The Impact Of Transnational Industries And Global Financial Institutions Such As The World Bank And International Monetary Fund

International development and underdevelopment are major issues in global society today. John Perkins’ book The New Confessions of an Economic Hit Man is a very critical account on the activities of private corporations such as MAIN and international financial institutions such as the World Bank and the International Monetary Fund and how many actions are based on self-interest, corruption and greed. The book does an exceptional job at giving us an insider’s perspective on why debt induced developing nations are in a constant state of underdevelopment from the corrupt actions of Economic Hit Men and their colleagues Jackals who deal with the dirty side of the business and political economics. Global economics and debt have

Djibouti has few natural resources and little industry; therefore, it is heavily dependent on foreign assistance to help support its balance of payments and to finance development projects. (“The World Factbook,” 2011). The

Sub-Saharan economy has improved overall, but the region is still struggling with their economic performance. Prolonged colonization has left the region with weak institutions. Personal rule policy that is based on personal relationships and favors, has also contributed for the prevalence of weak institutions. The rules are applied selectively and depends on the connections one has. The wealth of the state belongs also to the head of the state and those closest to him (Moss 2011, p. 40). Furthermore, the enclave economy does not depend on development or production since it is based on resource exports and accumulation of wealth for the elites. Leonard and Straus argue that enclave economies discourage evolution of the institutions due to lack of incentives, and are the basis for personal rule (Leonard and Straus 2003, p. 13, 17).

In today’s society a lot of developing countries rely on assistance from the international lending institutions to help with funding. Africa receives about 22 percent of assistance from the World Bank. The World Bank is the main source of lending to this underdeveloped country.

The World Bank (WB or Bank) has transformed from serving primarily to reconstruct post WWII Europe to the world’s largest external funder of health due to the globalization movement. To the global South, the Bank will primarily be known by its controversial Structural Adjustment Programs (SAPs). This essay will examine the effects of increased privatization of health care in Africa as a result of loan conditionalities imposed by the Bank SAPs. Effects of SAPs on health and social determinants of health in African countries will be examined with the support of empirical data, followed by a possible explanation for lack of response from the Bank. An outline of existing and proposed alternative solutions will also be evaluated.

African perspectives, provide political, social, and economic context and cultural experiences that are crucial to IR theory. Specifically, African perspectives focus on the importance of contextual and cultural differences between Africa and the rest of the world to enrich IR theory. The African context is dominated by diversity yet it is still marginalized from core IR theory. The contextual differences between the political, social, and economic environments between Africa and the world have distinct implications for “the practice and study of international relations.” (Smith 272). One of the chief contextual differences is the distinction of states in Africa being states solely in name. The state-centrism of western IR theory is thus not acknowledged in African perspectives as states are not considered the main focus. This retreat from state

Modenisation impoverished Africa through colonialism and imperialism by the Western nations and this tendency is with us today as the East nations takes shot to deplete the Africa’s natural resources such as oil and minerals (Matunhu, 2011). As far as Africa would like to outgrow poverty and underdevelopment, this however may be not possible if we still strongly believe in the power and strength of modernity. Combatting Africa’s poverty and underdevelopment includes more than a simple disarticulation of the traditional society (Matunhu, 2011). Given facts that currently China is one of the largest trade partners with Africa, this results that China’s only interest is to exploit Africa’s natural resources ahead of Europe and America. The surplus economic value that is extracted by Chinese capital may be externalized in the form of profit allowance back home and some it could be spent on noticeable consumption (Matunhu, 2011). The theory does not reflect all these factors which drive the economy of a country up to being modernized. Developed countries create modernity through exploitation of the disadvantaged. The core countries exploit the poor periphery countries (Wallerstein,

The three major international economic institutions are the International Monetary Fund (IMF), the World Bank and the World Trade Organization; this book mainly focuses on the IMF and the World Bank, due to the author’s first-hand experience with both institutions. The IMF, a public institution built as a guiding hand for economic stability around the world, has brought false

Lack of development in countries in the so-called `Third World' has many political and economical reasons. Historians explain the inadequacy of developing countries with the early imperialism and the resulting colonization of the South. Exploitation of mineral resources, deforestation, slavery, and the adaptation of foreign policies shaped the picture of today's suffering and struggling civilizations and natural rich continents. The omission of concessions and equal negotiations between dependency and supremacy give rise to the contrast of enormous resources and immense poverty in developing countries is. In the last years the outcry of justice and the emancipation of the Third World became louder throughout developing and industrialized

Whether African countries have benefited from IMF/World Bank projects is a subject of controversy. Rono, J. K. (2002) opines that adjustment programs have caused de-legitimization of state which has led to political violence, riots and frequent regime changes in some countries in sub-Saharan Africa such as DRC, Zambia and Nigeria. For purposes of this research, I will restrict myself to discussing what is known as the structural adjustment program popularly (SAPs) in Kenya. According to Rono, J. K. (2002) Kenya adopted economic reforms mainly with the aim of achieving macroeconomic and structural adjustment which were initiated by the World Bank and the IMF in from 1980 onwards.

Our world is steadily shrinking. Technology is building bridges over the barriers of distance, language, and culture. It’s a process called globalization, and it is changing the way we live. Financial institutions haven’t been immune to the effects of this change. In fact, the international nature of financial institutions makes them particularly vulnerable to change. This paper addresses three issues caused by the globalization of the international monetary community.

2. A project of the IMF that created problems for Africa after they received it?

In the year of 1327, Kind Edward III of England defaulted on his Italian debts. This caused the banks of Bardi and Peruzzi in Florence to collapse. Who would know that over 650 years later, the world would still have these types of problems? After World War II, the need for an organization like the IMF was finally realized. After the war, politicians and economists began to work on blue prints for a postwar world. They envisioned a liberal international economic order, based on stable world currencies and revived world trade. The International Monetary Fund (IMF) finally came into existence on December 27, 1945. On this date, twenty-nine

Under 150 days stay before the Third International Conference on Financing for Development (FfD) happens in Addis Ababa. The African improvement financing connection has absolutely changed subsequent to the two past comparative social event in Monterrey in 2002 and in Doha in 2008: For instance, private capital streams, for the most part as remote direct speculation, and settlements have now overwhelmed official advancement help (ODA). Thus, China and alternate BRICS nations have firmly expanded their vicinity in the landmass.

The declaration that African development is hindered by internal and external factors is a challenged issue. To a greater extent, one may agree to this perception that Africa does not occupy an important position in terms of global geopolitics. However, this cannot be the only factor explaining Africa’s underdevelopment. Other factors such as many African countries being landlocked, poverty, weak regional integration, agricultural immobility, inadequate trade links, poor infrastructure, external influences, political instability and civil wars have shattered Africa’s development. This essay will therefore define ‘world system’ and assess how some of the above factors have internally and externally contributed to hinder Africa’s growth