CW_L7.GlobalDivide_.pptx powerpoint in contemporary word

CW_L7.GlobalDivide_.pptx powerpoint in contemporary word

1. NORTH south divide

2. LEARNING OBJECTIVES Define the growing disparity known as Global Divide Identify the different indicators or determinants of Global Divides Compare and Contrast the different indexes in Global Development.

3. WHAT IS THE NORTH-SOUTH DIVIDE?

4. North-South Divide defined N-S Divide refers to the economic gap between the northern “rich” countries and the southern “poor” countries.

5. North-South Divide Geography and culture are not wholly the reason why there are rich and poor countries but its because of the established institutions they gradually instituted. ( Acemoglu and Robinson – “Why Nations Fail” )

6. Issues in the North-South Divide Distribution of Income around the World Economic Competition World Wide Standard of Living

7. GDP vs GNP GDP is all the final goods produced within a domestic territory irrespective of the person producing. GNP is the final goods produced by citizens of a country irrespective of where they are produced in the world. GROSS DOMESTIC PRODUCT GROSS NATIONAL PRODUCT GDP per capita = GDP Population GNI = GDP + Income of Nationals abroad – income remitted by foreigners back to their home country Population INCOME

8. GNI per capita

9. Economic Competition defined Competitiveness is defined as the function of the set of institutions, policies, and factors that determine the factor productivity level in a country. 12 Pillars of Competitiveness (Global Competitiveness Report)

10. Economic Competition defined

11. Economic Competition defined

12. Economic Competition defined

13. Economic Competition defined

14. Standard of Living explained HDI is the tool used to measure a country’s overall achievement in its social and economic dimensions. HDI stresses the importance of quality of life.

15. Major Difference in North-South Divide NORTH SOUTH Less Population High Population High Wealth Low Wealth High Standard of Living Low Standard of Living High Industrial Development Low Industrial Development Industry Agriculture

16. Classifying Countries Most Developed Countries (MDCs) - The richest, most industrialized and democratic nations of the world. Less Developed Countries (LDCs) - Countries with little industrial development, little wealth, and high population growth Least Developed Countries (LLDCs) - Very low per capita income, low literacy rates, and very little in the way of manufacturing industries

17. Why such huge gap exists? 1 2 Colonialism Weak & Inefficient institutions 3 Overdependence on natural resources (Law & Government) (Core-periphery system has become deeply embedded in state apparatus) (Resource Curse)

18. Why such huge gap exists? 1 2 Colonialism Weak & Inefficient institutions 3 Overdependence on natural resources Globalization as a uneven process

19. UNEVEN PROCESS Globalization as a uneven process Catch-up States Lagger States States who are able to adapt to the economic environment driven primarily by Globalization. These states are characterized by high per capita income, high standard of living and extreme competitive labor and business. States who finds it hard to adapt to the globalized economic environment. This inability to adapt may be rooted on a number of reasons – weak institutions, pervasive corruption, unskilled labor force etc.

20. CATCH UP STATES EAST ASIAN TIGERS EA Tigers refers to the states (South Korea, Taiwan, Hong Kong, Singapore) which underwent rapid industrialization and were able to maintain an economic growth from 1960’s to 1990’s . These states targeted MNCs to invest on their cheap labor and were able to divest their economies later on.

21. WHY EAST ASIAN TIGERS? EAST ASIAN TIGERS The Asian Tigers were heavily industrialized by manufacturing TNCs in particular. The advantages of these countries to be the host countries for large TNCs were: A reasonably well-developed level of infrastructures such as roads, railways and ports. Relatively well- educated population with existing skills. Cultural traditions that appreciate education and achievement.  Good geographical location - Especially for Singapore as it is situated between the Indian and Pacific Ocean, which made it perfect for trading, imports and exports. Government support , for example, offering low-interest rates in bank loans. Less rigid laws and regulations on labour , taxation and pollution than in home countries of TNCs, allowing more profitable operations. (Low-cost manufacture with cheap labour ). ( Development&Globalization.weebly.com )

22. WHY EAST ASIAN TIGERS? SINGAPORE After Malaysia decided not to take Singapore as part of it in 1965, Singapore faced: High unemployment rate Low Income ($516 in 1965) Mostly illiterate population Housing problem

23. Class Discussions: 1 2 What could be the reason why huge disparity in the world exist today? 3 What could be the main reason the Philippines remains to be economically poor relative to other states? How do states close the gap between the rich & the poor?