Challenges Facing Developing Countries
Challenges Facing Developing Countries
Janita Aalto
Principles of Microeconomics
ECO 204
Instructor Kathryn Armstrong
March 28, 2011
Challenges Facing Developing Countries
Developing countries, also known as third and fourth world countries; face economic challenges that first world countries do not face, on a large scale. Poverty, low literacy rates, poor investments in both human capital and domestic capital, poor nutrition and devastation to populations due to the HIVAIDS pandemic contribute to developing countries moving towards development. The primary focus of this paper is to explore the impact the HIV/AIDS pandemic has had on Sub-Sahara African economies and to explore the challenges facing developing countries to stimulate domestic savings.
The impact on the economies of some of the African countries is still not completely known. If we look at economic impacts, first we must look at the human cost HIV/AIDS is having on Africa’s economic development and ability to cope with the pandemic. According to an online journal, there are four variables that outline the effects on Africa’s future development: “Economic research helps to estimate the effects of HIV/AIDS on the African economy and the cost effectiveness of prevention and treatment programmes; Economic theory predicts that HIV/AIDS reduces labour supply and productivity, reduces exports, and increase imports; The pandemic has already reduced average national economic growth rates by 2-4% a year across Africa; Prevention and treatment programmes and economic measures such as targeted training in skills needed in key industries will limit the economic effects of HIV/AIDS”, (BMJ. 2002, p. 232). In examining the economic effects of HIV/AIDS, it is hard to look past the fact that over 17 million African people have lost their lives to HIV/AIDS and has 70% of all HIV/AIDS related cases in the world. These are staggering statistics. As outlined in the above journal article, the mortality rates have
Janita Aalto
Principles of Microeconomics
ECO 204
Instructor Kathryn Armstrong
March 28, 2011
Challenges Facing Developing Countries
Developing countries, also known as third and fourth world countries; face economic challenges that first world countries do not face, on a large scale. Poverty, low literacy rates, poor investments in both human capital and domestic capital, poor nutrition and devastation to populations due to the HIVAIDS pandemic contribute to developing countries moving towards development. The primary focus of this paper is to explore the impact the HIV/AIDS pandemic has had on Sub-Sahara African economies and to explore the challenges facing developing countries to stimulate domestic savings.
The impact on the economies of some of the African countries is still not completely known. If we look at economic impacts, first we must look at the human cost HIV/AIDS is having on Africa’s economic development and ability to cope with the pandemic. According to an online journal, there are four variables that outline the effects on Africa’s future development: “Economic research helps to estimate the effects of HIV/AIDS on the African economy and the cost effectiveness of prevention and treatment programmes; Economic theory predicts that HIV/AIDS reduces labour supply and productivity, reduces exports, and increase imports; The pandemic has already reduced average national economic growth rates by 2-4% a year across Africa; Prevention and treatment programmes and economic measures such as targeted training in skills needed in key industries will limit the economic effects of HIV/AIDS”, (BMJ. 2002, p. 232). In examining the economic effects of HIV/AIDS, it is hard to look past the fact that over 17 million African people have lost their lives to HIV/AIDS and has 70% of all HIV/AIDS related cases in the world. These are staggering statistics. As outlined in the above journal article, the mortality rates have
References: Case, K.E., Fair, R.C. and Oster, S.E. (2009) Principles of Microeconomics (9th ed.) Upper Saddle River, New Jersey: Pearson Prentice Hall. Dovi, E. (2008) Boosting domestic savings in Africa: From Africa Renewal, Vol.22#3 (October 2008), page 12, Retrieved on March, 26, 2011, from http://www.un.org/ecosocdev/geninfo/afrec/vol22no3/223-boosting-domestic-savings.html InvestorWords, Retrieved on March, 20, 2011, from http://www.investorwords.com Copyright©2011 by WebFinance, Inc BMJ, 2002 January 26; 324(7331):232-235 PMCID:PMC1122139 ; Retrieved on March 25, 2011, from http://www.ncbi.nlm.nih.gov/pmc/articles/PMC1122139