Lecture slides of Chapter 3, CMDC, Mutual needs of the developed and developing countries, Nepal Engineering College, Pokhara University

1. Chapter 3
Needs of the
Developed and Developing Countries
(2 hours)
Prof. Dr. Hari Krishna Shrestha
Nepal Engineering College
Updated: May 20, 2020

2.  Human Resources (at low wage)
 Knowledge worker (Doctors, nurses, engineers, programmers …)
 Trained/untrained labor at low wage
 DDDD works (Dangerous, Dirty, Demeaning Difficult works)
 Natural Resources (minerals and raw materials for industrial
processing and value addition, fuel, herbs)
 Market for products (sell products to create and maintain job for citizens)
 Investment opportunities (virgin market with high profit margin, low
regulation, production of quality goods at cheaper rate through FDI)
 Cooperation to limit GHG emission (to prevent big cities from sea
water intrusion)
 Self respect of citizens (Demonstration of aid to developing
countries), fulfilling commitment of ODA
 Promote National Image through soft-power:
 Favorable bilateral negotiations/treaties
 Support in contentious international disputes:
 Support in UN General Assembly:
Needs of Developed Countries
(from developing countries)
The ability of a country to make others behave according to its wishes – without employing any form of force or
coercion is “soft power.”

3.  Destination for obsolete technology (national pride, meet
international obligations, space for new technology)
 Dump site for waste (scrap metal, plastic, used glass wares and
paper, other solid waste, chemical, biological, nuclear NIMBY syndrome)
 Test of new medicine and risky technology (low tort liability)
 Maintain global biodiversity (effect of loss of species unknown)
 Medicinal plants for development of medicine (research
opportunities, unavailable in native countries)
 Population growth control in developing countries (prevent
global environmental degradation)
 Less global conflict (threat from Developing Countries’ people)
“Development isn’t charity. It’s one of the smartest invest we can make in
our shared future, our security, our prosperity”, President Obama, July
20, 2016, The White House Summit on Global Development
 Control Terrorism, Drug Trafficking and Money Laundering
• (buffer states against terrorism)
 Control Pandemic: A pandemic anywhere is a pandemic everywhere.
Needs of Developed Countries
(from developing countries)

5. Nepali Sansar, May 27, 2019
https://www.nepalisansar.com/immigration/nepal-employment-overview-more-than-5-5-mn-migrants-work-
overseas/

6. In 2016-2017, the Department of Foreign Employment
(DoFE) issued 786,564 new permits, for more than 100
destination countries.
https://asiafoundation.org/2018/06/06/nepalese-labor-migration-a-
status-report/

7. Ways of fulfilling the needs
• Human Resources: Attractive salary and working conditions, DV, PR, H1B,
residency and work permit, exchange visa (J1), student visa (F1), training
visa, post completion training, refugee, exposure tour, cultural exchange
programs, scholarship, RA/TA
• Natural Resources: Lease, purchase, research, study, joint venture,
bilateral agreement/ negotiation, WTO provisions, trade embargo,
protectionism, bribe officials (cash, trip, donation, present, recognition…)
• Trade negotiations: direct/indirect barriers on import of processed (value
added) goods and no barrier on unprocessed goods from developing
countries, “Scholarship Diplomacy”, creating Bibhishans!
• Investment: EXIM Bank, World Bank, ADB, Multinationals, FDI, JVs
• Soft-power: popular culture, TV/cinema, high tech gadget, educational
system, way of life, (China’s quest for soft-power, Navin Subedi, 26 June 2019, Asia Times)
• Promote Recycling Industry: Export waste to recycling industry and
promote recycling in developing countries
• ODA: JICA, DFID, USAID, AusAID, DFAT, KfW
• Targeted funding: env. friendly policy/programs
For additional info on trade negotiation:
http://www8.gsb.columbia.edu/faculty/jstiglitz/sites/jstiglitz/files/2004_Charlton_Stiglitz.pdf

8. Ways of fulfilling the needs
• GHG limitation: Carbon trade, carbon sequestration, technology
improvements, technology exchange
• Testing of medicine: free medical camps, free medicine/vaccination/
camps/vitamins/operation/surgery/polio drops/family planning
• Military training/Defense Aid: To prevent terrorists from spreading into
developed countries
• Overseas Development Assistance: with maximum publicity
• Threat and intimidation: When normal means do not work (hard power)
• Trade Blockade, Regime Change and War: Extreme tool of need fulfillment
For additional info on trade negotiation:
http://www8.gsb.columbia.edu/faculty/jstiglitz/sites/jstiglitz/files/2004_Charlton_Stiglitz.pdf
More importantly, these (ODA) programs give American taxpayers a phenomenal return on investment, one
of the best anywhere in government. They do this in three ways:
• Making Americans safer and the world more stable
• Creating jobs at home and promote trading partners that will buy American goods
• Saving lives and building up health systems so other countries can take better care of their people
Bill Gates, May 18, 2017, https://www.gatesnotes.com/Development/Foreign-Aid-Keeps-Americans-
Safe?WT.mc_id=20170518171534_MayForeignAid_BG-TW&WT.tsrc=BGTW&linkId=37735975
Senior Brookings fellow George Ingram declared that foreign aid is a bipartisan issue because it “advances three
fundamental U.S. interests: it keeps us safe, it meets a moral imperative and builds economic prosperity.” He also
indicated that this investment could also be considered a kind of insurance, which describes one of the U.S.
benefits from foreign aid to Nepal after the 2015 earthquake. https://www.borgenmagazine.com/u-s-benefits-from-
foreign-aid-to-nepal/

9. Related topics on the ways used by developed countries to fulfill their needs:
• "We urge the developed countries to fulfill their commitments of providing 0.7
percent of the GNP to the developing countries and 0.15 to 0.2 percent of GNP to
the LDCs as Official Development Assistance without further delay."-- PM Baburam
Bhattarai, addressing NAM in Tehran, Iran, August 31, 2012
• The average cost of college tuition is projected to be more than $46000 a year at
in-state public universities, more than $ 80000 a year at out-of-state public
universities and over $103000 at a private college by 2030. (American Funds,
Investor News, page 3, Dec. 31, 2014)
• From 2062 to 2071, more than 3.5 million Nepalese youth (30% of youth
population of Nepal) has gone abroad for job.
• USA exports about US$ 5 Billion worth solid waste to China, 6th largest export from
USA to China (September 2017) http://money.cnn.com/2017/09/11/news/china-scrap-
ban-us-recycling/index.html
• CSIRO/Australia, UK and US to test malaria breathalyzers in Bangladesh, Malawi,
Sudan. http://www.scidev.net/global/malaria/news/malaria-breath-test-
CSIRO.html?utm_medium=email&utm_source=SciDevNewsletter&utm_campaign=internati
onal%20SciDev.Net%20update%3A%2031%20May%202016
दाताको खर्चमा कमचर्ारीको पालैपालो विदेश भ्रमण
Posted By News24Nepal.TV || Date: 23 September, 2018
http://www.news24nepal.tv/2018/09/23/404604
काम थाती राखेर कममचारी पालैपाले विदेश जाने गरेका छन्। विदेश
भ्रमणपछछ दाताकै अनुकु ल छनणमय गने गरेको आरोप लाग्ने गरेको छ ।

10. Nepali Times, June 15, 2016, Blame game in forestry, termination of 10 year Multi
Stakeholder Forest Program in 5 year.
July 1, 2016: Japan and Nepal agreed on 30 carod 60 lakh scholarship fund
for 100 government officials to study in Japan, this amount to be considered
as part of ODA. Major part of this “assistance” will be spent in Japan, as tuition
fee, international travel, educational materials, … Such agreements help them
fulfill ODA commitments, raise self respect of its citizens, win hearts of
trainees, spread their culture, and keep the financial resources to themselves.

11. ODA को नेपालीकरण:
गरीि बस्तीका एक प्रछतष्ठित स्थानीय छनमामण व्यिसायीलाई “समाजसेिा” गनम रहरलाग्यो र एउटा
मष्ददर बनाउने छनधो गयो। मष्ददर छनमामणको लागग आयोष्जत धार्ममक सप्ताह कायमक्रममा उक्त
छनमामण व्यिसायीले १० करोड चददाको घोषणा गरे र दानिीर कणमको उपाधी पाए, उ र उस्को
पररिारका सदस्यको समाजमा मान बढ्यो, उनीहरूको बोली पहहला भददा बढी बबक्न थाल्यो। यसै
घोषणाको कारण दुईचारिटा स्थानीय प्रोजेक्ट पछन अर्ल बढी रेटमा िा favorable terms and
conditions मा हात पयो। घोषणाको २ िषमसम्म पछन रकम नपाएपछछ मष्ददर छनमामण सर्मछतको
पटक पटकको अनुरोध पछछ २ करोड चददा ससतम हदन स्िीकार गयो। सतमहरूूः
१. चददाको चेक उपलव्ध गराउन िृहत कायमक्रम आयोजना गनुमपने र उक्त कायमक्रमको सम्पूणम
ष्जम्मा िहााँलाई िा िहााँको आफ्नो मादछेलाई हदनु पने,
२. उक्त कायमक्रममा भएको खचम चददाको रकम, १० करोड, बाट कटाइने
३. मष्ददर छनमामणको िेक्का िहााँलाई िा िहााँको आफ्नो मादछेको छनमामण व्यिसायी कम्पछनलाई
िहााँहरूले छनधामरण गरेको दरमा हदनु पने
४. आिस्यक सम्पूणम छनमामण सामगि िहााँको आफ्नो मादछेको पसलबाट खरीद गनुम पने
५. परामशमदाता कम्पछन िहााँको आफ्नो मादछेको हुनु पने
६. खररद प्रकृ याको लागग आफ्नो छु ट्टै छनयम लागु हुने
७. मष्ददर छनमामण पश्चात िहााँ र िहााँको पररिारका सदस्यहरूले लाइन नबसी दशमन गनम पाउनुपने
८. मष्ददरको पुजारी िहााँले छादन पाउनुपने िा िहााँले बनाउनुभएको प्रकृ याबाट छादनुपने,
पुजाविगध िहााँले स्िीकृ त गरे अनुसार हुने
९. मष्ददरको चारै कु नामा िहााँ र पररिारका सदस्यहरूको दानहदएको रेकडम फोटो सहहत हाल्नुपने
१०. िवषमकरुपमा िहााँ र िहााँको पररिारका सदस्यहरूको औपचाररक कायमक्रम गरी सम्मान गररनुपने

12. Examples of waste and scrap metal dump from Developed to Developing countries:
The Philippines on Thursday recalled its ambassador and consuls in Canada after Ottawa
missed a deadline to take back tons of unwanted trash that have been rotting near Manila
for nearly six years. (The Washington Post, Asia and Pacific, 16 May 2019.
https://www.washingtonpost.com/world/philippines-recalls-its-envoys-in-canada-over-tons-
of-rotting-garbage/2019/05/16/1d80d808-7792-11e9-b7ae-
390de4259661_story.html?noredirect=on&utm_term=.61a1ca69be12
In a step toward "fighting against plastic waste," the government of India has completely
banned plastic scrap imports. The ban affects U.S. exports of more than 12,000 metric tons
of material worth more than $46 million, according to the Washington-based Institute of
Scrap Recycling Industries (ISRI). 6 March 2019,
https://www.recyclingtoday.com/article/india-bans-plastic-scrap-imports/
China imposed a ban on the import of most varieties of plastic wastes in the beginning of
2018.
https://www.wartsila.com/twentyfour7/environment/china-bans-plastic-waste-imports-a-
blessing-in-disguise 9 January 2019
According to the UNEP study, the developed nations dump e-waste in “developing” Asian
countries (India, Bangladesh, China and Pakistan) through illegal trade routes.
https://ipen.org/sites/default/files/t/2012/09/Report-on-Illegal-import-and-trade-off-of-e-
waste.pdf Environment and Social Development Organization, Dhaka, 2011

13.  Education and Training of its human resources (close
knowledge/skill gap)
 Investment in Infrastructure projects (lack of large fund)
 R&D in “Appropriate” Technology (site specific research)
 Humanitarian assistance during disasters (unprepared for
major disasters, as evidenced by Covid-19)
 Loan/grant for regular development activities (donor
dependency)
 Increased in management system efficiency (low management
skill)
 Health needs (low access to medical facilities even for regular
illnesses and during pandemic)
 Water/sanitation/hygiene needs (access to potable water, proper
sanitation practices and hygiene facilities still low)
 Information/data needs (better access to data, information, internet,
close digital divide)
 Forex (convertible currency for import of goods and services)
Needs of Developing Countries
Additional info on needs of developing countries:
http://unfccc.int/ttclear/misc_/StaticFiles/gnwoerk_static/events_SE-TEC-CTCN-
SB40/9af74e35f1804c85b9c1f757c312bcbb/5e18a86ef76a4f31aff21c3e6374bbbc.pdf

14. Hometown Student No.
1 Seoul > 56000
2 Beijing > 50000
3 Shanghai > 30000
4 Hyderabad
5 Riyadh
6 Mumbai > 17000
7 Taipei > 16000
8 Hong Kong > 12000
9 Kathmandu > 10000
10 Jeddah > 10000
Hometown of foreign
students enrolled in US
universities in 2008-2012
Source: http://www.brookings.edu/blogs/the-
avenue/posts/2014/09/18-global-hometowns-
americas-foreign-students-
ruiz#.VY2kStXqSBQ.facebook
Accessed: June 27, 2015

15. http://www.pewresearch.org/fact-tank/2017/11/20/new-
us-foreign-student-enrollment-doubled-since-great-
recession/ft_17-11-17_foreignstudent_trend/
Minister of Education in Australia: “In
2017, Australia hosted a record
number of international students as
more than 550,000 students from over
190 different nations flocked to our
shores”, an increase of 15% in the first
quarter of 2017, bringing the
applications for student visas from
94,000 in 2016 to 110,000 in the first
few months of 2017.
Figures Education Department show
there were 554,179 full-fee paying
international students in 2016, an
increase of more than 10 per cent on
the previous year.
The international students were from
China (30%), India (11%) and 4%
each from Malaysia, Vietnam and
Nepal, generating A$22.4 billion (£13
billion) in income for the Australian
economy.

16. Nepalese students contribute $1.6 billion to Australian economy (in 2017-18),
which is an increase of 55% than what they contributed in last fiscal year. This
figure does not include the expenses they made in rent payment, health insurance
payment, and other daily expenses. The students has contributed as cheap labor
for hundreds of Australian businesses, as per Dr. Anupam Pokharel, a Consultant
Psychiatrist in Australia.
In FY 2011/12, this figure was $567, and in FY 2016/17 it crossed the billion dollar
mark.
China: $ 11 billion, India: $ 3.7 billion, Nepal (third position); $ 1.6 billion.
December 2018: Number of Nepalese students: 43021, this is an increase of 51%
over 2017.
https://www.southasia.com.au/2019/05/11/nepalese-students-contribute-1-6-billion-to-australian-
economy/?fbclid=IwAR3_wJjvMV1PreFGpEppi79wjl7KpfcDJtXFeaYFpm5YadDbVkvR8u2ObAw
In the 12 months to October there were 65,746 enrolments from Nepal in tertiary
courses, according to the federal government, more than triple the 21,000 who
enrolled in 2016. In 2018-19 the Nepalese international student market was worth
$2.6 billion to Australia, up from $1.6 billion the previous year.
https://www.smh.com.au/national/it-s-just-abusive-experts-issue-warning-over-nepalese-student-surge-
20191219-p53lhm.html

17. “The Institute of International Education calculates that the nation of about
30 million people sent 8,920 students to U.S. colleges and universities in
the 2012-2013 school year, the latest for which data was available. That
makes Nepal the 14th-ranked supplier of international students to U.S.
campuses, just behind the United Kingdom (9,467) and ahead of Iran
(8,744).
China is the top supplier (235,597), followed by India (96,754). But Nepal
leads all four of those countries in the number of students per capita sent
to the United States.
The number of Nepalese studying in the United States rose from 2,411 in
1999-2000 to a peak of 11,581 in 2008-2009.”
Source: Howard U.’s Kathmandu connection: Nepal emerges as top
source of foreign students
By Nick Anderson August 27, 2014
http://www.washingtonpost.com/local/education/howard-us-kathmandu-connection-nepal-
emerges-as-top-source-of-foreign-students/2014/08/27/4cd70376-2a20-11e4-958c-
268a320a60ce_story.html
November 18, 2019—The number of international students in the US set an
all-time high in the 2018/19 academic year, The total number of international
students in the US in 2018 is 1,095,299. According to data from the U.S.
Department of Commerce, international students contributed $44.7 billion to
the U.S. economy in 2018, an increase of 5.5 percent from the previous year..
https://www.iie.org/Why-IIE/Announcements/2019/11/Number-of-International-Students-in-the-United-
States-Hits-All-Time-High

19. Foreign Direct Investment in Nepal (NPR, in million)
https://tradingeconomics.com/nepal/foreign-direct-investment
https://mofa.gov.np/wp-content/uploads/2018/12/Annual-Report-2017-18.pdf

20. Closing the development gap will depend on closing the
existing Science and Technology Innovation investment
gaps
Industrialised countries have been able to digest rapid
technological changes in past decades, but developing
countries are lagging behind.
The 3.5 per cent (of GDP on R&D) figure is an
unrealistic target, not only because of financial
constraints, but also because developing countries lack
the long-term policies and institutions, both public and
private, needed to produce and make use of
knowledge.
http://www.scidev.net/global/technology/news/developing-
nations-urged-spend-on-science-
UN.html?utm_medium=email&utm_source=SciDevNewsletter&
utm_campaign=international%20SciDev.Net%20update%3A%2
020%20July%202015#sthash.ZVTAm13x.dpuf

21. Ways to fulfill the needs
Providing scholarship to deserving students to study (obtain training) abroad.
(effectiveness is questionable)
Facilitating students to go abroad for education: In 2071 BS, 30400 Nepalese
students got “no objection” letter from Ministry of Education for higher
study in foreign countries. This does not include those who go to India.
Sending government officials to be trained. (effectiveness not monitored)
Obtaining loans and grants from donor agencies and UN systems.
Technology transfer
Membership in disaster relief agencies, UN Aid
Loan from EXIM Banks, ADB, WB, IFC, IMF, AIIB
Bilateral agreements
Multilateral agreements
Grants from research agencies
Joint research, joint investment
FDI attraction
Promotional activities
Liberal towards INGOs
Promotional activities of Nepalese Missions in
2017; source: MoFA, Annual Report 2017-18

22. Who benefits more in the process of need fulfillment?
Average cost of providing a person Bachelor degree, counting from date of
conception: US$ 10808+ 284750 + 38430 (in 2018 market price; NPR 39958560 at 1
USD=NPR 120,); (conception-birth + up to high school + 4-yr degree)
Persons going to US for higher degrees only from Kathmandu: 2000 per year (based
on 2008-2012 data; in 2017-2018: 13270 Nepalese students enrolled in US
universities)
Persons going to US for higher degrees from Nepal (2200, assumed)
Persons retained in US after completion of higher degree: 2000
Annual Saving to US: US$ 665,976,000 (NPR 79,17,12,00000)
“ … foreign students can provide important economic benefits to their U.S.
metropolitan destinations… offering valuable skills to local employers. More
metropolitan leaders should emulate leading practices that capitalize on the
knowledge and relationships of foreign students to strengthen local economies
…”.
Source: The Geography of Foreign Students in U.S. Higher Education: Origins and Destinations, by: Neil
G. Ruiz
http://www.brookings.edu/research/interactives/2014/geography-of-foreign-students#/M10420
विदेशशने विद्यार्थीको नयााँ रेकर्च, एक महिनामै ७२९२ विद्यार्थी बाहिररए
२०७३ चैत ३ गते
http://www.bikashnews.com/2017/03/16/54272.html#sthash.NsCV2cTl.8rc8HpdL.dpuf
Student returnees and their reflection on contribution to Nepal: use of knowledge and skills, Anita
Ghimire and Kabin Maharjan, Migration and Development Journal, 2015, Vol.4, Issue 1,
https://www.tandfonline.com/doi/full/10.1080/21632324.2014.935148

23. Donors spent major portion of quake aid on int’l staff: Govt
KATHMANDU, June 16: The Ministry of Home Affairs concluded that the major
portion of the funds provided in the name of earthquake victims is spent by donor
countries and international agencies on their own staff. Altogether 4,521 rescue
personnel from 34 countries were mobilized after the 7.8 magnitude quake of April 25
See more at: http://myrepublica.com/politics/item/22836-donors-spent-major-portion-of-quake-aid-on-int-l-staff-
govt.html#sthash.5uMBzkTN.dpuf
Clash of Cultures in Bhaktapur
German government withdrew from a Euro 10
million project to restore monuments, schools
and streets in Bhaktapur destroyed by the
earthquake. The Germans wanted to ensure full
compliance with the rules of its banks on the
tendering process. Bhaktapur’s leaders didn’t
want to be told what to do when they felt
perfectly capable of carrying out their own
restoration. The main point of dispute is KfW’s
insistence that the reconstruction contracts be
open to a global tender process, int’l
consultants, and the possible use of modern
construction materials
June 1, 2018, Nepali Times

24. Developed-developing country partnerships: Benefits to developed countries?
Shamsuzzoha B Syed, Viva Dadwal, Paul Rutter, Julie Storr, Joyce D Hightower,
Rachel Gooden, Jean Carlet, Sepideh Bagheri Nejad, Edward T Kelley, Liam Donaldson & Didier Pittet
Globalization and Health volume 8, Article number: 17 (2012)
Developing countries can generate effective solutions for today’s global health challenges. This
paper reviews relevant literature to construct the case for international cooperation, and in
particular, developed-developing country partnerships. The results were two-fold: some articles
pointed to intangible benefits accrued by developed country partners, but the majority of
information pointed to developing country innovations that can potentially inform health systems
in developed countries.
https://globalizationandhealth.biomedcentral.com/articles/10.1186/1744-8603-8-17
https://kathmandupost.com/miscellaneous/2017/11/16
/nepali-students-enrollment-among-highest-in-us-
varsities
10th position in 2018; total no. 13270
https://np.usembassy.gov/number-of-nepali-
students-reach-highest-in-the-last-three-years/

25. Needs of developed
countries
Ways of fulfilling
the needs
Positive Effect on
CMDC
Negative Effect on
CMDC
Needs of developing
countries
Ways of fulfilling the
needs
Positive Effect
on CMDC
Negative Effect
on CMDC

26. Test Yourself. Answer these questions using different
resources. Suggest other questions to test yourself.
Chapter 3: Needs of Countries
• The developing and developed countries need each other to reduce the
global problem of increasing greenhouse gas emission. Suggest practical
and equitable ways to help each other in fulfilling this mutual need.
• The developed countries need natural resources from developing
countries, and the developing countries need foreign currency to fund
their infrastructure development projects. Which type of country
(developing and developed) benefits more in fulfillment of this need of
natural resources and foreign currency? Explain with examples related to
construction management in developing countries.
• How do the developed countries fulfill their need of raw materials from
the developing countries, and how do the need fulfillment methods affect
the CMDC?
• Describe the benefits obtained by the developing countries from the
developed countries.

27. Test Yourself. Answer these questions using different
resources.
Chapter 3: Needs of Countries
• Discuss the needs of the developing countries from the developed
countries. How are these needs fulfilled, and how are these needs
related to construction project management of developing
countries?
• The developing and the developed countries need each other for
further development. The need of which type of country
(developing or developed) is more than the other type of country?
• Discuss the needs of the developed countries from the developing
countries. How are these needs fulfilled, and how are these needs
related to construction project management of developing
countries?
• Billionaire Bill Gates recently wrote that the Overseas Development
Assistant (ODA) is highly beneficial to the USA. Do you agree? Explain with
reasons/examples.

28. • WHAT CONSERVATION AID?
• The forestry and conservation sector is flush with foreign aid and little result.
Donors have ploughed over 120 million dollars in community forestry alone
since 1980. The new forest resource assessment in Nepal, supported by
Finland has a budget of about 5.5 million euro but about 4.4 million euro will
be spent directly or indirectly on consultants and logistic support. In this
regard, INGOs are creating employment for the foreign consultant. In many
cases, the highly skilled manpower of the nation is ruled by the low‐skilled
international manpower. Most of the conservation projects cater to the
interests of aid handling groups and the intended recipients are either the
workers getting low wages, unpaid facilitators and/or a good audience. The
government officers who are paid by the government are rushing to the
projects and ministry officials make a beeline for the departments that attract
foreign aid. REF# 94
• http://www.resourceshimalaya.org/content_files/2010NepalHimalaya_sAnUm
An4dce1f5b53ac5.pdf