Booklet 5 - Bretton Woods Institutions and the WTO Flashcards
(18 cards)
What are structural adjustment Programmes (SAPs)?
Consist of loans provided by the IMF and World Bank to countries in economic crisis
What do the Two Bretton Woods Institutions require?
- Borrowing countries to implement certain policies e.g. privatisation of poorly run government services, or withdrawing costly state support of inefficient industries, in order to obtain new loans
- Forces them to concentrate more on trade and production to boost their economy
- SAPs generally implement free-market programmes and policy
- Programmes include internal changes (privatisation) as well as external ones, especially the reduction of trade barriers
Role of the IMF:
- ‘Lender of last resort’
- Regulate financial flows
- Provide financial institutions
- Short Term help for all nations
- Provide Structural Adjustment
Criticisms of the IMF
- Too harsh loan conditions
- Force countries to reduce borrowing, cut corporate taxes, open up to foreign investment
- Wealthy nations have more influence
UK’s history with the IMF
- Founding member in 1945
- Required a $3.9 bn bailout loan in 1976, largest amount requested from the IMF at the time
- In September 2022, the IMF criticised the Conservatives’ unfunded tax-cutting plans.
Role of the World Bank
- Long Term investment through International Bank for Reconstruction and Development
- Promotes Poverty Reduction in developing nations, assisting development
- Encourages firms to set up in developing countries
- Prevents corruption and aids sustainable development projects
- Administers debt relief to bring it down to a more manageable level
- Only charges 0.75% of loan back, so they are more like grants
- Requires structural adjustment when providing loans
Criticisms of the World bank
- Top-down approach may not reduce poverty on a local scale
- Conditions include reproduction of capitalist and free-market trade models, which don’t always reduce poverty
How may neo-liberal policies lead to inequalities and injustices?
Free-trade market does not necessarily lead to economic growth and may cause inequalities, may be asked to implement austerity measures, e.g. cutting spending on health and education which may lead to further inequalities
What is the WTO?
World Trade Organisation
A forum for governments to negotiate trade agreements
Example of how the WTO helped to promote growth and stability:
Doha helped to reform trade in agricultural produce between advanced and developing countries to help reduce inequalities
How has the WTO created inequality and injustices?
- Slow processes in negotiating deals- Doha round talks which help to provide developing nations with better terms of trade- 2001-2015
- Failure to confront ethical issues originating from trade- e.g. child labour
- Failure to tackle environmental issues e.g. depletion of global fish stocks increases injustices
What is multiscalar power?
The ability to influence behaviour and attitudes through interactions at different scales to encourage or prevent change.
How has there been a response to climate change on a local, regional, national and international level?
- UNFCC - Paris Climate Change summit- stops temps going above 1.5 DC
- Government response- lack of action
- Citizen response- Greta Thunberg- 1.5 m ‘school strike for climate’- protest + NGOs- Greenpeace
- UK Government response- declared ‘environmental climate emergency’ due to promise
Role of NGOs in global governance:
Mobilise strong support from individual citizens, giving them more authority to challenge the excess of TNCs and national governments that threaten equality, justice of the environment and to influence governance
What is an operational NGO?
- Those providing frontline support services to the needy
- e.g. Oxfam
- Raise money for each project which they undertake
What is an advocacy NGO?
- Those who focus on campaigns to raise awareness to gain support for a cause
- e.g. Greenpeace
- Derive money from donations and, in some cases subscriptions
Pumpkins against poverty (practical action NGO example):
- In Bangladesh, 160 million people still live in poverty (less than $1 a day
- Every year monsoon rains cause the three major rivers of Bangladesh to swell, resulting in devastating floods
- Introduced a technique called sandbar cropping which allows the pumpkins to be grown on the sandy, barren soil left behind when flood waters recede
- By digging holes in sandy residues left by the flooding and filling them with manure, compost and pumpkin seeds crops can thrive
