The World Bank The World Bank Aims to help development by advising and lending

The world bank the world bank aims to help

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The World Bank The World Bank Aims to help development by advising and lending – with many conditions – such as reducing wasteful spending or focusing on a particular area of production Countries encouraged to lift import and export barriers, cut subsidies and remove price controls encouraging free trade These are longer term loans, used to put in place infrastructure or other big projects. 56
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The World Bank Operations The World Bank Operations Types Types Investment Projects Pre-defined specific project Implementation aspects defined Adjustment Operations Structural and Sectoral Policy Reform Program Operations Multi-year investment program Investments not precisely pre-defined Guarantee Operations 57
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Criticisms of the World Bank Criticisms of the World Bank Loans depend on countries agreeing a Structural Adjustment Programme Leads to rapid increase in price of goods in the country Increases poverty Lower investment and cut social spending Little evidence that these policies work These criticisms are similar to the criticisms of the IMF 58
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The World Trade Organization The World Trade Organization (WTO)? (WTO)? The WTO deals with the rules of trade between countries Over 150 countries belong to WTO It developed from the General Agreement on Tariffs and Trade (GATT) WTO agreements set the ground rules for international commerce – Designed to ensure free trade and to prevent unfair trade advantages 59
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Mission of WTO Mission of WTO Monitoring national trading policies Handling trade disputes Enforcing GATT agreement Reduce tariffs and other international barriers Eliminate discriminatory treatment in international commerce 60
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10 Benefits to the WTO 10 Benefits to the WTO 1. Keeps peace, no wars over trade disputes 2. Disputes handled constructively 3. System based on rules rather than power designed to give Least Developed Countries(LDCs) a fair chance 4. Freer trade cuts the cost of living 5. Gives consumers more choice 61
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10 Benefits of the WTO 10 Benefits of the WTO 6. Trade raises incomes 7. Trade stimulates growth, including employment 8. Basic principles makes system more economically efficient 9. Shields governments from narrow interests 10. Encourages good government 62
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Arguments against the WTO Arguments against the WTO 1. Only serves interests of multinational corporations 2. Is a stacked secretive court – favoring multinational corps 3. Tramples over labour and human rights 4. Undermines national sovereignty 63
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Trading blocs Trading blocs A trading bloc is a group of countries that sign an agreement to reduce tariffs, quotas and other barriers between each other The creation of a trading bloc can be seen as the first step in economic integration (like with the EU, ECOWAS, etc). The order is: 64
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Trading blocs Trading blocs Preferential trading areas Members sign up to a preferential trading agreement under which they agree to reduce barriers on a range of goods Free Trade Areas - Members agree to eliminate all barriers between each other - Each country negotiates independently the barriers it has with countries outside the bloc - Quick research – which are the main free trade areas 65
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