The effect of the financial crisis on the third world
The financial crisis has affected the world in many ways. In the U.S., the hardest hit industries are the banking, real estate, and construction industries.
With millions of foreclosed homes and no one to buy them, the U.S. Government proceeded to fund a huge bailout to save the economy from collapsing. It was the largest financial crisis in many years and the biggest recession since the Great Depression.
Many other countries aren affected but you typically only hear about large countries. You rarely hear about the effect this has had on small and third world countries.
In third world countries, obviously there are much larger problems than simply needing to get a bailout to save people from losing their jobs or homes. The poverty is on a much larger scale than most large and wealthier countries could ever imagine. However, there has been some effect on third world countries that are a direct result of the financial crisis.
One of the largest effects is obviously less funding from other countries for some of their important needs. There has been less donated for health care and food aid than there typically is. This can cause a large and negative impact on the third world countries because they count on receiving this aid to help curb hunger and disease. It is truly awful that this has happened.
There is also an impact on the global trading market that has affected third world countries. Some countries have seen a decline in their income from this. The prices of certain items have gone down and thus have hit the small pocketbooks of already poor countries. Countries that diversified their trades have a large cushion and have not been hit as hard. However ,some third world countries did not have that luxury and have been affected economically by this loss of income.
Investment in third world countries from banks and governments has also declined. This obviously affects the economies of the third world countries because that means less jobs to be given and less money to invest in the economy and business.
Not all third world countries have been as affected as others. It depends on a variety of factors.However, overall growth in business and investment has taken a huge hit in third world countries. This is obviously a fall back from the financial crisis. It looks like every country has been hit in some way, whether it be large hits or smaller ones. Hopefully, as things get brighter, the economies of third world countries will be rejuvenated by investments from larger and wealthier countries. Also, donations should go back up and help will be more readily available. The micro credit industry has still been working even during this time and has helped third world countries bring some of its residents out of poverty. This is the effect the financial crisis has had on third world countries.