Attempts to reduce imbalances in world trade & poverty
This
is a scheme designed to get a better deal for the producers of the
primary products that MEDC countries need. The producers get access to
the market for their goods, a contract (for extra financial security),
better prices for their products and access to the Fair Trade Premium,
which is a sum of money available from the Fair Trade foundation to be
spent upon improving yields, farming practices, health care or
education. You can
find out more about the fair trade foundation
and its producers here.
Many
LEDCs took out huge loans (for Millions of pounds) during the 1970s,
offered to them by banks and governments in rich MEDCs. The LEDCs wanted
to use the money for various development projects such as building dams,
roads, schools etc. The idea was to help countries to develop by
improving their industries and infrastructure.
The loans had to be paid back, and the longer
the loan went unpaid the larger it got, because the MEDCs added a sum of
money called interest every month. Over time these loans got so large
because of interest that some LEDCs would never be able to pay them off.
It also meant that some MEDCs spent more on loan payments than on health
care and education for the people living in their countries. This has
had a really damaging effect on the quality of life of people who live
in these areas. Countries can borrow money from many sources, including
other countries, banks and international organisations such as the
International Monetary Fund (IMF) and World Bank.
If a project succeeds debts are easily repaid
and there is no issue.
However, if a project fails debts can build up
because of the interest and countries can get into huge financial
trouble.
This issue can massively affect the development of a
country, which directly affects the standard of living of the people who
live there.
In the run up the new millennium a campaign was started to drop
the debt, which has had some success in cancelling some debt, freezing
the interest on some debt and in some cases giving the poorer LEDCs more
time to pay back their debts. This campaign was called
Jubilee 2000.
As a result of this campaign the UK government cancelled much but not
all of the debts owed to it by poorer nations.
Banks have not cancelled debts however, and many
countries the world over suffer the effects of debt.
CONSERVATION SWAPS
This is another way for poorer countries to make money and get
themselves out of debt.
Many poorer countries have abundant natural
resources and these can be used or exploited in many ways.
The rain forests are a good example; these are
exploited in an unsustainable manner for wood, agriculture and mineral
wealth.
Conservation swaps offer an alternative to poorer
countries to reckless exploitation of their natural wealth.
These swaps basically see poorer countries have
portions of their debts wiped out or paid for by richer nations or
charities of richer nations in exchange for promising to protect or
CONSERVE large parts of their natural environment.
This has large scale global effects, by
protecting the atmosphere and the hydrosphere.
In 1984 the World Wildlife Fund came up with the
idea of conservation swaps and in 1987 the first was launched in
partnership between the
Government
of Bolivia and Conservation International (CI) for US$ 650000 which
protected 3 natural areas. Many countries have since followed, including
the Philippines, Sudan, Zambia, Ecuador and Uganda.
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