Information and stories on development news.

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World Bank Risk Management Helps Reduce Poverty

Risk Management World Bank Development Strategy
In its annual World Development Report on October 7, the World Bank stated that successful risk management can be an essential tool for development.

Risk management in development involves policies that can help improve the negative effects of natural disasters, economic shocks or health crises. The World Development Report suggests that poor risk management has resulted in a staggering child mortality rate from injury and illness in low-income countries, one that is nearly 20 times higher than that in high-income countries. These slacking policies have also led to more deaths during droughts in Africa than from any other natural disaster. However, if governments and decision-makers can create more durable environments for managing risks, these trends can indeed be reversed.

“Risk management can save lives, avert economic damages, and can provide resilience and prosperity by allowing people to undertake new endeavors,” said Norman Loayza, director of the 2014 World Development Report.

The World Development Report has been released annual since 1978 and is the World Bank’s most comprehensive publication. As inferred, this year’s report looked at how managing risks can end poverty and increase equity.

As of now, many societies and individuals fail to tackle risk successfully because of lack of resources and information, missing markets and public goods and even more, social exclusion. “We’re advocating a sea change in the way risk is managed,” World Bank President Jim Yong Kim said. “Our new approach calls for individuals and institutions to shift from being ‘crisis fighters’ to proactive and systematic risk managers.”

The report tells us that because most individuals remain ill-equipped to confront many shocks and disasters, they must instead depend on shared action and responsibility. Without coherence from the international community, individuals, states and nations will continually be unable to handle problematic events on their own terms.

– Sonia Aviv

Sources: Global Issues, World Bank, Topix
Photo: World Bank

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10 New Health Innovations for Developing Countries

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The need for new, inexpensive medical innovations in the third world is staggering. These devices must be easy to transport, operate, and most importantly, be affordable, or else they will remain available only to the wealthy. These ten new health care innovations for developing countries will be ready to distribute by 2015 and have the potential to save 1.2 million people.

1. Kit Yamoyo: This medical kit contains anti-diarrheal medicine that is packaged to fit over Coca-Cola bottles.

2. Anti-Shock Garment: The cloth is wrapped around the lower body to alleviate excessive bleeding after childbirth. The garment also prevents blood from leaving the vital organs until the mother can be transported to a healthcare facility.

3. Chlorhexidine: An antiseptic that averts dangerous infections that result from cutting the umbilical cord on a newborn baby.

4. Rotovac: The vaccine prevents rotavirus related diarrhea.

5. The Backpack-PLUS: It provides health workers with the tools to deliver a baby properly.

6. Helping Babies Breathe: Although not technically an invention, the program trains one million “birth attendants” to keep babies breathing after they are born, despite the birthing conditions.

7. Bubble CPAP: This airway device forces oxygen down babies’ lungs to save them from severe respiratory diseases.

8. Phone Oximeter: The mobile phone-based monitoring system is able to report blood oxygen levels for healthcare workers in areas without proper health facilities. The device assists in the diagnosis and treatment of pre-eclampsia and pneumonia.

9. Sayana Press: A contraceptive that comes packaged and pre-filled with a one dose injection system called Uniject.

10. Magnesium sulfate: Reportedly a highly effective treatment for severe pre-eclampsia and eclampsia as well as pregnancy-related conditions.

Another innovation that deserves honorable mention is the winner of a competition funded by Boehringer Ingelheim and organized by HITLAB. The winning device is a wireless pill bottle that benefits people living with diabetes. The pill bottle, in addition to storing medicine, provides data transmission, measuring medicine and sending patient reminders.

These innovations will be vital in the fight against poverty and disease in developing countries.

– Mary Penn

Sources: Business Standard, Boehringer Ingelheim
Photo: Flickr

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Posner Center for International Development

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The Posner Center for International Development, located in Denver, Colorado, is an organization that displays the convergence of over 30 companies working together to help create better living conditions for the world’s poor while also addressing environmental issues. These companies work together to come up with creative and innovative solutions that can help those in poverty while also staying environmentally friendly. While these individual companies already create positive impact, their collaboration can only significantly boost the results.

Bridges to Prosperity is one of the organizations that has joined the Posner Center for International Development. Bridges to Prosperity plans and builds bridges over rivers all over the world. While building a bridge over a river may seem like a small development, it can be life altering. In villages with little transportation, most of the world’s poor depend on walking to reach their destinations. Bridges give them a safe means of transport, whether it is to school, a hospital, to work, etc. So far, Bridges to Prosperity has had projects in South America, Asia, Africa, and Central America.

Another such organization is Nokero, short for “no kerosene.” Nokero’s attempt to eliminate kerosene lights that are harmful to the environment is ambitious but possible. They hope to replace these kerosene lamps with solar lights, which are energy efficient and environmentally friendly. Engineers at Nokero have also developed a solar powered cell phone charger. Such valuable technology is affordably priced and cost effective.

Nokero and Bridges to Prosperity are just two of the 35 organizations working at the Posner Center for International Development. Whether it’s with seemingly simple solutions like building bridges to make transportation easier, or with life changing technologies that bring power to a neighborhood, these organizations’ attempts to change the world are indeed powerful and inspiring. Their collaborative efforts will only result in bigger and better ideas and innovations for the future.

– Aalekhya Malladi

Sources: The Denver Post, Posner Center for International Development, Bridges to Prosperity, Nokero
Photo: Hosted

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What is the OECD?

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What is the OECD?

In short: OECD stands for Organization for Economic Co-operation and Development. It is an international economic organization whose mission is to “promote policies that will improve the economic and social well-being of people around the world.”

A little more detail: In the beginning, the OECD was actually named the OEEC – the Organization for European Economic Co-operation. It was founded in April of 1948, with 18 original European participants. The first and original principles of the OEEC were as follows: “Promote cooperation between participating countries and their national production programs for the reconstruction of Europe; Develop intra-European trade by reducing tariffs and other barriers to the expansion of trade; Study the feasibility of creating a customs union or free trade area; Study multi-lateralization of payments; and Achieve conditions for better utilization of labor.”

In 1961, the OEEC became the OECD, and membership was extended to non-European countries. Most OECD members are regarded as “developed countries” with a high human development index. To this day, according to Pierre Tristam at about.com, the OECD remains one of the most cited sources for “economic data and information” because the organization keeps vast databases and “conducts some of the world’s most authoritative analyses and studies on the world economy.”

The OECD said that it provides a forum in which countries can work together to “seek solutions to common problems.” The organization aims to identify good practices and to coordinate “domestic and international policies.” It is committed to democracy and a sustainable market economy. Some of these good practices include taxes and social security, leisure time, school systems and “pension systems” that look after country’s elderly citizens, since the OECD tries to look at issues “that directly affect the lives of ordinary people.”

Its reach extends to the environment, the economy and social issues. The OECD is committed to helping the lives of ordinary people, thus making life harder for those “whose actions undermine a fair and open society,” such as terrorists, unethical businessmen and tax evaders.

The OECD promotes policies designed:

“To achieve the highest sustainable economic growth and employment and a rising standard of living in Member countries, while maintaining financial stability, and thus to contribute to the development of the world economy; to contribute to sound economic expansion in Member as well as nonmember countries in the process of economic development; and to contribute to the expansion of world trade on a multilateral, nondiscriminatory basis in accordance with international obligations.”

As of 2013, the OECD has 34 active member countries, including the United States, and “is in accession talks with the Russian Federation.”

– Alycia Rock

Sources: OECD: About, OECD: Report 2013, Middle East About, OECD
Photo: CIB

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Gender Equality and the Developing World

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According to the World Bank, gender equality enhances economic development, improves prospects for future generations and strengthens political and social systems. Though women now comprise more than 40 percent of the world’s labor force, they still lag behind men in terms of earnings and productivity. Women also face greater obstacles when it comes to participation in social and political institutions. Particularly in developing nations, the gender gap hinders economic and social development and destabilizes the political environment.

In it’s 2012 World Development Report: Gender Equality and Development, the World Bank suggests four priority areas for improving gender equality. The first is reducing gender gaps in human capital, specifically female mortality and education. Second, improving female access to education and economic opportunities. Third, addressing women’s under-representation in communities and political systems. Finally, understanding how gender inequality applies across generations. These four priority areas help policymakers understand and address problems associated with the gender gap.

Many factors are helping alleviate the gender gap and promote gender equality in developing nations. Globalization and increased access to information are providing women with stronger connections to markets and economic opportunities. These factors also contribute to increasing knowledge about women’s roles in other cultures throughout the world. Perhaps most importantly, there seems to be a broad understanding and growing consensus about the importance of women’s economic, political, and social empowerment.

One area where gender equality seems particularly important is that of agricultural production and food security. The World Bank Report suggests that improving resource access for women could increase agricultural productivity by 4 percent in developing countries. For example, maize production increased by more than 15 percent in Malawi and Ghana when women farmers were provided with the same resources as men. And, according to the World Food Programme, the number of hungry people in the world could be reduced by as much as 150 million if women farmers had the same access to resources as men.

These reports and accompanying statistics suggest that improving gender equality in developing nations will enhance economic production and create stronger social and political systems. With these systems in place, nations and leaders will be better equipped to address the many issues that confront the developing world. Progress has certainly been made when it comes to gender equality. With more and more evidence confirming the importance of empowering women, policymakers would be well served to improve women’s access to healthcare, education, and economic opportunities as well as increasing female participation in social and political systems.

– Daniel Bonasso

Sources: Council on Foreign Relations, World Bank, World Food Program
Photo: Fincon

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Africa Aid: 10 Key Facts And Why They Matter

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Here are 10 surprising facts about Africa that significantly influence aid and development within the continent. These facts about Africa are important to keep in mind when considering Africa within the larger international context. Moreover, these facts can illuminate both the challenges and prospects towards African development.

1. Africa is the second largest continent, both in size and population.

Making up 22% of the world’s total landmass and with 1.1 billion people, Africa is the second most populated continent on the planet. Moreover, Africa’s population is expected to double by 2050. Africa will become the fastest growing continent in the world, population-wise. However, this rapid population growth may not be such a bad thing. In Europe, there are 170 people living per square km; whereas in Africa, there are only 70. Hence, Africa has room to expand and accommodate the upcoming population growth. But in order to accommodate responsibly, much must be done to improve Africa’s infrastructure. Additionally, Africa’s population growth is not coming from an increase in birth rates, but from longer life expectancy. Furthermore, population growth and urbanization are  correlated, just as urbanization and economic growth are. From 1990-2009, Africa’s urban population increased by 114%. During the same period, the world’s urban population increased by only 51%. Sustained population growth will drive urbanization, which will in turn inspire innovation and economic development.

2. Other than Ethiopia and Liberia, all African countries were once colonized by non-African countries.

Africa was divided up in 1884-1885 at the Berlin Conference, which was attended by the UK, France, Belgium, Spain, Italy, Portugal and Germany. National borders were determined without knowledge or concern for local boundaries. The main concern of the colonizers was to assume control over populations and gain access to their natural resources, which they would later extract for their own profit. When the nations of Africa became independent from the colonial leaders, many nations were fraught with intense ethnic conflicts as tribes fought for power. This struggle for power oftentimes led to racial or ethnic oppression. Post-colonial powers often used the oppressed for hard labor and seldom educated these subjugated populations. Moreover, these practices contributed to generations of lost human capital.

3. 61% of all Africans live in rural areas

Poverty occurs in both rural and urban areas, but poverty takes on a different characteristic in rural areas. In developing nations, which most of the nations in Africa are, rural populations partake in subsistence farming, only producing enough to feed their immediate family. Without a steady source of income, families cannot contribute to the larger community’s infrastructure development and the community as a whole suffers. This makes access to education, health and other public services difficult if not impossible.

4. There are an estimated 1,500 languages spoken in Africa and over 3000 distinct ethnic groups (tribes)

Of the 1,500 languages spoken in Africa, hundreds of them are at risk of becoming extinct. As urbanization and globalization increasingly become a reality in Africa, many of the distinct ethnic groups are likely to lose their cultural identity and traditions. If globalization were to encourage the preservation of African cultural identity, these cultures could be preserved in museums and archives. However, passing these traditions down by generation and truly preserving them as living entities may not be possible without considerable efforts by the tribes themselves.

5. There are fewer people with internet access in Africa than New York City alone.

The United Nations recently stated that internet access should be an international human right. Without access to the internet, a majority of the world’s citizens cannot learn, share, or spread ideas. The internet plays a key role in how we interact with one another; our impact is magnified by the modern PA system, which is the Internet. Moreover, most of Africa is without internet access. To provide such services would be to create a market where one has never existed. As Africa develops and technology services become more wide-spread, we can expect to empower a generation.

6. The average life expectancy in Africa is 52.5 years, compared to 69.2 in the rest of the world.

The average life expectancy in Africa varies from country to country. Some nations, like Sierra Leone, have a low life expectancy of 47. Whereas other African nations, like Seychelles, have a long lifespan of 74. Although the average African lifespan is below the average world life expectancy, there is hope. The life expectancy in Africa increased by 5% between 2000-2009, compared to merely 3% in the rest of the world.

7. The prevalence of HIV for people 15-49 in Sub-Saharan Africa is 7 times that of the world prevalence.

HIV/AIDs is the most common cause of death in the Sub-Saharan region. Possible reasons for why HIV/AIDs is so much more common include: high rates of poverty, rapid urbanization, genetics, or gender inequality.

8. 90% of all malaria cases occur in Africa. 3,000 children die each day in Africa from malaria.

People who have limited immunity to malaria, such as young children, women, and travelers from out of the area are more susceptible the disease. In addition, lack of access to health care in rural areas makes treatment for malaria more difficult.

9. Merely 42% of the urban population has access to improved sanitation, while only 24% of the rural population does.

In developed countries, like the US and the UK, 100% of the population has access to improved sanitation. In order to provide better access to proper waste disposal systems and clean water, a hefty investment is required by the governments of African nations, or else by the private sector, in the continent’s sanitation infrastructure. Low access to proper sanitation can be a health risk to exposed communities, which can lower one’s expected lifespan.

10. In 21% of Sub-Saharan African Countries, one or two products accounts for at least 75% of total exports.

In most developed nations, a huge strategy towards economic proficiency is to diversify exports. With few exports at their disposal, Sub-Saharan African nations set themselves up for poor economic growth and a potentially stagnant private sector. Diversity in exports can reduce income volatility for countries with large populations in poverty and reduces vulnerability to sharp declines in trade. Diversification increases the potential for generating spillovers. Traditionally, as a country’s average income rises, their exports become more diversified. But to increase average national income, many of these countries require investment in the private sector. Investment in Sub-Saharan African nations, be it through enhanced public education or career services or through corporate foreign direct investment, can raise national average income.

– Kelsey Ziomek

Sources: Facts, About, Traveling Myself, World Bank, World Bank, World Bank, Brookings
Photo: The Guardian

Zonal Champions: Reinventing Word of Mouth Advertising in South Africa

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Despite advances in advertising in recent years, word of mouth is still considered by many marketing experts to be the best form of advertisement. As businesses look to increase their presence in South Africa, word of mouth publicity could be the key to appealing to otherwise unreachable demographics.

Zonal champions, as they are called by marketing agency Creative Counsel, are human advertisements. They are members of local communities who are employed to represent a brand and promote appropriate products during their everyday conversations. The potential consumers are able to freely question zonal champions about the products, allowing for all curiosities to be satisfied before a purchase is made.

Nontando Vena, a zonal champion for South African mobile phone company Vodacom, says she doesn’t have conventional work hours. Instead, she promotes the brand “24/7, 365,” and members of her community occasionally refer to her as “Miss Vodacom.”

The merits of zonal champions are numerous for both the customers and the providers. For businesses, zonal champions are able to reach rural parts of Africa that traditional advertisements are unable to. Upwards of 550 million people are without electricity in Africa, which represents a massive untapped market for businesses to sell products. A zonal champion only needs two to four days to be properly trained, and they can continuously reach rural customers on a daily basis.

South African consumers are more welcoming of zonal champions than they would be of commercials and billboards. Consumers are more trusting of a friend or family member than they are of an advertisement, and this is especially true in South Africa. Zonal champions are able to give a familiar face to otherwise detached companies, which let consumers feel more comfortable with new brand names.

Economically, zonal champions are also beneficial to the many rural consumers who are forced to be judicious with their income. While the income of South Africans has risen by upwards of 170% in the past decade, the average annual income is still about $6,258. As a result, South African consumers are extremely hesitant to invest in products they are unfamiliar with. By answering questions and recommending products, zonal champions are able to engage local citizens and let them know if the product being offered will meet their needs.

In addition to the benefits for businesses and consumers, the zonal champions themselves are able to benefit from this unique form of employment. Unemployment in South Africa remains very high, with up to 24% of citizens without work. Many of these people have no access to education, and therefore are considered “unemployable.” There are no prerequisites to become a zonal champion, and the work itself primarily involves being present in a community. This allows a new opportunity for these “unemployable” citizens to find work and curb the harsh unemployment rate in the process.

Africa’s economy is among the fastest growing in the world now, and international businesses are starting to take notice. President Obama’s recent trip to Africa highlights the continent’s growing relevance in the global economy, and zonal champions will surely play a large role in growing markets in these once impoverished parts of the country. With the numerous advancements in technology and advertising in recent years, zonal champions prove that old fashioned conversation is still as relevant as ever.

– Timothy Monbleau
Sources: Linkedin, How We Made It In Africa, CNN, Creative Counsel, BBC, Google Currency Conversion, World Bank, Vodacom
Photo: Riger Jabber

 

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US Foreign Aid to Africa: What We Give and Why

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In 2012, the United States provided nearly $12 billion in official development assistance (“ODA”) to African nations. The ODA is allocated to education, health, infrastructure and economic development programs in recipient countries. Currently, the United States allocates foreign aid to 47 African nations and USAID operates 27 missions on the continent.

US Foreign aid to Africa began in the 1960s as many African nations gained independence and the United States sought strategic alliances to counter the influence of the Soviet Union. With the exception of disaster and famine relief, most foreign aid to Africa began to decrease with the collapse of the Soviet Union.

In the 2000s, President Bush more than tripled aid to Africa by establishing programs such as the Child Survival and Health Programs Fund as well as the Global HIV/AIDS Initiative.

Though foreign aid programs are designed to assist recipient nations with development, they also benefit the United States in a number of ways.

First, these programs help build strategic alliances and foster support for democratic transitions. It also stimulates Africa’s growth and development, which provides opportunities for increased trade and direct investment in the continent’s emerging markets.

But for all the benefits, foreign aid to Africa has no shortage of detractors. Many critics point out that much of the money allocated to Africa never reaches the people who most need the assistance. “Eighty percent of U.S. aid to Africa is spent right here in America — on American contractors, American suppliers, and so forth,” said George Ayittey, president of the Free Africa Foundation.

In more corrupt nations, politicians and civic leaders are often charged with misappropriating funds designated for the people. Others critics claim that foreign aid to Africa simply does not work—after 50 years of assistance, Africa still confronts the same issues.

But even critics would have to agree on one crucial point: foreign aid is an integral part of U.S. foreign policy. In Africa, aid programs support a large framework of social and economic assistance for developing nations.

Critics are correct that American companies and corrupt politicians siphon a large portion of foreign aid. But aid to Africa has also done much to improve infrastructure, bolster economic development and improve health care conditions for millions of people on the continent.

– Danial Bonasso
Sources: Foreign Policy Initiative, Washington Post, NPR, One.org
Photo: James Bovard

SoleRebels: Shoes With An Impact

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Recently profiled by both CNN and Forbes as an important businesswoman to watch, Bethlehem Tilahun Alemu is quite the success story. While growing up in the small Ethiopian town of Zenabwork, Alemu remembers waiting for a better life to develop for her friends and family, before realizing that she would have to create the reality that she wanted to see. And so, in 2004, she created soleRebels.

SoleRebels is a Fair Trade shoe company that harnesses the artisan skills and recycling habits inherent in Zenabwork’s culture. The company employs locals and pays four to five times the legal minimum wage and over three times the industry average, allowing workers to earn a respectable income and support their families. Workers are paid a straight wage without regard to individual quotas. Most workers live within walking distance of the factory, but transportation is provided for disabled workers who can’t make the trek. Workers and their families are also provided with complete medical coverage, including site visits by board-certified practitioners. Such site visits are especially important considering that competent doctors can be few and far between in Ethiopia.

The company’s original shoe design was based on the traditional selate and barabosso shoes made from recycled tires. In a poignant nod to Ethiopian history, these were the same shoes worn by rebel fighters who opposed colonization by westerners, and who helped make Ethiopia one of only two African countries never to be colonized. This is incredibly consistent with soleRebel’s mission, which is largely based on the need for more African start-up companies that fuel economic growth and independence, rather than NGOs and charity organizations that often do more harm than good.

Currently, their market has expanded considerably. The company now makes numerous different types of shoes, including tooTOOs (similar to TOMs), lace-ups, sandals, slip-ons and coZEEs (similar to UGGs). They even have a line of vegan footwear called b*knd. Their products are sold online and in 30 countries worldwide.

Although their production has increased substantially, almost all products are still made and sourced locally. For example, every piece of fabric used in the making of soleRebel’s shoes is hand-loomed using traditional eucalyptus looms. This process preserves an ancient craft, cuts down on electricity bills, produces absolutely no carbon output and creates beautifully unique fabrics. And the company still uses hand-cut recycled tires for the soles of every shoe, preserving tradition and saving the environment in one fell swoop.

SoleRebels is a great example of poverty fighting done right. This shoe company continues to empower countless numbers of people, who use their talents and preserve their traditions to stake their claim in the world market. Locally and fairly sourced products, combined with beautiful craftsmanship and entrepreneurial know-how, create some great-looking shoes that will leave you feeling even better.

– Katie Fullerton

Sources: soleRebels, Forbes, CNN
Photo: INSP

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McDonald’s as a Poverty Indicator?

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Today the fast food giant McDonald’s is so ubiquitous in the United States that it is hard to imagine a world where it doesn’t exist. McDonald’s has 34,480 restaurants in 119 countries. The fast food chain even has restaurants in Cuba. Despite vast numbers, 105 nations still do not have a McDonalds. These McDonald’s free nations include Ghana, Jamaica, Yemen and Tajikistan.

What is the significance of the spread of McDonald’s? The spread of McDonald’s Big Macs and French fries across the world is a clear  indicator of globalization. What started off as an American fast food restaurant has slowly but surely reached every continent. In a study by Princeton University, entitled “The Fries that Bind Us”, globalization is mapped by the concentration of McDonald’s restaurants in various countries. The map clearly reveals McDonald’s restaurants congregated around the U.S, Europe and part of China.

Most importantly, the distribution of McDonald’s restaurants can work as an indicator of the relative wealth of a nation. Michael Centeno, sociologist at Princeton University has stated “If you want a definition of what the rich world and the poor world are, well, if you can get a McDonald’s, you are in the rich world.” According to Centeno wealth and the number of McDonalds are directly correlated. Thus poorer nations in sub-Saharan African and poor and central Asia have far fewer opened McDonalds restaurants.

Additionally, the presence of McDonald’s restaurants is correlated with a nation’s economic development and stability. Ho Chi Minh City in Vietnam is about to open its first McDonald’s in the next year. What this mean is that Vietnamese consumers now have enough disposable income to indulge in American fast food. At the same time, nations may lose their McDonald’s due to declining economic situations. For example, Iceland has shut down all of its three McDonald’s chains following severe economic down turn and a currency crisis.

Some people may insist that the growth or decline of McDonalds in any region may be mostly related to the culture of the area. While culture does play a role in the spread of fast food, the growth of McDonald’s overseas can truly be a sign of wealth and development. That is to say, as poor or developing countries expand economically, they are able to take part in the luxuries of developed nations. Furthermore, economists have even developed what is known as the Big Mac Index, an informal way to compare currencies across nations. Whether or not more French fries or burgers are truly beneficial for the global poor, the spread of McDonald’s definitely indicates where wealth and poverty tend to linger.

– Grace Zhao

Sources: Princeton University, NPR, The Economist
Photo: 1-800-Politics