1. Chapter 5: The Global South in a World of Powers

2. Copyright 2010 Cengage Learning Some Definitions Global South: Less-developed countries Global North: Wealthy industrialized countries Third World: Cold War term for Global South First World: Cold War term for Global North democracies Second World: Cold War term for Soviet Union and other communist countries Fourth World: Indigenous peoples 2

3. Copyright 2010 Cengage Learning Global South 3 85% of the World’s People 20% of the world’s wealth

4. Copyright 2010 Cengage Learning The Global North, Global South (and Global East) 4

5. Copyright 2010 Cengage Learning The Great North–South Divide in Wealth and Population 5

6. Copyright 2010 Cengage Learning Imperialism Late 1400s: Europe used transportation and military technology to conquer colonies Mercantilism: Trade should increase state wealth; increase exports, decrease imports; used to take advantage of colonies 1880s: Final burst colonizes most of Africa China divided into spheres of influence 6

7. Copyright 2010 Cengage Learning European Control of the Globe 7

8. Copyright 2010 Cengage Learning Global Imperialism 1914 8

9. Copyright 2010 Cengage Learning Economic Explanations for Imperialism Marxism–Leninism: Capitalists need overseas outlets for surplus capital Liberalism: Result of maladjustments within the capitalist system World-system theory: Capitalist core and dependent periphery 9

10. Copyright 2010 Cengage Learning Political Explanations for Imperialism Hobson: Competition for power and prestige among European states Realpolitik 10

11. Copyright 2010 Cengage Learning Imperialism Declines: 20th Century Self-determination: Woodrow Wilson, Treaty of Versailles League of Nations mandates World War II saps strength of colonial powers, demonstrates that colonial powers can be defeated Decolonization from 1947–1960s Neocolonialism: Continued domination of the Global South by the Global North through economic means 11

12. Copyright 2010 Cengage Learning Global North Democratic Technologically inventive Wealthy Aging populations Low population growth 12

13. Copyright 2010 Cengage Learning Global South Most states: Not democratic Low technology use Poor Rapid population growth Overstrained social and ecological systems 80 percent global population 15 percent global wealth 13

14. Copyright 2010 Cengage Learning Poverty 14

15. Copyright 2010 Cengage Learning How Do We Measure Poverty? Per capita GDP Purchasing Power Parity Basic Human Needs Approach Human Development Index (HDI) Inequality Gini Coefficient Gender Development Index 15

16. Copyright 2010 Cengage Learning Gini Coefficients of Various Countries 16

17. Copyright 2010 Cengage Learning Percentage of People Living on Less Than $1 a DayUN Development Goals for 2015 17

18. Copyright 2010 Cengage Learning The Problem of Late Development First Mover Advantages Economies of scale Network effects Investment funds Declining Terms of Trade 18

19. Copyright 2010 Cengage Learning Strategies for Development Today Import-substitution industrialization State socialism Export led growth 19

20. Copyright 2010 Cengage Learning The Asian Tigers South Korea, Taiwan, Singapore, and Hong Kong used export-led growth to move from the world’s poorest countries to the world’s richest in half a century “Go where the money is.” Low cost production based on abundant cheap labor Use profits and expertise gained to move up the food chain 20

21. Copyright 2010 Cengage Learning World Bank and Foreign Aid 1968–1981: Focus on basic human needs approach 1980s and 1990s: Focus on structural adjustment Recently, focus on good governance 21

22. Copyright 2010 Cengage Learning Shortcomings of International Aid Goes primarily to governments Multiplier effect of aid Tied aid 22

23. Copyright 2010 Cengage Learning Multilateral Aid and the World Bank Structure of the World Bank: The U.S. has 16.4 percent of the votes, followed by Japan with 7.9 percent, Germany with 4.5 percent and France and Britain with 4.3 percent each. 163 other members have less than one percent of the vote. 23

24. Copyright 2010 Cengage Learning Some Critiques of the World Bank The voting procedure disenfranchises the poor countries that have the most at stake Lending may leave the recipient with debts, without much benefit Conditionality undermines the sovereignty of recipient governments Conditions often require harsh economic policies 24

25. Copyright 2010 Cengage Learning Bilateral Foreign Aid 25

26. Copyright 2010 Cengage Learning Modernization Theory Reasons for underdevelopment are internal deficiencies Global South must: Create conditions for efficient production, free enterprise, and free trade Attract investment capital from the Global North Pass through stages of development and reach “take off” Historical conditions that allowed the North to do this in the 19th century do not exist now 26

27. Copyright 2010 Cengage Learning Dependency Theory Reasons for underdevelopment are external Capitalist world economy is based on a division of labor between the industrialized core and underdeveloped periphery Global North keeps Global South poor through: Terms of trade and finance Exploitation by multinational corporations Dualism—rural impoverished sector and urban modernizing sector Has trouble explaining the NICs 27

28. Copyright 2010 Cengage Learning The Global South’s Search for Power Nonaligned Movement Failed states External military intervention Arms acquisitions Preparing for natural disasters 28

29. Copyright 2010 Cengage Learning The Global South’s Search for Prosperity (1 of 3) Import-substitution industrialization Export-led industrialization New International Economic Order (1974) Pushed by Group of 77 Called for changes in the international economic system that would benefit development in the Global South and redistribute some global wealth to it Most were rejected by the Global North 29

30. Copyright 2010 Cengage Learning The Global South’s Search for Prosperity (2 of 3) Regional trade regimes: NAFTA: North American Free Trade Agreement Mercosur: Argentina, Brazil, Paraguay, Uruguay APEC: Asia-Pacific Economic Cooperation ASEAN: Association of Southeast Asian Nations SADC: Southern African Development Community 30

31. Copyright 2010 Cengage Learning The Global South’s Search for Prosperity (3 of 3) Trade, Aid, Investment, Debt Relief Bilateral aid: official development assistance Multilateral aid: World Bank Conditionality Foreign direct investment (FDI) Multinational corporations (MNCs) Heavily indebted poor countries (HIPCs) 31

32. Copyright 2010 Cengage Learning The Washington Consensus Free market approach is optimal Other approaches: Developmental state The Post-Communist Experience Emerging Consensus: Embraces both the developmental state and the free market 32

33. Copyright 2010 Cengage Learning Two Rankings of Global North Countries’ Aid to the Global South 33

34. Copyright 2010 Cengage Learning Trends in Capital Investments in the Global South 34