International Finance Institutions (IFI’S) . Market Economy: -an economy in which government regulations are reduced to a minimum and businesses are free to make their own decisions .
Market Economy: -an economy in which government regulations are reduced to a minimum and businesses are free to make their own decisions
Neo-Colonization: post independence. US styled “development” became a means of continued colonization of the south by control of financial institutions
Trade liberalization: a process that involves countries in reducing or removing trade barriers, such as tariffs and quotas, so that goods and services can move around the world more freely
Head of the bank is appointed by the US. Government
Owned by the governments of its members, which provide its funds
To lend money to help war torn countries
Speed up economic progress and industrialization
Help countries develop their natural resources
To negotiate long term loans to increase productivity in countries
To increase growth and reduce poverty in developing countries
To fund specific infrastructure projects
Head of the IMF is nominated by the European Union
Funded by members countries, countries that contribute more money have more votes
To set dependable international rates for world currencies
To establish international economic stability and promote foreign trade
To provide emergency short term loans to countries
To demand reforms in a country to promote good governance and get rid of corruption
Free trade: when two countries agree to eliminate all tariffs and taxes on goods and services between two countries.
NAFTA: North American Treaty Organization: largest free trade zone in the world. Goods/Services can move between all three countries without being taxed
European Union: liberalized trading area, plus mutual currency, border protection, and even a European Parliament
-created in 1995 to increase world trade
-main goal is to lower trade barriers between countries
Resolves trade disputes between countries
Can force countries to pay fines or uses sanctions
Sanction: a penalty. Often an economic penalty, taken to pressure a government to agree to carry out certain actions to receive specific benefits
WTO has too much power. It can force countries to change their laws and regulations to make them fit WTO rules.
WTO is not democratically accountable. Hearings on trade disputes are closed to the public
WTO does not care enough about the problems of developing countries. It has not forced rich countries to fully open their markets to products from the developing countries.
The WTO has not done enough about the environment, child labour, workers rights or health care.