Why Developing Countries Run Short of the Capital They Need

Part 1

In most circumstances, developing countries run short of the capital they require to build as well as maintain their infrastructure. As foreign investors, contributors and other stakeholders undertake development activities, there are bound to be environmental destruction due to the inability of the host country to put in place stable infrastructure that helps to curb environmental destruction. Besides this, most developing countries have had an issue to improve the systems that their colonial governments left behind. As development activities get more significant, such systems may not be stable enough to control byproduct that may come about as a result of such undertakings. Also, many developing nations are in the process of formulating as well as strengthening laws that ensure environmental protection. Before the enhancement of such laws to the level that they are implemented to curb destruction to a large extent, there is a high likelihood that environmental damage will be witnessed to a large extent.

Part 2

One of the most significant problems with the way foreign aid is allocated by lending entities is that to those lend to, it has created a situation of dependency, derailing their efforts to strive to be self-sufficient. This has led to a situation in which without foreign aid being allocated in the same manner or given proportions, the target countries are unlikely to achieve their financial related objectives. To ensure that food, medical as well as financial essentials reaches the poor, there are a few requirements that should be stipulated by the firms dispensing such aid.

• The firms offering aid should ensure that countries that such assistance reaches come up with a comprehensive report addressing how the resources above have been utilized among the minority and the poor.

• While requesting for such foreign help, such countries should be required to document how they are to distribute such resources to the poor. They should also provide the necessary proof.

• The institutions providing such aid should require the target country to dispense such resources to the poor in certain proportions. Without such stipulations being reached, the countries in question should be denied the aid.