The Impact of Economic Development in Developing Countries
What is the impact of economic development in developing countries?
Economic development in developing countries can be defined as programs, policies, and activities that seek to improve economic wellbeing and quality of life in countries with a low standard of living. They need to develop the industrial base in them so that economic development is planned in accordance with the conditions and challenges of developing countries.
In general, economic development affects developing countries in many areas, and the most prominent effects of economic development in developing countries are the following:
- · Raising the quality of education
One of the most important effects of economic development in developing countries is raising the quality of education. It increases the percentage of learners, and the percentage of those enrolled in primary and secondary schools, in addition to higher education institutions such as colleges and universities.
- · Providing more job opportunities
Economic development provides a greater range of goods and services, which achieves the concept of economic diversification, thus providing greater opportunities for work in various fields in developing countries, which raises the employment rate in these countries.
- · Improving income levels
Given that economic development plays an important role in raising the employment rate in developing countries; This leads to raising the income level of citizens in these countries.
● Improving the quality of life
When a greater range of goods and services is available in developing countries as a result of their economic development, purchasing power increases in these countries, which leads to improving the quality of life for a larger number of citizens.
● Decreasing immigration rates
While economic development affects the standard of living in developing countries and works to improve it, citizens will experience a better standard of living over time, which will prompt them to stay and continue in the countries in which they live, which plays a major role not only in promoting economic development in these countries; Rather, it aims to reduce the rate of immigration abroad.
Given that Saudi Arabia is one of the leading countries in economic development, it has paid attention to working on this field in developing countries as part of its mission and vision, and what is attested to it in the field of economic development in developing countries, which is the establishment of the Saudi Fund for Development.
The Saudi Fund for Development aims to finance development projects in developing countries by providing financial, technical, and human resources to meet the needs of those countries, and to promote sustainable development in developing countries of the world, as the total funding in this fund reaches 70.3 billion riyals in 84 countries from different continents.
How to promote economic development in developing countries?
There are many methods and solutions through which economic development can be enhanced in developing countries, whether these efforts are internal or external, and they include the following:
Internal efforts to promote economic development in developing countries.
Some of the methods and solutions that rely on developing countries, their policies, and their governments to achieve the concept of economic development are the following:
● Working to improve the business environment in developing countries.
Instead of collecting taxes to improve public goods in developing countries, governments and institutions can develop alternative financial plans, so that a portion of the state’s revenues will be allocated to improving, developing, and investing in the business environment with the aim of raising the level of income and promoting economic development therein.
● Achieving the concept of transparency in developing countries
The process of creating a transparent and accountable environment in developing countries, in which the highest standards are achieved, contributes greatly to achieving the concept of economic development in developing countries. These efforts mainly depend on the policies and governments of these countries.
● Empowering the private sector in developing countries
Economic development in developing countries is not based only on raising and saving money. Rather, it is about empowering sectors that can raise the level of business in them, such as the private sector, which has its role and competencies in achieving economic development.
● Benefiting from local resources in developing countries
Local resources are among the most important sources of financing in the world of economics, so studying them and utilizing them efficiently contributes to achieving the concept of sufficiency in developing countries and not needing foreign aid, which enhances economic development there independently.
External efforts to promote economic development in developing countries.
Some of the methods and solutions that rely on economically empowered countries to achieve economic development in developing countries include the following:
- Providing soft development loans to developing countries
The idea of providing a soft development loan instead of providing financial aid is a smart step to help develop developing countries and promote economic development in them, and Saudi Arabia has played a prominent role in that. The loan agreements signed have reached 739 loans so far in many countries on different continents.
An example of these loans includes the Saudi Fund for Development laying the foundation stone for the Mangoky Bridge in Madagascar. The Fund contributed to financing its construction through a soft development loan amounting to $20 million, in addition to the development institutions and funds of the Arab Coordination Group and the Government of Madagascar to support infrastructure and promote growth in the Republic.
- · Implementing development projects and programs in developing countries
Economic development can be achieved and enhanced through programs and projects that are provided to developing countries, and not only through loans. Saudi Arabia has sought to enhance the concept of development by contributing to approximately 702 projects and programs in 84 developing countries from different continents.
- · Cooperation with regional and international organizations
Cooperation with regional and international organizations can improve the level of services, projects and programs provided to enhance economic development in developing countries. Speaking of this step, Saudi Arabia has supported organizations concerned with combating poverty at the global level, including:
- Aid, relief, and foreign aid projects provided by the King Salman Humanitarian Aid and Relief Centre.
- United Nations Development Programme.
- The United Nations Relief and Works Agency for Palestine Refugees, also known as UNRWA.
- United Nations Industrial Development Organization.
- United Nations Children’s Fund.
- The Arab Gulf Program to Support United Nations Development Organizations.
The most important areas of promoting economic development in developing countries.
There are many sectors through which economic development can be promoted in developing countries, and Saudi Arabia has made efforts in a group of them. The most prominent and important of which is what Saudi Arabia has provided through the Saudi Fund for Development in each sector:
Transport and communications sector
This sector is one of the largest vital sectors addressed by the Economic Fund for Development, which includes: Roads, railways, seaports, airports, and communications. Its development contributes to raising the quality and efficiency of infrastructure in this sector.
Agriculture sector
The goal of financing and developing this sector is not only to support the economic growth of individuals and communities in developing countries. Rather, it is about achieving a set of development goals that can facilitate access to social services. In addition to securing food for all in order to achieve a better standard of life for the members of society.
Energy sector
In addition to increasing the number of jobs, one of the most important goals of the Fund’s support for the energy sector in developing countries is to promote social growth, as energy provides basic services to the population in developing countries and provides them with electricity services that can raise the standard of life in general. The Fund has contributed to a group of projects on different continents.
Industry and mining sector
Enhanced to contribute to supporting the industrial and mining sector, as well as developing economic and investment opportunities in developing countries in order to achieve social growth there. This is due to benefiting from local industry and available competencies, so that it is being developed to reach global markets and thus enhance economic growth there.
Social infrastructure sector
Supporting the social infrastructure sector in developing countries works mainly to develop human resources, in addition to increasing efficiency and productivity in these countries and improving the standard of living and health of their citizens. Saudi Arabia believes in the importance of this sector, and it has had the largest share in the number of projects that the Fund has supported in several different fields, including water and sanitation, health, education, housing, and urban development.
