001 - Financial Flows

Syllabus Point

Examine (AO3) the importance of loans, debt repayment, development aid, remittances, foreign direct investment and repatriation of profits in the transfer of capital between the developed core areas and the peripheries.

Examine (AO3) the influence of governments, world trading organisations and financial institutions (such as the World Trade Organisation, International Monetary Fund and World Bank) in the transfer of capital.

Key Terminology

      • Examine
      • Loans
      • Debt repayment
      • Development Aid
      • Remittances
      • Foreign direct investment
      • Repatriation of profits
      • Core
      • Periphery
      • Trade deficit
      • Rostow's Model of Development

Define the words below using your 'Geography Course Companion' text book by Nagle and Cooke or 'Global Interactions' text book by Guinness, the 'Command Word' posters in the classroon and the useful links below.

Useful Links

Taken From: http://www.gcsegeography.co.uk/_/rsrc/1392380955477/people-and-the-planet/development-dilemmas/the%20rostow%20model.png?height=727&width=1350

Activity One - Research

You will be divided in to small teams to investigate the impact that loans, debt repayments, development aid, remittances, foreign direct investment and repatriation of profits have on the transfer of capital between core and periphery areas. You will produce a 5 minute presentation and a hand out summarising your findings (the hand out can be as simple as a table). As the command word is examine you will need to provide a balanced argument between positive and negative factors but ultimately you need to come to a clear conclusion.


  • Oral presentation no more than 5 minutes.
  • Needs to focus on the positive and negatives.
  • Examples are crucial for HL students.
  • To share all the information easily between the group you need to develop your hand out in a google doc.

Useful Resources

Financial Flows

Forbes - Trump's Profit Repatriation Tax Break

Pages 57 - 66 in the 'Global Interactions' textbook by Guinness.

Taken From: http://ecx.images-amazon.com/images/I/51poy8y4ItL._SX395_BO1,204,203,200_.jpg

Activity Two - Comprehension

The second syllabus point for financial flows asks you examine how a number of institutions, both governmental and non-governmental, transfer money across the globe. Answer the following questions using the 'Global Interactions textbook by Guinness pages 66 - 70 to explore the importance of these institutions.

  1. How do National Governments exert their authority on others?
  2. How do National Governments influence the transfer of capital?
  3. Is the power of Nation States becoming less influential? Explain your answer.
  4. When did the International Monetary Fund and the World Bank first come into development?
  5. Why did the IMF and World Bank begin?
  6. What is the role of the IMF?
  7. How does the IMF get its money? What is the downfall of this approach?
  8. Why do countries apply for funding from the IMF?
  9. Are there any conditions imposed on loans from the IMF? If yes, what are they?
  10. How does the World Bank work? Make sure you mention the the International Development Association.
  11. Why is the World Bank criticised?
  12. What is the WTO and what is its primary purpose?
  13. Outline the successes of the WTO.
  14. What are the criticisms of the WTO?

Example Exam Question

Using examples, explain how financial flows transfer wealth between places. (10 marks)

Google document