AQA A Revision: Development

PART A: CONTRASTS IN DEVELOPMENT MEANS THAT THE WORLD CAN BE DIVIDED UP IN MANY WAYS

1. What does ‘Development’ mean?

The use of human and natural resources to achieve a higher standard of living.

2. How can development be measured?

There are number of indicators that can be used and can be normally classified into economic, social or

environmental factors.

3. What economic indicators are there?

Economic indicators relate to the income of a country. These are shown below:

GDP (Gross Domestic Product): the total value of the good and services produced by a country in a year

GNI (Gross National Income): like GDP, but also factors in income from overseas

But to enable comparisons between countries the GDP/ GNI countries, two things are/can be done:

GNI/GDP expressed ‘per capita’ (Latin for ‘head’) =

provides and average. Total income divided by the

number of people in the country.

GNI/GDP ‘PPP’ (Purchasing Power Parity) = the

GDP/GNI figure is adjusted to reflect the cost of living in

particular countries. For instance, a dollar will buy you

more things in some countries (normally LEDCs) than in

other (normally MEDCs). Essentially, the cost of living in

LEDCs tend to be less, so the GNI/GDP figure is adjusted

upwards to reflect this.

The UN attempted to divide up the World based on income

– see the map on the right.

4. What social indicators are there?

These include things like health, education, population. Things like life expectancy, adult literacy %, infant mortality

and access to health care. They tell you about the lives of the

people in the country.

5. What environmental indicators are there?

These can often be harder to quantify. They include indicators

such as access to clean water, air pollution and sanitation

systems.

6. Is there a link between GNI and social indicators?

It appears so. Look at the diagram on the right – why do you

think higher GNI/per capita leads to a lower birth rate?

7. Why is it useful to look for such correlation between two

indicators?

Using one indicator alone is not wise. GNI does not show the

distribution of wealth within a country – i.e. one person might own 99%

of the wealth and the rest of the population could be really poor. Such

inequality can’t be hidden in social indicators like life expectancy or

adult literacy. Therefore, it is best to examine a variety of indicators to

gain an accurate picture.

8. How can different parts of the World be classified?

Willi Brandt (ex-German Chancellor) devised this map in 1981.

The ‘Brandt Line’ shows the rich countries to the north and

the poor countries to the south.

However, this is now deemed to be a little out of date, as

many things have changed since 1981: collapse of the old

Soviet Union and the rapid industrialisation of places like

South Korea and Mexico (Newly Industrialised Countries or

‘NICs’) and the rise in wealth of places like the Oil exporting

countries in the Middle East – UAE etc. were not taken into

account.

If you look at the previous page, you

can see the map devised by the World

Bank and the UN showing how they

have classified the World based on four

levels of income. This is similar to the

Brandt Line map, but is more detailed

and reflects the more recent changes.

The UN also has introduced a measure

called HDI. I will discuss this in more

detail in the next section, but the map

created from this measure is shown on

the right.

9. What does the term ‘standard of living’ mean?

Standard of living refers to how much money people have – it is

measured as GDP per capita. MONEY!!!!

The map on the left shows the proportion of people living on less

than $1 dollar ppp a day. Larger than normal areas for a country

shows a high number of people living on $1 a day – i.e. they have a

very low ‘standard of living’.

10. What does the term ‘Quality of life’ mean?

Quality of life refers to the general well-being of individuals or societies.

Quality of life is a broader measure than ‘standard of living’. It encompasses standard of living (money-GNI), but it

also factors in social factors like life expectancy, education and perhaps environmental factors.

11. How can ‘Quality of life’ be measured?

The UN has used the Human Development Index (HDI) as an indicator of development. It includes:

Life expectancy

Educational attainment and average number of years spent in school

GDP per capita ppp

Each of the categories is given a score and the HDI is the average of the scores – 0.000 is the worst score and 1.000 is

the best score. The countries are then ranked in order from 1(the best) to 169 (the worst). If you look back at the

map of HDI on the previous page, it perhaps might make more sense?

12. Will different places have a different perception about quality of life and standard of living?

In Bhutan, culture and the environment are rated more highly than perhaps in the UK. In Kenya, the basics are

perhaps more crucial than our priorities like mobile phones etc.

13. How can people in ‘poor’ countries improve their quality of

life?

Often, people can live in ‘slums’, ‘shanty towns’ or ‘informal

settlements’. These are unplanned and are invariably poor places to

live. In the lessons, you examined the picture on the right and

discussed what challenges people would face. A lack of sanitation

and disease were the main issues.

However, things can be done to improve the situation In Nairobi, Kenya. See the table below:

Kiambiu Matopeni Korogocho

Christian Aid has a partner called Maji na Ufanisi (‘Water & Development’).

With MNU’s help, the residents have built 5 toilet and shower blocks; local people have been employed to clean and maintain them.

A small fee is charged and the money is used to improve life further in the community (healthcare etc.). They also have clean drinking water, which has helped immensely.

Catherine Kithuku has formed a group that organises rubbish collections and educates people about health in Matopeni.

She hopes that the MSU will find the money to work with her community too.

Don’t forget our school and our links with CAFOD.

We raised money for a gym to improve the quality of life.

We also raised money to send 175 children to school at St. John’s school.

PART B: GLOBAL INEQUALITIES ARE EXACERBATED BY PHYSICAL AND HUMAN FACTORS

14. Why are some areas more developed than

others?

There are a number of reasons for why some areas are

more developed than others.

The broad categories of factors are shown on the left

and discussed on the next page.

15. What environmental factors will reduce

development?

Development Indicator Honduras UK

GNI per capita ppp

$3750

(2008 est.) $36130

HDI

0.604

(2010) 0.875

HDI rank 106/169 26/169

Birth rate 26 11

Death rate 5 5

Infant mortality 22 5

Doctors per 1000 0.6 7.5

Life expectancy 70 80

Adult literacy (%) 80 99

Below poverty line (%) 59 20

These include things like earthquakes, volcanic eruptions and hurricanes. Poor countries tend to suffer badly from

these as they lack the money to prepare and recover from

them.

Case Study: Hurricane Mitch, Honduras 1998

The table on the right provides an indication of the status of

Honduras.

They were hit by Hurricane Mitch in 1998, which hit them

hard as they were reliant on agriculture.

Honduras relies heavily on selling coffee and bananas to

bring in foreign income, so when the hurricane wiped out

much of this crop, the effects were devastating.

Some facts: 5000 dies, 70% crops destroyed, 50% of all homes destroyed, 300km of roads wrecked, flooding and

landslides, repair of damage $2-3 billion. “Honduras has no money to pay for reconstruction. Its economy was wiped

out by the hurricane”, said the Honduran Ambassador to London.

10 years on…. Temporary bridges are still being used – one has fallen down three times as people gave stolen the

screws! There is still no National Emergency Plan and although $1 million was spent to deal with the impact of

flooding and landslides, 4 million (50%) still live in vulnerable places.

16. What social factors will inhibit development?

768 million people in the World don’t have access to a

reliable water supply (roughly 1 in 10 of the

population)

A child dies from a water-borne disease every 15

seconds

12% of the World’s population use 85% of the water

Access to water has a direct link with standard of living – see graph top right.

But what can be done about it?:

Water Aid – a charity/ NGO – try to improve

lives by providing safe water and sanitation – an

example being Mehari Abraha in Ethiopia. They

can provide spring wells to ensure a clean water

supply. The link is that if you have a reliable

water supply, you don’t waste time fetching

water (perhaps as few hours a day). You can

then spend time focussing on economic activity,

which leads to development. The same is true

due to the clean water – people don’t get ill and

can focus on making money.

17. What political factors will limit development?

In Zimbabwe (HDI rank 169/169!), political decisions (Robert Mugabe, president –

pictured left) were made to redistribute land (often violently) from the white farmers to

the majority black population. However, many didn’t have the experience to run the

farms. Equally, the fragmentation of the farms meant that productivity fell too.

Consequently, the economy failed and people did not have food to eat.

In Kenya, However, political unrest (e.g. clashes during elections in Kenya in the 90s and the 2000s) can mean that

tourists do not come, as they don’t feel safe. Their potential money is then lost. Equally, businesses are unlikely to

invest in such countries, which could prevent further development.

18. What economic factors can limit development?

More on this will be written in the next section, where trade is discussed. The problem comes from the fact that

many manufactured goods that Kenya requires come from abroad (i.e. they are imports). These are often high in

value. Therefore, the money going out of the country to pay for these items is less than that coming in for the

agricultural exports. Kenya spends more than they earn from the products they sell. This widens the development

gap as the balance of trade is more in favour of the richer MEDCs. In fact, most trade exists between MEDCs.

PART C: THE REDUCTION OF GLOBAL INEQUALITIES WILL REQUIRE

INTERNATIONAL EFFORTS

19. What does the term ‘trade balance’ mean?

Trade balance = the difference between imports and exports.

20. Why does the development gap exist due to trade?

21. Why else do poor countries remain poor?

Coffee and other agricultural products have World prices that fluctuate dramatically; producers (LEDCs) can really

struggle when prices are low. Manufactured commodities like TVs have relatively stable prices by comparison

(MEDCs) – another example of how trade is stacked in favour of MEDCs.

22. What are NICs?

They are examples of Newly Industrialised Countries (NICs) – examples include South Korea, Mexico, Singapore and

Taiwan. These have industrialised rapidly and now earn huge amounts from trade; 50 years ago, they were not

particularly developed. Famous brands such as Samsung and LG come from Korea. In fact, these companies are now

transnational companies (TNC)

23. Is trade fair and how can countries protect themselves from foreign imports?

Rich countries want to keep the balance of trade as it is and they employ protectionist policies to do this. Essentially,

they create barriers to protect their own jobs and industries through what are called as tariffs and quotas.

Look at

these two

countries –

you can see

how trade

favours

Japan!

Tariff: taxes paid on imports. These are added

to make them appear more expensive than the

domestic competition

Quotas: precise limits on the quantity of goods

that can be imported. Beyond these quota

levels huge taxes will be added to these

imports, making them more expensive.

24. What are trading groups?

Trading Groups: These are where countries group

together to increase the amount of trade between them and the value of their trade.

These can promote more trade between member countries, but those outside of the

group face quotas and tariffs to get their produce in to these areas.

Ghana produces cocoa beans. However, the EU has high tariffs on processed cocoa

products from Ghana, yet has no penalty on the import of raw coca beans from

Ghana – why? They want to protect their own producers of chocolate products by

providing them with raw materials at low cost, but preventing Ghana from getting

any of their processed products in. Unfortunately for Ghana, raw materials are often

sold for less profit than processed goods, thus maintaining the development gap.

25. What efforts have been made to reduce the imbalance of World trade?

The WTO

Trading groups helped member countries, but often penalised other countries.

The World Trade Organisation (WTO) deals with the rules of global trade. It tries

to make trade easier and remove any barriers preventing it; it also settles trade

disputes.

In theory, they are against any barriers to trade such as subsidies (where governments give money to their farmers

to help them) as rich countries can afford to do so, whereas poor countries can’t – i.e. unfair trade. However, the

USA and the EU still spend massive amounts on subsidies which means that their producers can produce huge

amounts of food. This food is then flooded on to the LEDCs markets where the LEDC farmers cannot compete on

price.

Fair Trade

Producers group together in poor countries to produce food for the fair trade market. Such

products have the logo (on the right), which shows consumers that the product is ‘Fairtrade’. The

prices tend to be a little higher, but consumers know that they have produced a fair price for

their product. They are also paid a ‘fair trade’ premium which is spent on community projects etc. to improve their

quality of life.

Co-operative

This is where producers group together and take a share of the profits. By grouping together, they are able to share

resources, which enables them to compete on price. For example, the Gumutindo Coffee Co-operative in Uganda has

3000 farmers that have grouped together. They process the beans themselves and use a shared warehousing facility

where the beans are milled before being exported. By doing some of the processing by sharing the milling facility,

they are able to make more profits.

26. Why are poor countries in debt?

The table on the right explains how they got

into debt.

Don’t forget how the imbalance of trade

features in this too – they operate at a trade

deficit.

27. What has been done to reduce this

debt?

In July 2005, the Live 8 concerts (8 around

the World) were aimed to try to help the

‘Make Poverty History’ campaign and cancel World debt. A few days later, the G8 (the World’s 8 richest

countries) met and an agreement was made to cancel all debts (worth $40 billion) owed by 18 highly indebted

Poor Countries (HIPC).The HIPC are a group of the 38 poorest countries. Eventually, $85 billion was cancelled,

but $300 billion still remained in Africa.

In order to have their debts cancelled, the countries had to agree to:

Show that they could manage their finances and were not corrupt

Agree to spend the money they would have spent on debt repayments on education, healthcare and

reducing poverty

It made a large impact – look at the table below to see how the cancellation of debt had a positive impact on

Uganda.

28. Other than cancellation, how else can debt be reduced?

An interesting concept called ‘conservation swap’ or ‘debt-for-nature swaps’ tackles debt, but also benefits nature.

A country (creditor) which is owed money from another country (debtor), cancels part of the debt in exchange for

the debtors country’s agreement to pay for conservation activities. NGO (non-government organisations) like the

WWF (World Wide Fund for Nature) often help to arrange the swaps.

Case Study: Debt-for-nature swap in Peru

In 2002 and 2008, Peru and the USA agreed to swap debt worth $40 million. Peru agreed to conservation activities to

preserve more than 27.5 million acres of endangered rainforest. The forest provides rare habitats for jaguars, pink

river dolphins and other are species.

29. If debt isn’t cancelled, what impact can this have on the environment?

In Honduras (do you remember Hurricane Mitch?), 800km² or rainforest is cut down every year, to be replaced by

ranches, banana plantations and small farms. The connection is that the trees provide hardwood that is sold

overseas for foreign money to repay the debt. The new fruit plantations also earn money to repay their debt. In fact,

20% of the money Honduras earns is spent on debt repayments.

30. What is Aid?

Aid is when a country receives help from another

country, or an organisation such as an NGO, to help it

to develop and improve people’s lives.

Aid can be delivered in a number of ways – see the

picture on the right.

31. What ways can Aid be classified?

Remember, the donor is the country or organisation giving the aid. The recipient is the country receiving the aid.

32. Top-down or bottom-up?

Bottom-up is a localised approach – for example our work with St. John’s school, Korogocho with the help of CAFOD.

Top-down is when a large-scale project is completed – e.g. vaccinations of all children in the country against a

particular disease.

Have a think about the advantages and disadvantages for the recipients and donors in each of the case. Cost? Local

decisions? Targeted for individual communities?

33. How can aid lead to sustainable development?

Sustainable development = ‘meets the needs of the present without compromising the ability of future generations

to meet their own needs’

Case Study: FARM-Africa and the Moyale Pastoralist Project

This project is helping communities in Northern Kenya to survive, by reducing their dependence on their animals for

all of their income. The project is:

Helping communities to form Local Development Committees (LDC) – which finds problems and solutions –

e.g. improving access to markets, so that farmers can sell their produce more easily.

Helping families to adapt the way they manage crops, animals and forests to improve their sustainability –

e.g. avoiding deforestation, which destroys the soils.

Provide small-scale loans to set up alternative business, such as small shops.

Training people to identify clean, safe water sources and to dig wells.

Saku, a local woman, applied to the LDC for a small loan. The money was used to set up a small shop and she can

now afford the essentials such as healthcare, education and food. She has now repaid the loan, so the money can be

lent to someone else.

34. Trade or Aid?

We are very good at providing aid after a major disaster, but governments can be less generous. The UN set a target

that every year richer countries should give 0.7% of their GDP to poorer countries. Not many countries meet this

target!

However, in the long term, trade is much better than aid in helping poor countries to develop. Trade creates jobs,

which provides wages that people spend on improving their quality of life.

PART D: THE COUNTRIES OF THE ENLARGED EU SHOW CONTRASTING LEVELS

OF DEVELOPMENT WHICH HAVE LED TO A NUMBER OF POLITICAL

INITIATIVES AIMED AT REDUCING INEQUALITIES

35. What is the EU?

It was originally set up in 1957 to achieve economic and political cooperation

after the 2nd World War. The number of countries has grown dramatically in

the last decade and there are now 28 member states.

36. Do differences in development exist within the EU?

The EU is a very rich region, but there is still a big gap between its richest and

poorest regions.

The richest regions include areas like London, Brussels and Hamburg. Luxembourg – the richest country is more than

seven times richer then Bulgaria or Romania, the poorest members of the EU.

37. A comparison of two countries in the EU

UK Poland

The UK is part of the EU’s ‘core’ or centre. Such regions create the most wealth and have larger populations. They produce and consume most goods and services and have the best communications. UK joined the EU in 1973 and is rich. However, 14% live in poverty. The global recession has meant that we have a trade deficit – 351.3 billion exports and 473.6 billion imports in 2010. GNI/capita ppp: $36,130 HDI rank: 21 Employment structure: 1.4% Agriculture, 18.2% industry and 70.4% services

Poland is on the ‘periphery’ or edge of the EU. Such countries have poorer populations and poorer communications. Belonging to the EU has helped them develop. Poland joined the EU in 2004; it used to be a communist country. 17% live in poverty. Hundreds of thousands of Polish migrants came to the UK to find work after joining the EU (see Population case study!) Trade deficit – $134.7 exports - $141.7 imports. GNI/capita ppp: $17,310 HDI rank: 41 Employment structure: 17.4% Agriculture, 29.2% industry and 53.4% services

38. What is the EU’s regional policy?

The policy transfers resources from richer to poorer areas.

Between 2007-2013, regional spending will have used up 36% of the EU’s spending - $350 billion!! The focus is on

countries in Central & Eastern Europe – like Poland. The money comes from three sources:

The European Regional Development Fund, which pays for general infrastructure

The European Social Fund, which pays for things like training and job creation programmes

The Cohesion Fund, which covers environmental and transport infrastructure projects, as well as the

development of renewable energy. You have to be a country with living standards less than 90% of the EU’s

average to qualify for this funding – Poland qualifies!