After decades of economic stagnation due to corrupt rule and an ineffective import-substitution industrialization strategy(ISI), a democratic revolution has brought you to power as Prime Minister of the North African state, Saudi Garethia. Having the charisma to lead, the connections to manage, and the educational background in development economics necessary to effectively govern, you are confident that you can bring your country out of underdevelopment and turn it towards the path to prosperity.
Your primary responsibility is to restructure the economy by creating a sound development strategy for the next twenty years. To do so, you must use lessons from past examples of countries that successfully developed as well as make a logical assessment of the possibilities based on your country’s natural resources and its position in the international economic system. You very much desire the assistance of the United States and will also generate a list of specific requests to deliver to the US President.
You inherit a situation with particular political economic advantages and disadvantages. Saudi Garethia is about the size of Texas with a population of 60 million people, roughly half of whom are under age twenty-five. Unemployment is high at 32%. Your GDP/capita (PPP) last year was $8300. $6.8 billion is owed in external debt.
Until now, your chief industries have been agricultural—wheat, barley, olives, dates, citrus, vegetables, peanuts, soybeans, and cattle have been your main products. Your services industry remains small and corruption is rampant. However, geologists have discovered medium-sized oil deposits in the south-western region of the country last year, though they remained unexploited to date.
The United States supports your desire to enter the global market and is willing to provide loans via the World Bank for your economic development, though such loans will, of course, come with certain conditionalities. Major states are also willing to encourage foreign direct investment in Saudi Garethia, and to support your application for WTO membership. Finally, Saudi Garethia has been invited to join the OPEC oil cartel.
Based on these above factors, you must write a detailed development strategy that incorporates evidence from countries that have successfully developed in the past. You must explain the following:
a) Why ISI has been a failure in Saudi Garethia, as well as which country or countries’ strategies you will be modeling your development plan on. Be sure to describe that development plan in detail.
b) How you would ideally adapt the strategy you are modeling your plan on to suit Saudi Garethia’s unique conditions, including an ideal set of international economic agreements (regarding trade, possible loans, membership in international organizations, etc.).
c) An assessment of the likely barriers to development, both domestically and internationally.
d) The specific actions you will request from the United States in support for your development plan.
You have received this development scenario in advance and will be allowed to use a one page (double-sided) set of notes to assist you in writing out your development strategy. It should not be a formal essay. Instead, it should introduce the scenario and then follow the organizational structure detailed above in a series of integrated paragraphs. It must use specific evidence, show strong critical thinking, and be well written. The assessment rubric is in the study guide.