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DEVELOPMENT - Coggle Diagram

- - - - Africa is the poorest continent in the world
      - (Africa is 3 times larger than Europe yet has 4 times the amount of coastline.
    - - form a Regional Trade Agreement with your neighbors so that you have free trade access
      - Switzerland/Austria -Uses its rivers but also has rich neigbours
  - - - Variable harvests and speculative demand causes harsh price swings
      - Leads to lack of investment and confidence
      - Lower productivity
      - H Buffer stock policies keep prices stable
    - - A big rise in commodity revenue may cause the currency of the country to rise and negatively affect other sectors of the economy such as manufacturing
      - The Benefits from rising commodity export revenue must be weighed against the costs in other sectors
      - Manufacturing is more long term-LEWIS MODEL
  - - - Transport costs are 40% of roduct costs in Africa- Decreasing international competitivness
      - Specialisation and trade cannot occur
      - Reduces labour mobility
      - Discourages FDI
    - - 12% of its GDP on infrastructure
      - Over 50% of China’s AD comes from Investment
  - - - Savings fund investment
    - - In Africa for example, savings rates of around 17 percent of GDP compare to 31 percent
      - 2/3 of Adults in Cambodia have access to Micro Finance
    - - Essential for providing long term capital for the private sector and helping to channel savings and provide funds for investment projects.
- - - - Mean years of schooling
    - - Life expectancy at birth
    - - GNI per head at PPP
    - - Human rights/other quality of life factors are not included
      - Quality of education is not accounted for
      - Does not include inequality
        
        H there is an inequality adjusted HDI
- - - - Will stregthen the currency-Dutch Disease
      - Will increase jobs as it is a labour intensive industry
    - - State will need to manage capital in order to promote it
  - - - H debt is dangerous
      - Presents a interest payment cost
      - Micro finance schemes-used to resolve savings gap
    - - Largest source of finance to developing countries
      - Used to find infrastructure projects- L RAS and AD
      - Policies used to attract FDI
        
        Low rates of corporation tax,
        
        Creation of Special Economic Zones
        
        Low unit labour costs
      - Provides an improvement in the financial account-but eventual worsening of the current account
        
        Depends where the profit goes
        
        Will strengthen the currency, dutch disease
    - - Can be dangerous and countries can become reliant
    - - Transfers of money across national boundaries by migrant workers.
      - +
        
        additional disposable income which helps to fund education & health care
        
        Helps families to invest
        
        Lower risk of extreme poverty
        
        Lower Gini coefficient if they flow to poorest rural areas
      - -
        
        May just be spent and not saved
        
        Some households receiving remittances may decide to remain inactive in the labour market
- - - - The level of national saving
      - The productivity of capital investment
    - - Many developing countries lack a sound financial system
      - difficult for low income people to save with most income spent on necessities
      - Needs an educated workforce to make use of investment
  - - - A worker in a factory is more productive than a worker in the fields
    - - Needs efficient technology