Undecided Research Paper Example | Topics and Well Written Essays - 2000 words

Undecided - Research Paper Example The most vulnerable States were the third world countries;this is because they survived on loans, to bridge the deficits in their budget allocations. They also applied for these loans for purposes of initiating development activities within their states. On this note, the two Bretton woods institutions attached these conditions to ensure that the money lent, will carry out intended purposes2. The conditions were imposed for purposes of reducing the borrowing trends of the third world countries, and they were aimed at opening up their markets for purposes of trade, and thus a nation could generate sufficient resources to take care of its budget. On this note, the main aim of the policies was to force a state to open up their economies, and concentrate on trade. They advocated for the removal of trade barriers, and the privatization of the various government parastatals3. On this note, this paper examines the notion that the structural adjustments policies helped in the growth of the t hird world countries. ... tself and determine its own affairs.4 Other scholars argue that the structural adjustments policies were aimed at opening up the economies of third world countries, in order to allow well established companies, a presence in their economies. This in turn will lead to unfavorable balance of trade between the third world country, and the country in which the multinational company comes from. These scholars argue that at the time, third world countries did not have companies that had the capability of competing with these huge companies from Europe and United States of America. These companies controlled numerous resources, including financial and technological resources. On this note, companies operating in Africa, and Asia could not match them in terms of skills, and the resources. These Multinational companies enjoyed economic advantage, and therefore they would make huge profits in these economies, and plough them back into their mother countries, instead of investing a portion of t heir profits in the host country. On this note, this paper examines whether the structural adjustments policies contributed to the decline of the economies of third world countries. Synthesis: There are many arguments for and against liberalization of an economies state. One of the arguments supporting the opening up of a countries’ economy is that it would lead to the growth of the nation’s GDP. Take for instance Brazil, China and India, these three are the world’s fastest growing economies, and this is because they took measures to liberalize their economies, allowing competition, and little government regulation in their sectors. It also needs to an exchange of the much needed foreign exchange, which is beneficial to a nation’s GDP, and for International trade5. Take India for