The World Bank Essay Research Paper Since — страница 2

  • Просмотров 392
  • Скачиваний 5
  • Размер файла 19
    Кб

are, according to George, the result of a capital intensive, energy-intensive, unsustainable Western model of development, which is only favorable to Third World elite s, Northern banks, and multinational corporations. Susan George believes that the World Bank has induced social and economic outcomes, which ultimately affect the Western world in adverse ways. These outcomes she describes as debt boomerangs, (6) and are described below. The first boomerang is debt-induced poverty. This causes Third World people to exploit natural resources in the most profitable and least sustainable way, causing an increase in global warming and a depletion of genetic bio-diversity, thus affecting all citizens of the world. Secondly, the illegal drug trade for heavily indebted countries, like

Peru, Bolivia, and Colombia, is their major export earner. Thus giving them little alternative, but to condone such activities. The social and economic costs of drug consumption in the US alone have cost $60 billion. Thirdly, Western governments have allowed their banks tax concessions so they may write off so-called bad debts from Third World countries. However this has not reduced the real debts of poor countries, and in the case of the UK has cost the government $8.5 billion. Fourthly, there have been lost exports to Western countries from the Third World due to the burden of high debt servicing costs. It has been estimated that this accounts for one fifth of total US unemployment. Fifthly, legal and illegal immigration from the Third World has resulted in100 million economic

refugees, resulting in enormously high economic costs to Western nations. Lastly, conflict that is often an effect of the strain put on debt burdened Third World countries, this may be seen as possibly an influence for Iraq s invasion of Kuwait. The World Bank is often seen as being party to disbursing funds to malicious and repressive regions that often use these loans to further entrench their power. An ardent critic of this aspect of the Banks operations is Patricia Adams. Adams argues that there are large amounts of debt owing to the Bank that are very odious in nature. (7) Odious debts may be defined as any debt that has been incurred by a government without the informed consent of its people, and one that is not used in the legitimate interest of the State. (8) Many of the

activities that Third World governments undertake are often not in the interest of the people that they represent, this can be seen by the treatment of the Penan people of Sarawak, whose forests are being traded away for the benefit of others. Much of the above debate has been structured around the effectiveness of the World Bank s structural adjustment programs, which were developed to force the borrowing countries into macroeconomics discipline. These policies have resulted in huge social and economic changes, which has caused much hardship to many of the countries citizens. For example, Oxfam, a British charity, released a study (9) recently on Latin America, which suggests that after a decade of structural adjustment, and despite economic growth, more people than ever are

living in poverty. These studies, however, are often very subjective, as there is no way to easily measure welfare of the poor, especially in countries where statistics are sparse. The World Bank has just issued a report (10) that suggests that Third World nations may find it very difficult to grow at a rate that will create enough wealth to lead to sustainable development if they rely on commodities as their major export. This, the Bank, suggests maybe so as many Third World countries export mainly commodities. Countries where manufactured exports accounted for at least 50% of total exports enjoyed average annual GDP growth of 6.8% between 1980 and 1992. While those that exported mainly non-oil commodities grew by only 1.4% – so slowly, that real income per head declined. The

countries that the World Bank categorizes as low-income commodity producers have an average annual income of $420 per head, and their commodity exports make up over 50% of their total exports. Average commodity prices have dropped by more than half in real terms since 1980, representing an annual loss to low-income commodity producers of $100 billion – almost twice they received in foreign aid. Another factor, which has contributed to their low growth, has been that world trade in commodities has grown far slower than trade in manufactured goods and services. African countries, in particular, have adopted policies that have stunted growth in non-commodity industries, such as agriculture. These policies are ones similar to import barriers on manufactured goods such as tractors,