external influence in the making of development ... - FES Ethiopia

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2. The Current Global Context Development cooperation takes various forms: financial or technical support for projects and programs, provision of capital or infrastructural goods or credit on easier terms. Humanitarian aid is the aspect of development cooperation directed towards bringing speedy relief during emergencies, such as those caused by natural disasters or war. Different milestones that guided development cooperation include: - • Colonization ties • Oil-price shock • Cold War period • Natural disasters • Concern over the Environment • Concern over human right, absolute poverty • Fight against terrorism • Globalization 2.1 Recent/ New Features This section attempts to analyze recent and new features that are influencing external aid and development cooperation. Some of the key features that have occurred beginning with the new millennium include: 1. Increased open talk at WB/ IMF of the failure so far 2. The PRSP initiative 3. The MDG goals 4. Emphasis on Good Governance and Democracy 5. Emphasis on free trade and flow of capital 6. Declining development aid 7. Growing demand for financing global goals 8. Gaps in economic theory and modeling of current epoch Here, only selected issues will be discussed to highlight the pressure that exists on less developed countries in the face of global competition that has no fair ground and level playing field. This is underlined by a growing discrepancy between declining development aid and the simultaneous growth in demand for financing of global social and development policy objectives. Efforts have stepped up, therefore, to look for new sources of finance, new mode of resource channeling and identification of international priority areas. Key global challenges identified include environmental protection, poverty reduction, promotion of free trade, peace and security, and the stabilization of capital markets by new global means. Probably as a reflection of this, political support for conventional aid is declining worldwide, except by Japan. The majority of industrialized countries have continued to cut their development aid budgets in spite harsh criticism they are facing. According to 8
WIDER (2004), total official development assistance (ODA) to sub-Saharan Africa trended downward from the early 1990s. It fell substantially in the mid-199s, falling from $16.9 billion in 1994 to 11.6 billion in 1999 and the region has received $1.4 billion less of aid during 1993 to 2002 than during 1983 to 1992. Globalization In the previous era, two superpowers competed politically, economically, militarily, and ideologically across a worldwide landscape. A new aspect of global trend after the end of the Cold War period is the globalization process which initially promised peaceful relationships based on market economics, free trade, instantaneous telecommunications, and the liberal movement of financial capital across national borders. Globalisation means that capital and jobs; pollution, crime and terrorism; people, ideas and values, all move increasingly across national borders in response to changing patterns of incentives and disincentives. What happens in one country does have an influence over what happens in another, and the aggregate effect of national actions may make all worse off in the long term - a classic example being the progressive degradation of the "global commons" as a result of unsustainable use of natural resources(Source to be indicated). Hence, the globalization process has also a non-economic side that is reflected in terms of extra-territorial pollution, extravagant culture, exodus of talented people, trade in drugs, criminal and other security threats, and new diseases. Some of these, of course, will have eventual economic implications in the long-term. The implications of globalization are many including fierce competition, increased inequality, erosion of national sovereign power, and cultural invasion. The process is likely, therefore, to put additional pressure on national policy making process. Globalisation is good news for economies, firms and workers who are internationally competitive, but not so good news for those who fall behind; as in any liberalised market, the disciplines imposed on poor performers are severe. Given the extreme differences which exist between rich and poor countries in the "starting conditions" which have such an influence over competitiveness, globalisation is likely to exacerbate existing global inequalities unless conscious action is taken to address these differences. Efforts to "catch up" with industrialised countries in terms of competitiveness may also result in falling labour and environmental standards as firms cut costs, thereby resulting in increased environmental degradation, social exclusion, and economic exploitation in industrialising countries (source to be indicated). What is most unacceptable is the double standard and rigged rules that are punitively targeted at developing countries. Countries like Ethiopia are not only isolated and marginalized but are also unfairly targeted to loose and further slide down to underdevelopment. For example, rich countries spend a billion dollars a day to heavily protect their own markets so that exports from the poorest countries cannot come in. In addition, these countries charge high import duties so goods from abroad are much more 9
Page 1 and 2: EXTERNAL INFLUENCE IN THE MAKING OF
Page 3 and 4: Hence, developing countries are dou
Page 5 and 6: other goals may include advancing t
Page 7: Since 1991, Ethiopia mainly followe
Page 11 and 12: The end of the Cold War removed the
Page 13 and 14: Aid (grant) Data on aid flows is in
Page 15 and 16: FDI flow to Ethiopia Year FDI Inflo
Page 17 and 18: 4. Ethiopia's Dependence on Aid Eth
Page 19 and 20: Source of Aid Ethiopia receives a f
Page 21 and 22: Dependence on Aid could stifle inte
Page 23 and 24: Aid conditionalities Aid is expecte
Page 25 and 26: South conflict, but a fundamental s
Page 27 and 28: such as the World Bank and Internat
Page 29 and 30: higher, plateau level. The large in
Page 31 and 32: Conclusion Ethiopia has been quite
Page 33: References Abebe Taddesse, (2004):

external influence in the making of development ... - FES Ethiopia

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