Factors that promote or hinder development

FACTORS THAT PROMOTE OR HINDER DEVELOPMENT

Indicators of Economic Development

This refers to the various factors that are used as means of determining whether a country is a developed or a developing country. These indicators fall into two broad categories, namely:

(a)Economic factors

(b)Non-economic factors

Concepts of Development

Development – refers to the sustained level of economic and social well being in a country.

Sustainable development – refers to the concept of advancing a people’s quality of life, in terms of economic criteria as well as human dynamics, particularly the conservation and protection of the environment.

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INDICATORS OF

ECONOMICDEVELOPMENT

Levels ofInvestment

Levels of Infrastructure

EconomicIndicators

Productivity

Employment SustainabilityPer Capita

Income

Social Indicators

Political IdeologiesThis fosters fragmentation and makes countries vulnerable to external interference in domestic affairs of the countries. It also limits the extent to which countries are able to forge a coordinated foreign policy.

The region has also been able to maintain stable and democratic governments, which have provided opportunities for economic stability and favourable investment climate.

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Distribution of WealthWhen concentrated in the hands of a few, it can lead to low levels of investment, high unemployment, high levels of unskilled labour force (since there will be low expenditure on education. It can also lead to corruption

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The result is low productivity among high-income earners, capital flight and brain drain. It leaves government with a high borrowing from international sources, which result I higher taxes and rising inflation.

Distribution of WealthTo solve this, incentives for production have to be offered to attract investors and government has to increase its involvement in areas such as infrastructural development, education, minimum wage, high tax on luxury

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Items, harsh penalties for offenders and better auditing and accountability.

The drawback –The drawback –

1.It facilitates some level of development but it is not holistic;

2. Produces antaganism

Distribution of WealthBetween workers and managers and owners;

3.Fosters alienation, which can lead to revolution if not addressed.

NB: They enjoy very little of the country’s wealth; yet they must pay taxes like GCT. The most vulnerable become hopeless as they have no stake in the economic wealth of the country and they are without a leader to speak for them.

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Changing Class BoundariesIf within societies there are no avenues or scope for social mobility, then this can lead to antagonism as people will see themselves as inferior or less important than those who occupy higher status. A rigid class structure breeds insecurity or mistrust and this can have a negative impact on development. Some avenue for upward social mobility must exist to reward people who are industrious, visionary and productive.

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Natural and man-made disastersCaribbean countries suffer frequently

from natural disaster such as earthquakes, hurricanes and volcanoes. These natural disasters have contributed tremendously to financial burdens as a result of damage to property, infrastructural damage, economic setbacks (especially in agrculture and tourism). The result has been that regional government have had to change developmental plans to deal with short-term or immediate situations.

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Impact of Productive SectorEmployment is generated;

Reduces dependency on imports;

Distributive sector develops;

Increased foreign exchange earnings;

Increase in exports

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Standard of living increases.

Tourism: challengesIn Caribbean territories, where sufficient indigenous people live, there is the challenge of encroachment. In an effort to develop tourism, the culture of the indigenous people are being affected – their knowledge, technologies, religions, social structures etc.

Employment is seasonal and fickle; growth is heavily dependent on what happens in the developed countries (employment is NOT secure; foreign exchange earnings fluctuate);

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Tourism: challengesPotential to harm our environment – pollution, waste management, destruction of ecosystem etc;

Repatriation of profits to the metropolis;

Creation of plantation system – benefit the hotel sector and not the general populace.

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Smallness of sizeExcept for Guyana and Belize, CARICOM countries are relatively small and mountainous. The result is high population densities which leads to:

Scarcity of agricultural lands for food production;

Heavy reliance on imported food;

Traffic congestion;

Pollution;

Slum development

Negative social conditions

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FragmentationThe Caribbean is highly fragmented. The countries are spread out:

Belize in the west

Guyana in the south

Barbados in the east

The result: restricted communication, prevention of free movement of people , constraints on cost of moving resources and goods.

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Resource endowmentAbsence of mineral; forestry and other resources in most territories.

This has placed some limitation on development strategies and options. Except for Jamaica, Guyana, Trinidad and Belize, a lack of resource prevents production and resources available to all allows for production of the same products, hence difficulty in finding markets.

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Proximity to United StatesThis allow for easy penetration of North American culture and lifestyle – cultural imperialism.

This is detrimental as it stifles local and regional initiative and introduces unwanted social habits.

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Regional Economic ProblemsHigh unemployment due largely to an untrained population

Inability to attract foreign investments by some Caribbean countries;

Insufficient number of local businesses

Inadequate supply of foreign exchange

Overpopulation (which puts pressure on the limited social services sector)

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FACTORS THAT PROMOTE OR HINDER DEVELOPMENT

Indicators of Economic Development

This refers to the various factors that are used as means of determining whether a country is a developed or a developing country. These indicators fall into two broad categories, namely:

(a)Economic factors

(b)Non-economic factors

Concepts of Development

Development – refers to the sustained level of economic and social well being in a country.

Sustainable development – refers to the concept of advancing a people’s quality of life, in terms of economic criteria as well as human dynamics, particularly the conservation and protection of the environment.

THE


INDICATORS OF

ECONOMICDEVELOPMENT

Levels ofInvestment

Levels of Infrastructure

EconomicIndicators

Productivity

Employment SustainabilityPer Capita

Income

Social Indicators

Factors that promote or hinder development

Education

Transcript of Factors that promote or hinder development