aid vs trade

Aid vs Trade 20130078

The aid verses trade debate shows the strong difference and sizable reduction in severe poverty in emerging economies such as China, Thailand and South Korea that have embraced international trade, with the persistent poverty in many aid-dependent African countries. The debate of whether foreign aid is beneficial or harmful to a country in need can be seen as foreign aid directed to Africa has significantly grown yet this has not benefited the continent as it is still considered 'developing' and is in a state of widespread poverty (Alesina, Dollar, 2000). Asia, which was once also considered a third world country has developed a strong economy and infrastructure with not aid that, was introduced in Africa. Rather than seeing the two arguments as aid or trade, it should be seen as aid for trade. (Rotberg, 2009)

Trade has a significant long-term affect on the developing countries economy; it is the key to development.

World map showing percent of population living on ...

Newly Industrialized Country

Developing 8 Countries

It allows the country to develop strong trading relationships with other countries, thus allowing a regular flow of funds into the developing country. Trade is necessary as it allows the country to use its own natural resources, which not only benefits themselves but also the world of trade. Africa has been given in the past 60 years at least $1 trillion of development-related aid; even with this huge influx of economy the income today is lower than it was in the 1970s, and more than 50% of the population live on less than one dollar a day and still remains in a major state of poverty (Moyo, 2009)

Aid is beneficial for developing countries going through a period of unsteadiness and have gone through a major crisis e.g. natural disaster, this is when aid is most needed, as a country is left...