Economic Challenges in the Twenty‑First Century 339Economic Challenges in the
Twenty‑First Century
International Development
The end of colonialization following the end of World War II and through the mid-
1960s led not only to the geopo liti cal competition between the United States and the
Soviet Union (as Chapter 2 discusses) but also to the emergence of newly in de pen dent
states who were poor, lacking the material resources and expertise to deliver economic
goods to their citizens. Very quickly, international programs developed to begin to meet
the needs of these states. These included the UN’s Expanded Programme of Technical
Assistance, which in the 1950s became the primary UN development agency, the
regional commissions, and other programs pushed by the co ali tion of the South or the
Group of 77 developing countries, as explained in Chapter 7. And the World Bank’s
affiliates, the International Finance Corporation and the International Development
Association, as discussed earlier, were designed to address the issues of the developing
world. GATT itself adopted the idea of more favorable treatment for developing coun-
tries. Even the Doha Round of trade negotiation was labeled a “development” round,
although, as one cynic put it, the round “has not filled any bellies.”^11
Despite these efforts, the most developed countries, largely in the North, average
$40,046 gross national income (GNI) per capita and still bask in relative wealth, with
high consumption habits, high levels of education and health ser vices, and social- welfare
safety nets. In contrast, the least developed countries, mainly in the South, still strug gle
to meet basic caloric needs, with poor educational and health ser vices and no welfare nets
to meet the needs of the poorest of the poor, averaging only $2,904 GNI per capita.
The Human Development Index (HDI) in Table 9.1 shows these stark contrasts across
several indicators. Caused by many factors— colonialism, earlier industrialization of
Eu rope, geography, poor government policies, unaccountable governments— this is the
development gap, or for the poorest, the development trap.^12 In actuality, the divisions
between the poor and the rich have become more complex since the 1990s. As exempli-
fied during the Doha Round, the G7 major economic powers are faced by both the
BRICS (Brazil, Rus sia, India, China, and South Africa) and Group of 20 collective of
emerging powers, which includes the G7, the BRICS, and Australia, Mexico, South
Korea, Turkey, Argentina, Indonesia, and Saudi Arabia.
S TraTEgiES To aChiEvE EConomiC DEvElopmEnT
Ideas about how development occurs have evolved from the work of state policy makers,
officials within the UN system, and analysts within such institutions as the World