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In the recent past, globalization has acquired considerable attention across the globe. Some view it as a process that is beneficiala key to future world economic development that is inevitable and irreversible. Others regard it with hostility, even fear, believing that it increases inequality within and between nations, threatens employment and living standards and thwarts social progress.
The twentieth century saw unparalleled economic growth, with global per capita GDP increasing almost five-fold, which was of remarkable average income growth. As globalization progressed, living conditions improved significantly in virtually all countries. However, the advanced countries benefited more and of course some of the developing countries. It is also quite obvious that the progress was not evenly dispersed. The gaps between rich and poor countries, and rich and poor people within countries, have grown. The income gap between high-income and low-income countries has grown wider and is a matter for concern. The richest quarter of the world's population saw its per capita GDP increase nearly six-fold during the century, while the poorest quarter experienced less than a three-fold increase. It is clear that the income gap between rich and poor countries has been widening for many years. The poor countries that have sound management policies in place can actually raise their national incomes under the impact of globalization.
Foreign aid is crucial to the developing countries, no one develops overnight; but the aid community, starting with the IMF and the World Bank, have put the cart before the horse: they would lend or give assistance before real reforms were achieved. Instead, if they give aid, they should do so after the necessary reforms are undertaken. If these countries spend the aid properly, they could make the achievement of global objectives possible.
In the process of setting international rules of globalization (especially, those related to WTO) the developing and underdeveloped nations have largely been powerless. Is it correct then to jump to the conclusion that globalization has caused the divergence, or that nothing can be done to improve the situation? On the contrary low-income countries have not been able to integrate with the global economy as quickly as others, partly because of their chosen policies and partly because of factors outside their control. The international community should endeavor by strengthening the international financial system, through trade, and through aid to help the poorest countries integrate into the world economy, grow more rapidly, and reduce poverty. To debate the pros and cons of globalization and foreign aid, Analyst invited the following experts: Paul J Bonicelli, Dean of Academic Affairs and Associate Professor Patrick Henry College, Virginia, US; Ariel Cohen, Research Fellow, Institute for International Studies, Washington, US; William Simon, Chair in Political Economy, Center for Strategic and International Studies (CSIS), Washington, US; Professor Martin Richardson, Department of Economics, University of Otago, New Zealand and Professor Patrick M Boarman, National University of San Diego, California, US. |
