Assess the view that debt has become the main obstacle to the development of less developed countries
It can be argued that debt has become the main obstacle of less economically or in general terms less developed countries to actually develop. However, debt alone cannot be the reason why countries have not developed there many things that need to be taken into consideration such as aid being misspent by governments, war and natural disasters. These are just some of the reasons that are the cause of countries not being able to develop alongside debt.
It is apparent that debt is a reason for a nation not developing but not exactly the main reason as there are many factors to consider. However, it is one of the reasons and this is apparent as countries borrow from places such as the IMF and World Bank to trigger development, which in a lot of countries does not happen and these funds are not used to necessarily benefit the people of the developing countries. The aims for governments in developing countries should be try to eradicate or decrease poverty, build infrastructure to trigger development, improve healthcare and education. Although, these are the desired aims for the people in these LEDCs the country gets itself in more problems when it borrows money as they become a country in borrowing culture. For example, countries like Ethiopia who are in debt, which is inevitable that they will never be able to pay as 90% of their income is result of aid and borrowing. Borrowing may be high because of a disaster prone country like Ethiopia who experience famine hence why they have to borrow a lot and receive a lot of aid.
One way which debt is caused is through western financial institutions which lend money to developing countries. A large amount is given to African countries and this roughly accounts for 75% of their private lending, where the other 25% comes from