How Can International Efforts Reduce Global Inequalities
How can international efforts reduce global inequalities?
Over time countries start to separate into those who are less-developed and poor and those that are well-developed and rich. The poorer countries often need help from the richer countries in order to survive. In recent years the gap between the richest and poorest countries has got wider and there are many ways in which the richer countries can work together to reduce these global inequalities.
Probably one of the most significant ways in richer countries and International financial organisations (like the World Bank) can help poorer countries is by providing them with loans. Loans consist of money given to a country for free at the time so that country can invest in its own development and then in turn pay the richer country back. An example is Brazil in the 1970s, where their aim was to build factories, manufacture goods and then export them making a profit, which they would then use to pay back the country they borrowed the money from. Brazil managed to do this successfully, but often it is not.
Although loans may seem like a good idea, but what if the country that borrowed the money cannot pay the money back in time? This is where interest rates start to occur which can use up all the money that would have been used for development. People have to work overtime and although this means that they are making more profit, none of it is going back into the country to develop it, all of the money is going to the banks to try and repay the loans. This basically means that it is impossible for the country to develop and progress until they repay the loans. An example of this case is Africa which owes more to bankers in interest on debt than it receives in aid each year from richer countries.
Richer countries and the World Bank may help with a solution to the problem of debt by reducing the amount that is needed to be paid back or reducing the interest rate which is called debt relief. In some cases
Over time countries start to separate into those who are less-developed and poor and those that are well-developed and rich. The poorer countries often need help from the richer countries in order to survive. In recent years the gap between the richest and poorest countries has got wider and there are many ways in which the richer countries can work together to reduce these global inequalities.
Probably one of the most significant ways in richer countries and International financial organisations (like the World Bank) can help poorer countries is by providing them with loans. Loans consist of money given to a country for free at the time so that country can invest in its own development and then in turn pay the richer country back. An example is Brazil in the 1970s, where their aim was to build factories, manufacture goods and then export them making a profit, which they would then use to pay back the country they borrowed the money from. Brazil managed to do this successfully, but often it is not.
Although loans may seem like a good idea, but what if the country that borrowed the money cannot pay the money back in time? This is where interest rates start to occur which can use up all the money that would have been used for development. People have to work overtime and although this means that they are making more profit, none of it is going back into the country to develop it, all of the money is going to the banks to try and repay the loans. This basically means that it is impossible for the country to develop and progress until they repay the loans. An example of this case is Africa which owes more to bankers in interest on debt than it receives in aid each year from richer countries.
Richer countries and the World Bank may help with a solution to the problem of debt by reducing the amount that is needed to be paid back or reducing the interest rate which is called debt relief. In some cases