FACTORS LEADING TO THE INCREASE IN THE GAP BETWEEN RICH AND POOR NATIONS DUE TO GLOBALIZATION

INTERNATIONAL INEQUALITY

Inequality must be defined and be able to be measured so that comparisons can be made between rich and poor countries. Once the causes are determined, the effects of globalization can be evaluated and be measured. The World Bank defines inequality as the disparity of income and standard of living among nations and their citizens (Birdsall, 2002)
The income gap that exists between the rich and poor countries has become substantial. In 2003, the richest fifth of the world’s population received 85% of the total world income, while poorest fifth received just 1.4% of the global income (infoplease, 2005).When the GDP is …show more content…

The deepening of poverty and inequality has implications for the social and political stability, among and within, nations. It is in this context that the plight and hopes of developing countries have to be understood in the Doha Round of trade talks. Having commenced in 2001, the Doha Round was supposed to be about the trade-led and trade-facilitated development of the world's poor countries. After five years of negotiations, the talks collapsed because of unbridgeable differences among the EU, the US, and developing countries led by India, Brazil, and China.

From the developing world's perspective, the problem is that the rich countries want access to poor countries' resources, markets, and labor forces at the lowest possible price. Some rich countries were open to implementing deep cuts in agricultural subsidies, but resisted opening their markets, others wanted the reverse. Developing countries like India, China, and Eritrea, among other things, are determined to protect the livelihood of their farmers. Protecting farmers' needs, therefore, is essential for social stability as well as the political survival of governments in the developing world.

The rich countries' pledges of flexibility failed to translate