Many have tried to draw upon the legacy of the colonial system to explain the reasons for underdevelopment in many areas of the world. Most areas that suffer from poverty today are former colonies the developed nations, for the most part, are former metropoles. The colonizers exploited their underlings in colonies, turning them into suppliers of cheap raw materials and restricting the infrastructure construction, leaving former colonies with only basic facilities. In many cases, when the colonizers departed, the nations were left with artificial boundaries that separated them from each other without regard for their historical development. This fuelled subsequent separatism and military conflicts, hampering economic progress. Thus, if one looks at straight-line boundaries in Africa which we are now learning in DS 202, it becomes obvious that those were artificially created.
The colonizers, in particular the British Empire, were suppressing the industrial development in their colonies because they viewed them as sources of cheap imports and at the same time large markets for their industrial goods. An example of north-eastern Brazil that often surfaces in literature on underdevelopment, (Taylor 2001) claims that north eastern Brazil in the 19th century would have appeared to be an ideal place for a textile industry with its high quality cotton and existing demand for sugar bags cloth and slave clothing. However, to develop the textile industry, it would take years during which the industry should have been shielded from foreign competition with import tariffs and quotas. This was surely not something Britain would allow in its colony. As a result, the fledgling Brazilian textile enterprises proved unable to withstand the competition with Britain’s textile industry. Britain, like almost any metropole, was interested in selling to the colony, not developing industry inside it. As of 1822, when Brazil received independence, it was a larger export market for Britain than all the rest of Latin America combined (Taylor, 2001).
Naturally, even as Brazil proclaimed independence, Britain did not want to lose this lucrative market and demanded a trade treaty with Britain which prohibited import substitution tariffs (Taylor, 2001). Brazil was forced into this treaty by its political weakness. In this way, former metropolitan powers keep control of their former colonies to varying extents, blocking their effective development. In newly independent nations of Latin America, for instance, the warfare that often preceded proclamation of independence devastated regional and national economies (Kinsbruner 1994 pg 126). Although this perspective is not universally recognised, the IMF and the World Bank for imposing policies said to aggravate third world countries. The stated goals of both institutions are certainly to spearhead economic growth in nations they service with their financial programs. Critics , however , point out that loans from the World Bank and the IMF often come with conditions that block the road to sustainable development and make poverty even worse .
The Structural Adjustment Policies (SAPs) imposed by the IMF as a prerequisite for qualifying for its loans often aggravate the deplorable condition of the third world nation. Thus, SAPs often call for reduction in government expenditures for health, education and other government services for the sake of debt repayment. In this way, third world nations are dragged into the quagmire of debt repayment, as their interest provides income for Wall Street banks and other financial institutions. IMF policies urge third world countries to increase their exports of raw materials and agricultural products in to cope with debt – an immediate concern. This, however, reduces the amount of food available to the poor inside the country and can lead to starvation second, does not create conditions for building processing industries that will increase value added inside the country. Besides, the IMF often demands for liberal market reforms that involve privatisation that, without proper preparation and evaluation of potential consequences, can lead to loss of jobs, aggravation of the social situation and civil unrest.
Such measures lead to social discontent that can hamper the development of economies in developing countries. With respect to harmful policies imposed by the fund, Amin notes that the key to development is subordination of outside relations to the logic of internal development and not the reverse as it is happening when development policies are imposed by outside financial institutions (Amin, 1995 pg 10). The harmful role of the World Bank and the IMF in the development of poor nations is by no means indisputable. However, there are many criticisms aimed at the policies that accompany loans and the very idea of reaping interest income off the populations of the nations where starvation is a widely spread phenomenon. Political Aspects. Many regions of the world that demonstrate marked third world are characterised by overt concentration of power in the hands of a
rich minority that uses this power to oppress the majority.
For example, the North-eastern areas of Brazil that rely on sugar production as the primary source of income are seriously underdeveloped as compared to the rest of the nation. The property patterns in this region are the history of the dominant class manipulating social, political, and economic institutions so as to expropriate the maximum possible surplus from the rural workers (Taylor, 1978 pg 57). The economic interests of the land-owning class lay in extracting as much as possible from their plantations and workers as opposed to investing in the area. The result is miserable since an area that specialises in agricultural production cannot even feed its own citizens and has to import most of its agricultural produce from the rest of the nation. With a stagnant economic situation, the north-eastern Brazil has suffered from health education, and literacy standards that ended in a peasant revolt in the 1960s (Taylor, 1978 pg 157) Regional Inequalities. Many travellers to nations like China, India or the Caribbean are immediately impressed by the contrast between squalor of provincial areas and the apparent luxury of large cities and some ‘advanced’ areas.
Regional inequalities contribute to underdevelopment, creating a situation when some areas are on their way toward modernisation, while others are forced into the backseat of social and economic progress. The importance of regional inequalities as source of underdevelopment is explored, for instance, in Andre Gunder Frank ‘s 1989 publication The Development of Underdevelopment (Frank 1989) challenges the view that third world nations are still going through the stages that more developed countries are done with. Instead, he asserts that problems of underdeveloped areas are the inevitable result of the capitalist system. The same, in his mind, is true of the regional disparities observed in the third world countries where the capital and larger cities often stand out as oases of advancement among the generally gloomy landscape around. The underdevelopment phenomena in the province are the products of the historical development of the capitalist system no less than are the seemingly more modern or capitalist features of the national metropoles of the third world countries Frank (1989, pg 37). Education and Training.
A well-trained and educated workforce is the necessary precondition for successful economic development. The presence of a large educated population contributes to India’s current rise as an outsourcing destination, although it has so far failed to ensure overall prosperity in this nation. This problem, for instance, is addressed in Canadian programs targeting development of Aboriginal areas. The Indian entrepreneurship has to be supported with knowledgeable workforce that will attract capital flows to the areas. Although the fact that Native Americans missed the industrial revolution ‘ has its upside, as there is no need for re-training, integration of these people into the complex web of the global economy is a serious challenge (Kendall , 2001).
Similar problems are experienced by many third world countries only in their case unlike the situation of Aboriginal populations in Canada, there is no strong nation to back them up in the efforts to increase their education. Cultural Factors. Culture, to some degree, can also adversely impact development or contribute to it. The modern world is patterned to a great extent after the Western cultures of the nations that have a dominant role in this world. Those that do not fit into these patterns will not achieve success as their development would ideally proceed along different lines. An example can be the case of Africa and Native Americans in Canada.
Although living in a highly developed and prosperous nation, Native Americans, South Africa and even Zimbabwe, the Aboriginals fail to attain economic well-being. One reason that precludes their success is supposed to be their culture that envisages collective ownership and sharing of resources, as opposed to the idea of individual private rights that characterizes Western culture Kendall, (2001 pg 43). Industrial technology best develops in conditions that favour private ownership however, for these countries, it often means they have to abandon their cultural values which in most cases is not the case.
The difficulties of modernising and developing third world countries are multiple. More often than not different factors of third world countries will be present in areas affected by this problem, intertwined and perpetuating each other. Thus, the political situation marked by elite domination perpetuates economic inequalities that in their turn cause inadequacy of educational facilities and ensuing lack of local qualified specialists. Lack of medical services can lead to absence of effective family planning measures that in their turn lead to overpopulation and then to poverty as the national GDP struggles to catch up with economic growth. Therefore, addressing a set of problems rather than separate issues is the cornerstone for building an effective development program.
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Topic: Dependency Theory and Colonial Heritage
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