IBDP Economics Chapter 18 Notes

foreign sources of finance and foreign debt

STUDY NOTES FOR ECONOMICS CHAPTER 18 –  FOREIGN SOURCES OF FINANCE AND FOREIGN DEBT

These notes have specially been curated by expert teachers to simplify and enlighten concepts given in IB Foreign sources of finance and foreign debt HL. The notes are comprehensive in nature and are sufficient to study the chapter in depth and one need not look for other resources beyond the notes provided on our website which can be accessed for free. The notes for Foreign sources of finance and foreign debt IBDP HL are available on our official website and can be downloaded for free. The material made available on Tychr’s website is available for all IBDP subjects and is specially curated after an extensive amount of effort to ensure that the notes are in consonance with the IB curriculum and are an amalgamation from various textbooks prescribed by the IBO.

In this chapter we study about foreign sources of finance which help countries acquire foreign exchange, add to insufficient saving, add to technical skills, management skills and technology. foreign direct investment which is the formed investments in a host country and MNCs are discussed in detail in the chapter. The large size of the MNCs and the superior part make the foreign direct investments very important financial sources to developing countries. The MNCs usually choose those countries for investment that provide low cost labour and natural resources and they look for political stability, stable macroeconomic environment, institutions that favour FDI, liberalised economy and trade policy and large markets with Rapid economic growth and good infrastructure and educated labour force.

The chapter we locate foreign aid which is the transfer of funds or goods and services to developing countries to bring improvements, which are concessional and non-commercial in nature. Humanitarian aid development aid and official development assistance are some kind of foreign aid which are received by the developing and less developed countries. The advantages in citizens of official development assistance and NGOs are discussed in the chapter in detail for the students to have clarity of concepts. The various nuances and aspects of trade and aid are discussed in the chapter in detail so as to understand that both the concepts are of importance to the developing, less developed and underdeveloped countries for economic growth. Multilateral development assistance like that from the World Bank and the International Monetary Fund are also discussed in the chapter in detail. Lastly, the chapter studies the role of international date its consequences and HIPC initiative