Introduction | Overview | Population | Life expectancy
A world of empires | Independence | Rich and poor
Before and after | Did you know? | Find out more

Rich and poor

Although much of the Third World managed to shake off the chains of imperialism during the course of the century, economic dependency on the West was much harder to avoid.

Despite considerable growth in the economies of underdeveloped countries by 1975, with improvements in infant mortality, literacy and life expectancy between 1945 and 1975, the last quarter of the 20th century witnessed a sharp increase in Third World poverty. By the 1980s, a third of the population of the world was living in countries that were experiencing zero economic growth or actual decline in production.

For many countries, the growth of free trade and globalisation meant producing goods for Western markets while paying low wages to local workers and not providing adequate food for the home population. By 2000 ...

• about 1 billion (1,000 million) people in the world faced a daily struggle to survive

• at least 400 million – and possibly 1.4 billion (1,400 million) – people did not receive adequate food

• perhaps as many as 2 billion people (2,000 million) did not have safe water to drink

• about 40,000 children died every day from deprivation.

In 2000, even if the growth rate of underdeveloped countries had doubled, it would still have taken 100 years for them to catch up with the West, and then only seven would have managed it. For the next seven to catch up would have taken 1,000 years.

Throughout the last half of the century, the average income of Western countries was a large – and increasing – multiple of that of the Third World:

• 1960: 20 times

• 1980: 46 times

• 1990: 55 times

In 1990, while the West's banks lent $87 billion to the Third World, they got back $130 billion in loan repayments and interest.

Capital flows, increasingly disconnected from any real trade or investment, grew enormously during the period 1985-2000. Every day, about $2 trillion (that's 12 zeros) moved around a stock-market world of derivatives, futures and currency trading. The capital that electronically crossed the world's borders in three days exceeded a whole year's global trade. Yet, in the age of the Internet, 1.3 billion (1,300 million) people worldwide each have to live on less than 70 (UK) pence a day.

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