Developing countries (NP)

Episode number 10 of Series “The Global Economy”.
The effectiveness of foreign aid to developing countries has become a central concern for economists moving towards the 21st Century. This episode of the Open Learning Economics course debates the long-term goals of foreign aid and argues that a more effective means of ensuring financial development is to encourage developing countries to enter the international market. The first part of the episode examines the history of South Korea, which after the Korean War began to emerge as one of the most powerful economies in the Asian region. The experience of the South Koreans is contrasted with Sri Lanka which, in the 1950s, was the favored south-east Asian country by Western powers in terms of aid grants and economic assistance. However, due to Government inefficiency and the dependance on import substitution, it remains one of Asia’s poorest economies. The last part examines the history of Tanzania, which emerged as a nation in 1964. The large amount of aid granted to this very poor country has not translated into economic success. Using these cases studies, a panel of economists debate alternatives to aid for developing nations.