Topic Area B: Third World Debt Crisis

Third World debt has been a recurrent global problem in the past few decades. Demise of colonialism, corrupt leadership, as well as mismanaged lending and spending by the developed nations have contributed to the third world debt crisis we face today. The debt crisis affects both nation-states and their indigenous populations. Millions of people in third world countries face poor living standards because of their countries’ enormous debt payment. Nation-states are constrained to apportion large amount of their output for repayment of debt. Therefore, not enough funds are allocated for factors of development such as health and education.

We will analyze the causes, the magnitude, and the current policies concerning Third World debt. We will question the effectiveness of current policies and work together to minimize the debt. The Economic and Financial Committee will specifically examine:

1. Standard of Living: How do standards of living compare between developed and undeveloped nations? What methods can we implement in order to improve the standard of living in third world countries?

2. Aid Initiative: The current aid given by the developed nations is insufficient in comparison to the amount of Third World debt. What can be done to increase aid and decrease debt? What are some incentives for the developed nations to contribute to this crisis?