Aid and the Development of the Third World
DEVELOPMENT IDEOLOGY is seen as a response to economic needs and crises in the period of time in which it evolves. Western industrial development working with a laissezfaire economic outlook, which had already been generated with the demise of feudalism and the release of the sociological base needed for the advent of 'economic man', proceeded as a self-generating force. Development gathered momentum, fanned by technological innovations of the Industrial Revolution and accelerated by the back-up of financial institutions and simultaneous developments in transport, further strengthened by the opening up of overseas colonial territories to serve the needs of development.
The socialist strategy typified by the Soviet Union's response to development after 1917 was a markedly self-generated response worked out under a tightly planned economic framework of a centralised capital-intensive industrial base, which provided it with the ground work for the economic "take-off" after the Russian revolution.
Development aid to the Third World, in contrast to development ideologies of the past, has grown as a hand-out from the Western world to the developing world and does not generate a self-propelled development process. Hence, an analysis of the historical evolution of the idea of development aid, the motives behind such hand-outs bearing in mind the world economic climate within which aid continues to be granted, and illustrative experiences of typical recipients of aid would be instructive in an assessment of the Third W^rld in the contrasting responses to development worked out after decolonisation.
The twin institutions—the IMF and the World Bank—the prime aid-givers of today were conceived in an era when more than two-thirds of the Third World were non-existent, and were therefore not framed with Third World objectives in mind. It was only Latin America that then constituted what is now known as the Third World. The world had gone off the Gold Standard in 1939. Britain had lost her primacy in world trade and investment, and was being- replaced by the U.S. as the foremost international power. The Great Depression of 1930 had strained the international monetary mechanism. Nation-states in Europe were adjusting to the new economic policies of Welfare Economics with their emphasis on minimum
* Economist 1 i^< < in Folomho, Sriht K.I