which is beneficial to a third world country?

Question

is it foriegn loan or foreign investments??? do we have to barrow money from the foreigners or ask them to invest in our country???
economists help me out here please!!!!!!

Answer 1

Both loans and investments are good for any developer be it a third world country or a town plaza. If you offer more capital to an area, then it will have the opportunity to expand. It's the offerer's job to see if good management is in the area so as to make sure the capital won't be wasted. It's the inhabitants responsibility to promote good management to attract the funders.

When it comes to peripheral nations though, foreign investment is usually the better one because it reforms a government. This happens in two ways. First, the government sees how the people approve of both the products and jobs being offered by the investors so the government wants to hold onto the investment for both approval and infrastructure/ budgetary purposes. Second, in order for investment to happen in a country, the investors have to deem it as having viable contract and property rights which are a sign of democratic development. The more investors a country has, the more free it appears and the better its image is on the world political theatre.

Loans help as well, but loans can often default which can lead to a devaluation of currency which can lead to unfavorable trade balances due to poor credit ratings. Countries receive loans based upon how well the world market views its credibility and likeliness to default, so if the developing country can't pay off its loans, then its future rating goes down and its likelihood to receive favorable loans (or investment) in the future goes down too!
----------------
Therma, I can't put it any more nicely than to say you are just way off the mark. Social Entrepreneurs invest all the time in the periphery and help them out as well such as the microcredit situation in India (the guy who started it won the nobel peace prize, IMAGINE THAT!). I strongly advise you look at a dictionary and look up the word investment to understand the fundamentals of why any form of investment is good.

Answer 2

foreign aid and investment is one way the more developed countries control the 3rd world.even worse is that 3rd wolr leaders are corrupt and will always accept foriegn aid to satisfy their greed.had foreign aid been used wisely by 3rd world countries, i don't think it would be an issue and more developed countries would not be able to control the 3rd world becasue they would have generetd enough wealth to be self-reliant.
it's a 2 way issue - developed countries want to control the 3rd wolrd, while corruption in the 3rd world has left inlets for this aid and sub-standard investment to continue to seep in

Answer 3

foreign loans are tools to crush countries and tie them up to do our biddings or suffer the consequence, because they can never pay them back....that's the only reason we ever "give" a loan to a country...to rule them - SO THAT'S OUT

...what was the other one?