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Causes of World Disparity Poverty • The new poverty line of $1.25 a day was recently announced by the World Bank (in 2008). For many years before that it had been $1 a day. Rich/Poor Gap Rich/Poor Gap What does it mean? - The gap that exists between the rich in a society (the world) and the poor in a society (the world). - This is also known as disparity or global inequity. “The worst form of violence is poverty”. ~ Mahatma Ghandi Rich/Poor Gap What does it mean? • People in poor countries earn less than someone in Canada for doing the same job? (on average they make 100 times less than us for the same job) Imagine someone making 100 times more than you for doing the same job. the numbers you are… part of the 6% on the planet that owns 60% of the world’s wealth part of the 7% on the planet that are educated at the secondary level part of the 12% on the planet that owns a computer part of the 3% on the planet that has internet connection Global Inequity – Gap Between Rich and Poor • The GDP (Gross Domestic Product) of the 41 Heavily Indebted Poor Countries (567 million people) is less than the wealth of the world’s 7 richest people combined. • More than 80 percent of the world’s population lives in countries where income differentials are widening. • The poorest 40 percent of the world’s population accounts for 5 percent of global income. The richest 20 percent accounts for three-quarters of world income. In 2005, the wealthiest 20% of the world accounted for 76.6% of total private consumption. The poorest fifth just 1.5% • World gross domestic product (world population approximately 6.5 billion) in 2006 was $48.2 trillion in 2006. • The world’s wealthiest countries (approximately 1 billion people) accounted for $36.6 trillion dollars (76%). • The world’s billionaires — just 497 people (approximately 0.000008% of the world’s population) — were worth $3.5 trillion (over 7% of world GDP). • Low income countries (2.4 billion people) accounted for just $1.6 trillion of GDP (3.3%) • Middle income countries (3 billion people) made up the rest of GDP at just over $10 trillion (20.7%). • An analysis of long-term trends shows the distance between the richest and poorest countries was about: • 3 to 1 in 1820 • 11 to 1 in 1913 • 35 to 1 in 1950 • 44 to 1 in 1973 • 72 to 1 in 1992 Energy Poverty • 1.6 billion people — a quarter of humanity — live without electricity: • Breaking that down further: • Number of people living without electricity (in millions) • Asia 706 • Sub-Saharan Africa 547 • East Asia 224 • Other 101 Lack of Investment • Lack of domestic or foreign investment • Why is there little investment? • Provide a suitable climate for investment…war/confl ict keeps investors away Population Growth • • Developing countries are still experiencing higher population growth rates than 1st world countries These countries currently struggle with providing a decent standard of living to a growing population (food, water, jobs, health care, education etc.), so what will they do if their populations continue to grow (ex. India 1.1 billion to 1.7 billion by 2050) • • • • • The problem here is that in many poor countries the majority of the population are employed in farming, thus requiring the need for large families. If the economy were to develop, the number of people involved in farming would diminish, and therefore reduce fertility levels Governments may take different approaches to curb population growth Some countries may choose to focus on educating its citizens on the benefits of having smaller families Some countries may be forced to take extreme measures and enforce limits on children such as China First world countries may be able to provide some help by providing aid/assistance for those people in developing countries who cannot afford birth control Disease • Core countries disease helps economy • Periphery countries, disease keeps people in poverty • Effective and affordable treatment of disease would help a periphery country to grow • Where is this technology developed, and who controls the market? Foreign Debt • • • Many developing nations are indebted to 1st world countries Many countries who are indebted, can only afford to pay the interest on the loan, and never really are able to pay down the principle loan If the government is focused on paying off loans from 1st world countries, there is little money to reinvest back into the country to help them escape the cycles of poverty (ie. money is leaving the country vs. staying in the country and building up their economy) • • • • In some cases 1st world nations may provide full or partial debt forgiveness Countries may decide to not charge interest on the loans, therefore allowing the country to chip away at paying off the principle Some debt relief programs, such as the Debt For Nature program in Brazil, provide the indebted nations a break in their loan payments in return for protecting fragile or important ecosystems (ex. 20 million dollar forgiveness for 1000 acres of Amazon rainforest) Live 8 concert - promote awareness of world poverty and pressure governments to address global poverty • Live 8 was a string of benefit concerts that took place on July 2, 2005, in the G8 states and in South Africa • Run in support of the aims of the UK's Make Poverty History campaign and the Global Call for Action Against Poverty, the shows planned to pressure world leaders to drop the debt of the world's poorest nations, increase and improve aid, and negotiate fair trade rules in the interest of poorer countries. Sub-Saharan Africa, the poorest part of the planet spends $25,000 per minute on debt repayment. This is money that could be spent on hunger, disease and education The South finances Northern creditors to the tune of about 200 billion dollars per annum in debt repayments For every $1 in aid a developing country receives, over $25 is spent on debt repayment. War • Wars and civil unrest in some • The need here is to bring developing nations have been about economic and going for decades (Congo, political stability and end Sudan, Uganda, Colombia) these conflicts • In zones of peace, countries • United Nations can focus on economic growth intervention, cut-off aid? • In zones of war (much of Africa • Recent example of Syria and parts of Asia), the current – Turkey cuts off leaders focus their time and electricity, other Arab money to try and prevent a nations threaten to pull coup d’etat (overthrow the them out of Arab League gov’t by forces) • In some cases their citizens are robbed, raped, tortured, and starved to keep them from uprising against the gov’t Corrupt Leadership • • • • Leaders in developing nations who put their own economic/political interests ahead of the people’s needs To do this they may resort to tactics such as diverting money to line their own pockets, stealing aid that was given by 1st world countries, starving its citizens to keep them from a revolt, or recruiting children to fight for their cause Odious debt (debt created by unscrupulous leaders to meet their own needs – Mubarak, Ghadaffi Kleptocracies (leaders steal from poor, control their people through poverty/hunger) • Solutions • Impose economic sanctions (cut off trade or aid with that country) • Potentially assassinate a leader – Saddam Hussein • Try and promote democracy in that country to help citizens elect a leader who works in the people’s best interest vs. their own best interest (financially reward a good leader??) • Arab Uprisings Trade Inequities • Simply put, rich countries trade with other rich countries • They do this by placing higher tariffs on items from developing nations vs. G8 partners (free trade agreements) • G8 nations subsidize (give them money) industries such as with agriculture to make their products as cheap or cheaper than goods from developing nations • Need to put in place a world trade system that allows developing countries to participate in world trade and develop their economies vs. relying on aid Local Control • Feel that the control of their country is in the hands of 1st world countries, corporations and world organizations such as the UN, World Bank, IMF, WTO etc. (these organizations may provide various forms of aid - neocolonialism) • Government corruption also affects peoples control over their own affairs • These sentiments may fuel resentment towards the “haves’ and may connect directly with acts of terrorism • Use NGO’s to help teach the citizens how to be more self-reliant • Ex. Engineers Without Borders • Provide better aid from first world countries that allows countries to help lift themselves out of poverty • Getting rid of corrupt government (Arab Spring Uprisings – promoting democracies vs kleptocracies) Role of Women • In some societies, there are huge inequalities between the men and women • How will a society be impacted in a society where women are expected to stay at home and raise kids (a huge chunk of your society isn’t working) • Shift cultural attitudes as to how women are viewed in a society • How do you change attitudes that have been in place for centuries?