Financing Gap And Economic Development

Introduction to the Financial System Financial Instruments Financial instruments can be: • Equity This is usually through the selling of common shares and/or common stock. It gives the buyer some ownership of the firm and thus, voting power when it comes to electing the board of directors. Debt This is money that is borrowed from someone else. Debt must be repaid at set intervals. Debt can be divided into short and long-term debt. This should follow the matching principle where short-term assets should be funded with short-term debt.

Project financing: Despite the new project not having to invest in capital equipment for set amount; it is clear that due to the present amount of cash flow for the

Economic development can be defined generally as involving an improvement in economic welfare, measured using a variety of indices, such as the Human Development Index (HDI). A developing country is described as a nation with a lower standard of living, underdeveloped industrial base, and a low HDI relative to other countries. There are several factors which may have the effect of limiting economic development in such countries. Factors such as these include: primary product dependency, the savings gap and political instability.

Investing in the community is an excellent way to give back to the people that have helped to make your business grow, also; most donations are tax deductable. Helping out the community can also raise your business’s profile and help your business’s name become better known.

Ms. Chen 's department focuses on building multilateral investment collaboratives comprised of private and public sector entities. She relies on her individual relational capital to build these cooperative networks, which span across organizational, regional, and international boundaries, and draws on the structural capital of PWC and her clients in support of a unified effort to provide low income populations with financial tools that bolster their access to basic financial services, which improves their participation and competitiveness in Global markets.

Invest in community: Local businesses are owned by people who live in this community, are less likely to leave, and are more invested in the community’s future.

I would define the opportunity gap as the unequal distribution of input towards a person’s success.

Civic entrepreneurs are helping communities cooperate to compete in the information age coming from all experiences of life and a new gener¬ation of leaders who forge new, powerfully productive connections at the center of business, government, education, and community. These entrepreneurs have much to teach us about building vital and strong economic communities in raging times and in the process, restoring civil so¬ciety from the very roots. They help communities to collaborate, organize and develop their economic assets and to build productive, tough relationships across the public, private, and civil divisions that misrepresent the ties that bind economy and community for their shared benefits. The provision of the continuity of work on tough issues and continue working overtime is a trait of a civic entrepreneur.

• Economic development in the community is promoted by providing access to small, woman-owned and minority- owned business

How does the government manage the above, constructing schools to have a more prepared population, promulgating laws that promote the investment to be able to generate more and better work places and, finally, developing infrastructure that allow to advance towards the achievement of the targets, like highways, energy sufficiency, etc. And for this the government needs money.

The Community Investment is implemented through investments injected into local organizations, certain programs and partnerships, which contribute towards connecting people and inspiring positive and substantial changes. The Diversity and Inclusion is achieved through cultivating a diverse and inclusive workforce, which is based on the principle of Ralph Robert?s goal, where

A potential problem associated with this type of government interaction is minimal and outcome is almost always socially efficient. However, in the case of developing country, government might not be able to invest in infrastructure because of the scarce capital available. Generally, governments of developing countries are always in search of capital and their decision making process greatly varies from the ones of the rich countries.

Schaffer, in defining the concept, noted that “development administration is about programs, policies and projects in which there are unusually wide and new demands and in which there are peculiarly low capacities and severe obstacles in meeting them”. Schaffer’s

• • • • • Conclusion An Overview of the Planning and Development Process An Analysis of the Institutional Weaknesses in the Planning and Development Process Recommendations for Improving Economic Performance in Development Programmes A Model for an Integrated Project Management System

Financial intermediaries provide a number of functions. The first of which is known as size transformation. A financial intermediary is able to borrow to an economic agent with a deficit of funds the amount they require without the need to find a lender that is willing to invest the exact amount required by the borrower. Without financial intermediaries, it would be extremely difficult for a borrower to raise capital as lenders would have to pool their funds together in order to lend the borrower the amount they require. Another function of financial intermediaries is maturity transformation. Economic agents with surplus funds usually prefer investing their money in short-term projects, whereas borrowers require more long-term financing. Financial intermediaries offer an optimal solution, without which borrowers and lenders would be in disagreement over the terms of the transfer of funds. Financial intermediaries also provide risk transformation. Economic agents with surplus funds are usually very risk conscious when it comes to investment, but borrowers however may require the finance for a more risky project, that may be more profitable. Financial intermediaries are willing to take risks that borrowers usually would not. However, there is usually a compensation agreement so as to avoid