack of Freedom ................................................................................................................................................................. 4
Problems of Development Today ........................................................................................................................................... 5
Assistance for Development ................................................................................................................................................... 6
Institutions of Development..................................................................................................................................................... 8
Development Banks ........................................................................................................................................................... 8
United Nations Development Program ............................................................................................................................... 9
Government Aid Agencies .................................................................................................................................................. 9
Non-Governmental Organizations ...................................................................................................................................... 9
Community Management of Acute Malnutrition Programme, UNICEF ............................................................................ 11
Development Strategies........................................................................................................................................................ 13
Poverty Reduction ............................................................................................................................................................ 13
Trade-Not-Aid ................................................................................................................................................................... 14
Good Governance ............................................................................................................................................................ 15
Sustainable Development................................................................................................................................................. 16
Gender Equality ................................................................................................................................................................ 17
New Investment Strategies............................................................................................................................................... 17
Stories of Jeremiah Ugwu, Ifeanyi Okpaga, Cynthia Ukwegwu, and Simon “Monday” Aliome............................................ 19
Bibliography .......................................................................................................................................................................... 22

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 Development
Introduction: What is Development?
According to the World Bank, as many as half of the world's six
billion inhabitants live on the equivalent of less than $2 per day,
and about one-fourth of the world lives on the equivalent of less
than $1.25 per day (Chen & Ravallion, 2008). Meanwhile, people
in the 20 richest countries earn, on average, 39 times more than
people living in the poorest 20 states (Milanovic, 2007).

At the same time, the extent of world poverty has declined

significantly during recent years. For example, the World Bank
estimates that from 1981-2005 the percentage of people living
on less than $1 per day was halved, decreasing from 52 percent
to 26 percent during this period (Chen & Ravallion, 2008).

These contrasting trends highlight both the problems and the

progress associated with the process of "development." On one
hand, development has resulted in serious inequities between
states, whereby large numbers of the world's inhabitants are mired in poverty, especially in Africa, while inhabitants of the
world's richest countries live in both relative and absolute luxury. And yet, due to development trends, populations in poor
countries are becoming wealthier over time—a process linked to globalization because countries in the developing world
can raise their standards of living by integrating with highly developed states.

The term "development" in international parlance therefore encompasses the need and the means by which to provide
better lives for people in poor countries. It includes not only economic growth, although that is crucial, but also human
development—providing for health, nutrition, education, and a clean environment.

The following Issue Brief is designed to help you:

 understand why some countries are developed and other are not;
 describe the problems development is designed to solve;
 familiarize yourself with the institutions that are active in development;
 explain the main strategies for fostering development; and,
 report on the facts and figures of the Millennium Development Goals, the international community's new effort to
promote development.

The Divide Between Developed and Developing Countries

One of the reasons that the process of development garners so much attention is the stark divide between rich
(developed) and poor (developing) countries. The United Nations Development Program (UNDP) rates countries'
development annually according to its Human Development Index (HDI), which includes measurements of citizens'
access to healthcare, educational attainment, and standards of living, among other factors.

During 2012, the five countries with the highest HDI rankings were Norway, Australia, United States, Netherlands and
Germany, while the five countries with the lowest rankings were Niger, Democratic Republic of Congo, Mozambique,
Chad and Burkina Faso, all African countries. In fact, 37 of the 46 states ranked as having low human development are

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located in Africa. In contrast, 32 of the 47 states considered to be very high human development are found in Europe
(Human Development Report 2013). As these figures demonstrate, development is often a highly localized issue, leading
to great wealth disparities between distinct global regions.

Why Are Some Nations Richer than Others?

Recent debates about globalization have led to a renewed interest in the reasons for inequality in development and, thus,
wealth distribution among the world's nations. Many of these discussions are approached from a historical perspective,
and seek to find the sources of disparities in development. Below are some of the major theories that work to explain
uneven development in different global regions.

Geography
In Guns, Germs, and Steel: the Fate of Human Societies, physiologist Jared
Diamond contends that geography has played a pivotal role in development.
Diamond notes that because the Eurasian landmass is oriented east-west, much
of its area lies in the same climatic region. This enabled inhabitants to trade
goods, ideas and land cultivation techniques like the use of cereal cultivation,
which across most of the Eurasian landmass in a historically short 2,500 years
(Diamond, 2005).

By contrast, the same techniques, which had spread into northern Africa, could
neither be used successfully in—nor cross—Africa’s hot tropical zone. This
meant that areas in Africa were essentially cut off from this early form of
development.

According to Diamond, eventually the lead that Eurasian societies had in

development gave them further tools to dominate peoples of other regions. In his
theory, agricultural success created food surpluses that led to the establishment
of soldier classes and advanced weapons.

Furthermore, Diamond hypothesizes that many centuries of working with animals caused Eurasians to catch and become
partially immune to diseases like smallpox, flu, tuberculosis, malaria, plague, measles, and cholera, all of which were
originally animal sicknesses. With these "guns, germs, and steel," Eurasian peoples were more readily equipped to
conquer other societies. For example, a tiny group of 168 Spanish conquistadors led by Francisco Pizarro (along with
local allies) defeated an army of 80,000 Inca soldiers and went on to
conquer the entire Inca Empire in what is now South America (Diamond,
2005).

Another example of geographically induced development is the growth of

river valley civilizations that existed before the Common Era. These
societies developed near the Nile River in Egypt, the Tigris and Euphrates
Rivers in Mesopotamia, the Yellow and Yangtze Rivers in modern-day
China, and the Indus River in South Asia. They became successful
because of their proximity to necessities (water), their ability to grow foods
due to their access to water, and more temperate climates in these regions.
As people gathered around these major water sources, they began diversifying their social structures. Later, the nations
built near these areas would become major hubs for trade, thus leading to greater wealth (Diamond, 2005).

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The ebb and flow of natural resources in a geographic area can greatly affect how societies develop. For example, while
natural resources can benefit a country, in some cases, the absences of resources can also further development. This
was the case in Great Britain prior to the Industrial Revolution, during which time the absence of wood and timber led to
necessary advancements in steel and steam.

Culture
In The Wealth and Poverty of Nations: Why Some Are So Rich and Some So Poor, economic historian David S. Landes
maintains that the reasons for different development rates are primarily cultural. While Landes admits that tropical regions
like sub-Saharan Africa were bound to develop more slowly than temperate areas because climate conditions prevent
productivity during summer months, he still puts much of the responsibility for instigating development on cultural factors.

Landes claims that in the year 1000, no one would have predicted that Europe would dominate the world 500 years later.
But starting in the 1500s, the Protestant form of Christianity promoted both literacy and concern for conservation of time,
and both of these attributes led to higher productivity in societies such as Britain, Germany, the Netherlands, and, later,
the United States. Likewise, in China and Japan, Buddhist beliefs emphasized labor and thrift, which led to faster social
and economic development (Landes, 1999).

Property Rights
Other commentators focus on particular aspects of culture as the engine of success. Hernando de Soto argues that the
secret to development lies in the structure of private property rights. In The Mystery of Capital, he says that the world's
"poor" actually possess great wealth. The problem, he writes, is that this wealth is usually tied up in "dead capital" due to
the legal and social customs in many developing countries (De Soto, 2003).

For example, many people in Egypt, as in America, own their homes and attached properties. But there is a difference
between the American and Egyptian conceptions of property. While Americans can utilize their homes to raise capital for
an economic activity like starting a business, Egyptians often cannot.

In America, ownership is well documented and there is an efficient legal system that can enforce contracts. Therefore, a
homeowner can take out a loan with a bank using his or her property as collateral. In Egypt, traditional land ownership
rules make it impossible for a landowner to prove to the bank that he owns his home. In addition, because the Egyptian
legal system is not strong in forcing debtors to repay loans, Egyptian banks may not wish to lend money as readily as their
American counterparts.

De Soto believes that by reforming land tenure and land ownership registration systems, developing countries can enable
their citizens to convert the dead capital that they hold in various land and other properties into huge sums of money that
can be used to expand development efforts. De Soto's research estimates the value of real estate now trapped in dead
capital to be $74 billion in Peru and $133 billion in the Philippines. In Egypt, $240 billion is tied up as dead capital, 30
times the value of all shares on the Cairo Stock Exchange and 55 times the value of all foreign investments in the country.
De Soto argues that if these funds were available for economic activities, the speed of development could be greatly
increased (De Soto, 2003).

Lack of Freedom
Bernard Lewis, argues in his book, What Went Wrong? The Clash Between Islam and Modernity in the Middle East, that a
lack of freedom—intellectual, political, economic, religious, cultural—is responsible for the decline of the Arab world from a
major center of global power to an area frequently dominated by outsiders and plagued by social and economic troubles.
Furthermore, he says, Middle Eastern governments are often too focused on finding scapegoats—especially Jews,

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Americans, and imperialists—for their failure to develop, asking "Who did this to us?" rather than, "What did we do
wrong?" (Lewis, 2003).

The UNDP's Arab Human Development Report, issued in 2004, endorses this view, noting that the Arab world had the
lowest indicators of seven world regions on a "freedom" index based on political participation of the population, civil
liberties, and unrestricted media. In addition, the report noted that women in the Arab world were not empowered, with
fewer political, social, and economic opportunities than Arab men, and fewer than women in other regions (Arab Human
Development Report 2004).

The 2005 Arab Human Development Report displayed findings of women’s rising roles in the Arab world. While they do
not enjoy full equality to men in terms of political, civil, and cultural rights, women’s status in the Arab world is improving.
The Report emphasizes equality between the sexes to be a main staple of human development (Arab Human
Development Report 2005).

A chart mapping the changes in human development levels across 21 Arab states between 1980 and 2011 shows general
improvements over time in nearly all cases (UNDP). However, those nations that continue to maintain especially low HDI
ratings, including Sudan and Yemen, are also understood as having minimal freedom in areas such as press censorship
and protections for minorities (Arab Human Development Report 2004). This correlation supports Lewis’ hypothesized
link between freedom and rate of development.

It should be noted that regions with restricted freedoms are

also found outside of the Arab world, and any
generalization to the contrary is as problematic as it is
untrue. In fact, constraints on freedoms exist in Africa;
Eastern Europe; Central, South, and East Asia; Latin
America; and even areas of the West.

Problems of Development Today

Today, the problems facing developing countries revolve
around what are generally called “structural constraints” to
development. First among these is geography—not just in
the historical sense described above—but also in the more
contemporary aspect that a modern economy cannot function without a division and diversification of labor. Thus,
countries with small populations may have trouble developing and gaining access to markets, while landlocked countries
may struggle to integrate with global markets and expand their economies.

Other common constraints on development are poverty, hunger, high mortality rates, unsafe water supplies, poor
education systems, corrupt governments, war, and poor sanitation. These factors all combine to create what the World
Bank calls "poverty traps"—cycles that must be broken for countries to develop.

Countries can avoid poverty traps, however, with strong policies. Likewise, geographic advantages do not always result in
sound development in cases when governments squander valuable natural resources. The World Bank, therefore,
recommends that countries focus on six areas of policy to improve chances of development:

 Investment in education and health

 Increasing productivity of small farms
 Improving infrastructure (for example, roads)
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  Developing an industrial policy to promote manufacturing
 Promoting democracy and human rights
 Ensuring environmental protection

The following sections of this Issue Brief describe how the international community tries to help poor countries implement
these policies.

Assistance for Development

Over the last 50 years, wealthy countries have assumed the responsibility of offering economic aid and other assistance
to economically disadvantaged countries. Development assistance resulted directly from the violence of the first half of the
20th century. As explained in the Issue Brief on the International Financial Institutions, the World Bank was created at the
Bretton Woods Conference to assist the countries shattered by the Second World War. The European Recovery Program,
commonly known as the Marshall Plan (named after one of its key architects, then U.S. Secretary of State George C.
Marshall), was the world's first development program.

Through the Marshall Plan, the United States provided billions of dollars to wartime allies like Great Britain, France, and
the Netherlands to help them recover from the war. But it also stood military and political tradition on its head: Instead of
taking money and resources from its defeated enemies as reparations for damage in allied countries, under the Marshall
Plan the United States poured billions of dollars into the economies of Germany, Italy, Austria, and other World War 2
adversaries as a way to prevent war in the future ([Link]).

The Marshall Plan thus established for the first time two key principles of development assistance:
1. That it is morally correct to help people struggling to improve their lives; and
2. That giving development funds benefits those states donating money by contributing to their foreign policy goals
and creating foreign markets for their exports.

By emphasizing these two principles, government officials were able to convince the public to support development
assistance programs and to ensure that Congress would approve budgets for this important work. Ultimately, the Marshall
Plan proved to be a moderate success. It was hailed by leaders of the nations that benefited from it, particularly Germany,
France, and Britain, as the key to a speedy economic and social recovery from the war and the foundation of a new era of
peace and prosperity in Europe.

By critics, however, the Marshall Plan is not understood as beneficial to development. Instead, they believe the Plan
symbolizes American imperialism and willingness to throw money at a problem. Some critics charge that the Plan’s
primary goal was to stem the spread of communism in vulnerable disaster zones, rather than to provide altruistic support.
These people often cite saving and business strategies as more important long-term economic factors than the influx of
foreign cash (Coffrey, 2012).

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Additionally, the decades following the War saw a massive decolonization of previously colonized areas of Africa, Asia
and Latin America, a trend which had profound effects on global development. This pattern of decolonization was due to
several factors, including agitation —politically and militarily— among colonized peoples for their independence from
European imperial powers. It was also the result of new conversations about the benefits of democracy that emerged
through the war’s efforts against fascism and communism, which made imperialism seem hypocritical, if not completely
amoral. As a result, much of the non-Western world, including India, Pakistan, Indonesia, and many African nations
began to emerge as independent nations (Strang, 1991).

As decolonization gathered momentum in the 1950s and 1960s, it became clear that many newly independent nations did
not have the skills and resources needed to thrive in their new era of freedom. Money, together with expertise and
infrastructure, was needed to make the most of new opportunities and develop economies for the improvement of the
lives of local people.

In response to these needs, wealthy countries began to establish agencies to contribute development advice and
resources to the developing world, as described in the following section.

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Institutions of Development
Development assistance is distributed through several means, including development banks, government and
international agencies, and non-governmental organizations.

Development Banks

As described in the Issue in Depth on the World Bank, established in 1945, the bank aims to foster development by
providing low-interest loans, interest-free credit, and grants. During FY 2012, the World Bank financed more than 35
billion dollars in development programs worldwide, through its sub-agencies, the International Development Association
(IDA) and the International Bank for Reconstruction and Development (IBRD). While aid was distributed relatively evenly
between the selected regions, Africa still received the largest amount of funds, about $7.5 billion (World Bank Annual
Report, 2012).

IDRB and IDA Development Programs by Region, 2012

(in millions of dollars)

Source: World Bank Annual Report, 2012

In addition to the World Bank, there are also a number of major regional development banks similarly dedicated to
providing low-interest financing for development projects. These banks have considerable expertise in understanding and
reacting to the special needs and conditions of the regions which they operate. Prominent examples of regional
development banks are the Inter-American Development Bank (IADB), the Asian Development Bank, and the African
Development Bank.

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In 2012, the IADB approved $10.8 billion in loans (IADB Annual Report, 2012). Similarly, the Asian Development Bank
offered more than $21 billion in assistance during 2012, financing $13.3 billion of that total on its own and co-financing the
rest with outside institutions (ABD Annual Report, 2012). Meanwhile, the African Development Bank provided UA 4.25
billion in development assistance during 2012. The majority of these loans and grants funded energy-related projects, but
funds were also put towards transportation, agriculture and other sectors (AfDB Annual Report, 2012).

United Nations Development Program

The United Nations Development Program (UNDP) is an agency within the United Nations that directs development policy
in member nations. It concentrates specifically on increasing development by focusing on the following issues:

1. Democratic governance, that is, helping countries create legislatures, courts, and bureaucracies;
2. Poverty reduction, such as debt relief and promotion of foreign investment,
3. Crisis prevention and recovery, such as dealing with post-war reconstruction and recovery from natural disasters;
4. Energy and environment, that is, providing efficient energy sources for the poor and improving their environment,
such as ensuring clear water sources;
5. Information and communications technology, such as helping poor countries develop phone systems; and
6. Preventing the spread of HIV/AIDS (UNDP).

Examples of its work include a program to install a civilian police force in Somalia, and an imitative to curb the spread of
sexually transmitted diseases, including HIV and AIDS in Africa, through the distribution of birth control technologies ,
among many others ([Link], 2013).

Government Aid Agencies

Wealthy countries disburse development assistance through development departments or agencies that are part of their
national governments. These agencies build infrastructure in developing countries, provide famine relief, advise
developing countries on public policy, and make grants to regional development banks.

Some of the world's largest government aid agencies are the Japan International Cooperation Agency (JICA), the U.S.
Agency for International Development (USAID), Britain's Department for International Development (DFID) and the
German Gesellschaft fur Technische Zusammenarbeit (GTZ). Examples of their work include USAID immunization
programs, which treat more than three million people worldwide each year, and recent efforts by the DFID to move
Haitians from tents into permanent homes before the arrival of the 2013 hurricane season ([Link]; Safe Homes for
Haiti as Deadly Hurricane Season Approaches, 2013).

The U.S. Peace Corps is also a government agency, but operates more like a non-governmental organization (NGO),
which you will read about below. The Peace Corps sends people to work directly with local populations for extended
periods of time, especially in remote locations, to focus on major issues within that area. Peace Corp volunteers work in
many different fields, such as teaching high school science and math, instructing farmers on advanced agricultural
techniques, and building water and sewage systems.

Non-Governmental Organizations
Non-governmental organizations (NGO) are bodies organized by private citizens to give financial and technical assistance
to developing countries. NGOs are, by definition, independent of any government and of the various development banks.
They generally focus on "grassroots" development that involves local groups and individuals and often come into conflict
both with the governments of the countries in which they operate and the official development world.

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At the same time, much of NGOs’ funding comes from governments and international organizations, such as the UN, so
they function in a complex environment, sometimes cooperating with and other times in opposition to other development
institutions. Occasionally, for example, they compel official institutions to make changes by rallying the public in both
wealthy and poor countries against policies they consider harmful. In other cases, they may work alongside government
institutions to implement reforms and development programs.

Some of the prominent NGOs are Oxfam International, CARE, and World Vision. Examples of their work include running a
media campaign for HIV/AIDS awareness in Ukraine, providing relief and reconstruction after a hurricane hit Honduras,
and delivering meals in urban schools in Zimbabwe.

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Case Studies of Development Projects

The organizations described above engage in a wide range of activities. Here are three detailed descriptions of typical
development projects.

Community Management of Acute Malnutrition Programme, UNICEF

UNICEF is an agency within the UN devoted entirely to protecting the rights and wellbeing of children worldwide. The
work of UNICEF aids global development because the organization maintains the stance that “nurturing and caring for
children are the cornerstones of human progress.” UNICEF’s projects focus on the following five major areas: Child
Survival and Development; Basic Education and Gender Equality; HIV/AIDS and Children; Child Protection; and Policy
Advocacy and Partnerships ([Link]).

In 2009, UNICEF, in collaboration with the Nigerian Government, launched a program to lower malnutrition rates among
children in Northern Nigeria. The program works locally, by bestowing community doctors and health centers with
necessary tools to treat malnutrition, as opposed to having children travel to large hospitals far from their homes. The
tools are relatively simple – a fortified peanut paste and vitamins administered in prescribed dosages – but the program
has been incredibly successful, treating more than 500,000 children as of July 2013 (Sorenson, 2013).

The program’s effects on development are, thus, twofold. Primarily, it works to improve the chances of an entire
generation of Nigerian citizens, who may otherwise be, at best, developmentally stunted due to malnutrition, and at worst,
unable to survive. Secondly, the initiative supports Nigerian infrastructure by equipping local medical centers with
necessary resources and skills to meet the needs of the people they service.

Financial Infrastructure Development Project, World Bank

The World Bank undertakes many different development initiatives worldwide. As mentioned above, these often include
giving grants and loans to governments, small businesses and/or organizations to fund different projects aiding the
progress of developing nations. The Financial Infrastructure Development Project follows these guidelines. The Project is
a joint agreement between the World Bank and the state of Yemen; it provides the Yemeni government with a $20 million
grant to improve its central banking system. Yemen is understood to be the poorest country in the Middle East and North
Africa Region, a situation exacerbated by the 2011 political crises that resulted in massive, violent protests throughout the
nation and the eventual overthrow of the existing government. The nation has suffered financially, especially since that
time (The World Bank, 2013).

The Financial Infrastructure Development Project is meant to stabilize and make more transparent Yemen’s central
banking system. Functional and trustworthy central banks are crucial to development of strong financial infrastructure.
This financial infrastructure can allow people to access credit, which can be used to build small businesses, buy homes,
attend college and other key components of a highly developed society. In this sense, the Project extends beyond
creating a more functional banking system, in that it implicitly supports other forms of development.

Powering Haiti with Clean Energy, The Clinton Foundation

The Clinton Foundation is an example of a globally active non-government organization (NGO) that supports projects to
improve development in impoverished regions and countries. The organization was founded by the Clinton family and
works within several different focus areas, including global health, economic inequality, climate change and others. The
Foundation became involved in projects in Haiti in 2009, when the nation was already considered one of the poorest in the

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Western Hemisphere. Following the devastating earthquake there during 2010, the need for aid in Haiti was heightened
more so.

The Powering Haiti with Clean Energy project, founded in 2012 and renewed in January 2013, aims to improve Haitian
infrastructure while finding sustainable energy solutions for the country, much of which lacks access to electricity. To this
end, the project has worked to replace high dependency of expensive fossil fuels with solar energy in communities across
the country. Results of this effort include newly constructed schools with electricity and solar powered street lamps, which
vastly improve the safety of nighttime travel when compared to dark roads ([Link]). The Clinton
Foundation’s effort to bring solar power to Haiti may greatly affect development in the nation. As schools are provided
electricity, the education system can be updated and made more accessible to students. And as noted above, the
installation of reliable streetlamps will improve public safety, especially for women and children who are often understood
to be most vulnerable to assaults.

Here is another example of a development project:

VIDEO: “Fair Trade Coffee in Uganda.” GreenTV. [Link]

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Development Strategies
The institutions and projects outlined above operate according to certain strategies for development that sometimes
conflict and other times reinforce each other. The following section describes some leading theories on how to provide
development assistance. No single theory can explain how development works best or offer a strategy that is most
efficient in every case. Furthermore, the theories are founded on the different hypotheses about the causes of national
poverty that were discussed in the beginning of this Issue Brief, meaning that they vary in the specific issues they seek to
address.

Poverty Reduction
Poverty reduction is the main goal of the World Bank, the UNDP,
and most other development agencies. This strategy emphasizes
lifting countries out of what the World Bank calls "poverty traps",
such as low productivity, poor infrastructure, and weak public health
and education systems. According to the Bank, poverty reduction
policies should focus on six areas:

1. Social structures, such as health, nutrition, education,

water, and sanitation systems;
2. Agricultural production, including improving technology,
rural infrastructure (such as roads, irrigation, and storage
facilities), and secure property rights;
3. Infrastructure, such as roads, ports, energy, and
communications;
4. Government industrial policies that spur private economic
activity, such as tax incentives and government-funded
research and development;
5. Social equality, such as equal rights for women (discussed
in more detail); and
6. Environmental sustainability (also discussed in more
detail). Investments in these areas, says the Bank, would
lead to an economic take-off "within a generation"(The
World Bank, 2001).

Significantly, the World Bank says that outside resources are not needed to get the ball rolling on poverty reduction, only
to support it once it’s begun.

Most importantly, the World Bank states that economic policies should be oriented toward the creation of jobs in labor-
intensive manufacturing industries, to produce goods for export, which, it believes, "is half the battle of achieving
sustained growth"(United Nations Development Program [UNDP], 2003).

But those policies, the World Bank argues, require a support system of properly valued exchange rates, financing from
foreign direct investments, and a competent and cooperative public sector bureaucracy. The institution notes that while
industrial development moves forward, poor populations still need other help, such as agricultural assistance, access to
land, and other economic assets and legal rights (UNDP, 2003).

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Trade-Not-Aid

The trade-not-aid strategy is based on the

idea that if developing countries were able to
trade more freely with wealthy countries, they
would have more reliable incomes and they
would be much less dependent on external
aid to carry out development projects.
International trade would raise incomes and
living standards as poor countries would be
able to export their way to economic
development by selling their products to rich
countries eager to buy their goods. In this
sense, the “trade-not-aid” theory aligns with
the poverty reduction theory, in that both
perspectives emphasize the importance of
creating export sectors to increase
development.

Unfortunately, most wealthy countries have

higher tariffs on goods that developing
countries export, such as clothes, than on
manufactured goods that other developed
countries produce. This means that in order
to sell their goods in developed countries,
exporters in developing countries must pay
high taxes, which are ultimately reflected in
higher prices of their products once they hit
the market. Developed countries also
subsidize their own industries to keep prices
of domestically produced goods low, thereby
keeping out competition from poorer
countries.

For example, Middle Eastern countries face average clothing tariffs of 15 percent on the $4.2 billion worth of goods they
export to the United States each year (Reuters, 2009; Office of the United States Trade Representative, 2009).
Meanwhile, France encounters tariffs of only two percent on manufactured goods, which account for $34 billion in annual
exports to the United States (Reuters, 2009; Central Intelligence Agency). According to Progressive Public Policy
Institute, although Middle Eastern countries export less merchandise to the United States than France, they pay just as
much in taxes. This is because the United States charges higher taxes on clothes than on manufactured goods, creating
a disadvantage for developing countries, where apparel is often a primary export industry (Reuters, 2009).

Likewise, subsidies to European farmers have played a role in the decline of the Brazilian and Jamaican dairy industries
and the South African sugar industry. Wealthy countries grant subsidies of $265 billion per year to their domestic farming
industries, 3.3 times more than the aid given to developing countries by OECD member states (Organization for Economic
Cooperation and Development, 2005; Office of the U.S. Trade Representative, 2006). In fact, every cow in Europe gets
more money in EU subsidies per day (an average of $2.20) than 20 percent of the world’s population earns in daily
income (Kaplan & Calzonetti, 2005). Eliminating those subsidies, many analysts say, would make development aid much
less necessary and allow poor countries to develop their own economies while competing in the global economy.

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The Uruguay Round trade negotiations, completed in 1994, established the World Trade Organization and were intended
to open developed countries' agriculture and textile markets to trade with the developing world. Poor countries were
disappointed, therefore, when the negotiations did not result in as much access to global markets as they had hoped for.
They agreed to another round of negotiations at Doha, Qatar, in November 2001 only if their needs were specifically
addressed. The round was therefore dubbed the "Doha Development Round" and was intended to focus on the needs of
developing countries for access to the import markets of developed countries. Particularly important was the end of
agricultural subsidies, which were supposed to be gradually lowered and eventually eliminated.

But in the ten plus years since the Doha meeting, negotiations on agricultural trade have progressed slowly. In the
summer of 2003 the United States and Europe finally promised a reduction in subsidies, but it was not enough for the
developing countries. The whole round of negotiations stalled in September 2003 when the developing countries refused
to go forward with discussions on other areas of trade, such as rules for foreign investment. Since then, little has changed
and few negotiations have been determined from Doha.

In 2006, because of continued disagreement and stalled negotiations, the General Council for the Doha Rounds agreed to
suspend the talks, and the meeting in 2008 signaled the conclusion of the Doha Round (World Trade Organization). The
general consensus remains that the Doha Rounds ultimately did very little to significantly implement the Trade-For-Aid
strategy or decrease agricultural subsidies in OECD countries.

Good Governance
VIDEO: “Good Governance in the Fight Against HIV/AIDS in Tanzania.” World Bank, 29 November 2007,
[Link]

The “good governance” development strategy focuses on ensuring that development aid is spent most effectively by
receiving states. In an influential research paper published by the World Bank in 1997 entitled “Aid, Policies, and Growth,"
two economists showed that development aid was most helpful when given to countries that had sound fiscal, monetary,
and trade policies. Aid given to poorly run countries, on the other hand, had no effect on economic growth (Burnside &
Dollar, 1997).

This research spurred the idea that aid should be given selectively, only to countries that implement good economic and
other policies. The idea has had a major impact on aid programs. In January 2004, for example, the U.S. government
announced the establishment of a new fund for international development, called the Millennium Challenge Corporation.
The corporation began by distributing up to $5 billion per year to countries that the U.S. government judges to be fighting
corruption, improving social services, and adhering to the rule of law and human rights (Pan, 2004). By FY 2011, the
yearly appropriations had risen to $10.4 billion (MCC Annual Report 2011).

Another element of this strategy to support good governance is the idea of "institution building." The growth of many
developing countries is constrained, the theory suggests, by the capacity limitations of their government agencies. To
combat this problem, projects to strengthen institutions are directed at developing countries' government agencies to
improve their technical abilities and increase their operational efficiencies in areas such as the legislatures, courts,
government bureaucracy, law enforcement, and regulatory agencies.

For example, USAID has helped legislators in El Salvador, Bolivia, Nicaragua, Guatemala, and Mozambique modernize
their lawmaking processes through assistance in drafting budgets, defining legislative goals, and interacting with citizens.

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Sustainable Development
Sustainable development means, in the words of the 1987 World Commission on Environment, "development that meets
the needs of the present without compromising the ability of future generations to meet their own needs." In other words,
sustainable development is a comprehensive approach to promoting development in ways that do not harm the
environment or deplete natural resources so that they still will be available in the future.

This strategy is guided by the international agreement called Agenda 21, or the Rio Declaration on Environment and
Development, which focuses on the goals of sustainable development. These goals include economic prosperity in
combination with and alongside protection of the world's atmosphere, promotion of sustainable farm production,
combating deforestation and desertification, protection of the oceans, maintenance of biodiversity, and protection of water
resources (United Nations, n.d.).

As a strategy, sustainable development recognizes that past policies sometimes achieved development by means that
could not be kept up over time. For example, in the 1990s, between 10,000 and 30,000 square kilometers a year of
Brazilian rainforest was cleared, fueling rapid economic growth in farming and ranching operations (Butler 2012). In the
short term, the practice created jobs and increased food production, but environmental damage caused by the clearing
made much of the newly cleared land unusable in the longer term; the net result in many cases was a negative economic
outcome.

On the other hand, a sustainable development project is, for example, a program funded by the Canadian International
Development agency that worked for almost three years to help farmers in drought-prone regions of Zimbabwe and other
Sub-Sahara African countries develop better farming techniques. Through this program, farmers learned how to use new
technologies of irrigation and soil conservation, and obtained drought-resistant types of seeds of indigenous species of
plants. The program also helped the local government officials work more closely and efficiently with the citizens to foster
these policies, leading to improvement in what is known as "sustainable livelihoods" for the farmers (Canadian
International Development Agency, 2006).

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Gender Equality

Statistics show a strong link between the lack of women's

rights and poverty. In societies without gender equality,
women are denied access to education, legal
representation, and political voice, making it much harder
for them to contribute to social progress. For example,
where women are prevented from holding jobs or pursuing
careers, half of the population is unproductive, and this is a
major inhibitor of a country's development and economic
efficiency (Khan, n.d.).

Furthermore, lack of concern for women can lead to major

social problems. For example, illiterate and poorly educated
mothers have a hard time providing high quality child care
because they lack knowledge about proper health care and
nutrition. As a result, their children have higher mortality
and malnutrition rates. This, too, leads to slow economic
growth.

Many development programs therefore focus on gender

specifically, with the goal of fostering general social
cohesion and economic progress by attending to women's
issues. For example, "microbanks" have been created to
lend small amounts of money—sometime only a few
dollars—to women to help them start businesses based on
their skills, such as sewing.

The Hunger Project runs a microfinance program meant to

empower women in Africa through small loans. These
loans can be used for a number of different practical needs,
including building small businesses, paying for their
children’s schooling, construction projects, and so on, and
thereby allowing women to engage in other income building
activities ([Link]).

New Investment Strategies

In the late 20th century and early 21st century, there has been a growing movement called microfinancing. This movement
became popular thanks to Bangladeshi banker and economist Muhammad Yunus, who was jointly awarded the Nobel
Peace Prize in 2006 with Grameen Bank. Similarly to the Hunger Project example given above, microfinancing
emphasizes microcredit, or the creation of small loans given typically to poor entrepreneurs in developing nations who are
too impoverished to apply for more traditional bank loans. Supporters of the microfinance movement argue that
microfinance is cyclical in nature; by giving loans to poor individuals, these people can create businesses and sustain their
households by raising income and building assets (Consultant Group to Assist the Poor, 2012).

Critics of the movement emphasize the potential for usury – the difficulty in tracking how money lent is spent – and the
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sustainability of operations. In addition, some microfinance institutions charge obscenely high interest rates which could
stunt, rather than contribute to poor individuals' economic growth. This leads critics to believe that microcredit is a short-
term solution to a long-term problem. Nevertheless, this growing trend is making headlines and serves as a nontraditional
way for individuals to participate in international investment (Dichter, 2006).

Conclusion: The Millennium Development Goals

VIDEO: “UNICEF: UN Urges New Commitment to Millennium Goals.” UNICEF, 6 July 2009.
[Link]

VIDEO: “GOOD: The UN Millennium Declaration.” GOOD Magazine, 12 June 2007.

[Link]

All of the organizations and strategies described above have come together in the push to achieve the Millennium
Development Goals (MDGs). In September 2000, the leaders of 189 countries met at United Nations headquarters in New
York to participate in the UN Millennium Summit. At the conclusion of the meeting, members agreed to the UN Millennium
Declaration, which laid out the MDGs as guides for the UN in the years to come, as shown in the box below. They are
intended to be part of a "compact" between poor nations and rich nations, ensuring that rich will devote resources to
helping poor countries develop if the poor make their own efforts to reform their countries to make the assistance work
effectively and efficiently.

Millennium Development Goals

1. Eradicate extreme poverty and hunger

2. Achieve universal primary education
3. Promote gender equality and empower women
4. Reduce child mortality
5. Improve maternal health
6. Combat HIV/AIDS, malaria, and other diseases
7. Ensure environmental sustainability
8. Develop a global partnership for development

Source: United Nations

Along with the goals, the international community set 18 specific targets to meet to fulfill the goal and related indicators by
which to measure achievement toward meeting the targets and goals. For example, one target is to halve the number of
people in the world living in hunger, as measured by, among other factors, the proportion of children under five years of
age who are underweight.

Another target is to integrate sustainable development principles into developing countries' policies, as measured by,
among other factors, the amount of forestland and the amount of land preserved for biological diversity purposes. A third
target is making information technologies available to wider sector of the world's population, as measured by the
percentage of people with access to personal computers, the Internet, and telephones.

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The targets, as measured by a set of indicators, will be a crucial yardstick by which world leaders will be able to judge to
what extent their development efforts are working. They also will help organizations like the World Bank and UNDP
produce a more concrete vision of what they want to accomplish over the years to come, and hopefully enhance their
ability to convince governments to give them the funds needed to accomplish the goals.

Can the world actually achieve the Millennium Development Goals by the year 2015? According to the UN, $110 billion in
additional development assistance per year will be needed in 2015, about 2.7 what had been given in 2002(United
Nations Millennium Project, n.d.). .According to the UN Development Program, the only region that has made reasonably
positive progress toward the goals has been Eastern and Southeastern Asia, which has 1.5 times less of extreme poverty
(UNDP, 2010) and dramatically reduced hunger rates since 1990. Other regions, though, such as Latin America, have
shown little progress, and some even regressed. Poverty has worsened steadily in sub Saharan Africa and in Western
Asia, for example (UNDP, 2009).

In 2009, two years past the halfway point to the 2015 goal, progress in the eradication of poverty and hunger had “slowed
or reversed” as a result of the global economic and food crises. The 2009 progress report concludes that most goals will
not be met by 2015 (UNDP 2009). As of 2013, just two years away from the 2015 expiration date, certain goals have
been accomplished and others are close to fruition.

For example, the percentage of people living on less than $1.25/day has been halved globally, more than 2 billion people
have gained access to clean water, the number of people affected by malaria and tuberculosis has been minimized and
the hunger reduction target is attainable within the prescribed deadline. However, other objectives are still far from
completion. These include environmental sustainability, lowering child and maternal mortality rates, increasing access to
education, HIV prevention and treatment and others (The Millennium Development Goals Report 2013). It remains to be
seen whether these areas in need of further progress will receive adequate attention in coming years, and if new, loftier
objectives will be set in spheres of development where previous goals have already been met.

Stories of Jeremiah Ugwu, Ifeanyi Okpaga, Cynthia Ukwegwu, and Simon “Monday” Aliome

Jeremiah Ugwu, Ifeanyi Okpaga, Cynthia Ukwegwu, and Simon “Monday” Aliome are all students at the Hope High
International School in the Eyboni State of Nigeria. The wife of State Governor Dr. Sam Egwu, Unis Ukamaka Egwu, built
the high school and scouted the state to find the best and brightest pupils to attend the school. The high school has a
program, fully paid by the state, to send the incoming students to the United States to study at a special summer program
at St. Timothy’s School in Baltimore, Maryland. There, [Link] had the opportunity to interview four
incredible students. All four students expressed their gratitude to Dr. Sam Egwu and his wife for the opportunity to attend
this school during the summer, and to study international politics and the US democracy.

Jeremiah Ugwu

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 Jeremiah was born in the village of Obodo Aba Obeage in
Eyboni state. He is the youngest of five children, with an
older brother and three older sisters. His parent work on
agriculture policy for the local government. After visiting
the United States, he decided he wants to become a
Nigerian diplomat and work for the Nigerian Embassy in
the United States. When asked how globalization affects
his life, he said globalization has helped bring better
transportation to his village and has allowed him to fly to
the United States.

Ifeanyi Okpaga
Ifeanyi is fifteen. He was born in the town of Ezzangbo,
part of the village of Umuagara. He is the youngest of six
children, with three older brothers and two older sisters.
His parents are subsistence farmers, who grow yams,
maize, cassava and pumpkin. He believes education is
important and understands that not everyone has the
opportunity to go to school. He said many children are
forced to farm rather than go to school. When he grows
up, he wants to be an engineer, so he can construct
roads. He said “most of my family lives in primitive areas
where there are no bridges, no water and occasionally
there is electricity.” When asked how globalization affects
his life, he spoke about the importance of communication.
Today he can make telephone calls, whereas five years
ago he could not. He pays a local business 60 naira
(about 50 cents) for a two-minute phone call on a cell
phone.

Cynthia Ukwegwu
Cynthia was born in the village of Amudo. She is one of
six children in her family. Her family traveled a lot when
she was younger and so she has lived in a number of
Nigerian states. Her sister is also in school and her older
brother is in the first year of university. She wants to be an
accountant and to help the government with their banking
system. She dreams of working for the World Bank. When
asked how globalization affects her life, she said it has
given her the freedom to travel and to immigrate. She
hopes to move to the United States. She hopes that after
seeing the world, she can go back to Nigeria and use the
ideas she has learned to help improve her country’s
economy. Her trip to the United States has influenced her
to want to take a leadership role in her community by

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 becoming a chairperson.

Simon “Monday” Aliome

Simon was born in the village of Kpakpajiezzama. He is
one of seven children in his family. His parents are
subsistence farmers, who grow cassava, star fruits, cocoa
and yams. He attended primary school in his own village
before attending Hope High. He wants to be a mechanical
engineer because he wants to build houses and bridges.
When asked about how globalization has affected his life
he spoke about the spread of television and access to
cars and telephones. He has to walk 30 minutes to school
every day. Sometimes he catches a ride with a friend on a
motorcycle or a bus. One of his favorite games he learned
in the United States was “Simon Says’. He plans to teach
it to everyone when he returns home. He hopes it will
spread around Nigeria.

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