INFLATION IN THE UNDERDEVELOPED COUNTRIES

[karanggatak]

in my opinion if third countries or poor countries do not sell their natural resources out of the country it will make the economy of third countries will get worse. and in my opinion what causes third countries to experience inflation is too much debt, the weakness of the national currency against the US dollar and too many imports and also many cases of corruption worsen the country's economy. in my opinion to prevent inflation a country must increase exports from imports and also reduce its debt.

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[abhiseshakana]

I wonder if new crypto payment system in their country will solve existing problems.
I mean it is actually harder for corruption to exist in it, but its still possible.

For the case of Venezuela, the adoption of bitcoin and other cryptocurrencies is due to TINA (there is no alternative). Decades of Venezuela have often taken the policy of devaluing bolivars to turn the wheels of the economy.

But when America dropped a total economic embargo on Venezuela, this made cryptocurrency and bitcoin the only way out to protect the value of their assets. The question is whether the adoption of bitcoin brings improvements or solutions to the problems facing Venezuela. Is the adoption of bitcoin and crypto can be interpreted by resetting the system and return to zero. The answer is no.

Learning from the case of Venezuela, the government must be proactive to detect crises and find the root causes of crises and find a formula to avoid crises. even if they have been trapped in a wave towards crisis, at least they can make a formula so that the impact is not painful for the state, corporations, and citizens.

[abhiseshakana]

You can't blame the countries themselves in particular, but those running it for putting their own country on the ground. One of the recent events is the countries that fell into the Chinese debt trap that led China to control its own country's assets from their unpaid loans.

Do you mean that Zimbabwe has to adopt China's currency (Yuan) after failing to pay the debt to China?

If these countries are wise enough not to recognise China's terms, this would not really happen.

But on the one hand, only China offers help. The example of Zimbabwe was shunned by European countries due to human rights problems. The offer from China was immediately taken because at that time many mouths had to be fed and a starving stomach.

The Chinese strategy in Africa with the One Belt one road (OBOR) program is a duplication of American policy when siphoning China's national wealth assets when the US moved its industry to China in 1990 to 2000. But China modified its American strategy by making long-term binding so that Africa could not be separated from the grasp of China. America at that time forgot to bind China so that China did not depend on America but instead dared to challenge America.

China is carrying out massive infrastructure development in Africa, especially manufacturing that processes semi-finished goods into finished goods. Maybe for China and some people this is an exploitation. but for some Africans, despite the prejudice of exploitation, at least Chinese investment in Africa opens up opportunities for the wheels of the economy, which means that the opportunities for African people to get jobs are even greater.

Many underdeveloped countries are making mistakes by overprinting their own fiat currency in their process. If only the government is wise enough, they realise that printing more money is not the solution to anything.

I agree with you because it is in accordance with the Equation of exchange (https://en.wikipedia.org/wiki/Equation_of_exchange)

M x V = P x Q

M = Total Money Supply
V = Velocity of money
P = Price Level
Q = index of real expenditure


The equation above illustrates the relationship between the amount of money in circulation and the total expenditure of final goods and services produced by a country's economy. If the additional money supply is higher than the real GDP, the price level will generally rise

So the process of increasing the money supply will be better done when the economic level has increased so that there will still be a balance between the amount of money in circulation and the total value of goods/services.

[Wexlike]

You can't blame the countries themselves in particular, but those running it for putting their own country on the ground. One of the recent events is the countries that fell into the Chinese debt trap that led China to control its own country's assets from their unpaid loans. If these countries are wise enough not to recognise China's terms, this would not really happen. Many underdeveloped countries are making mistakes by overprinting their own fiat currency in their process. If only the government is wise enough, they realise that printing more money is not the solution to anything.

On the other hand, we have the new fiat money called "Eco" which is introduced by the following countries:

Benin, Burkina Faso, Ivory Coast, Guinea-Bissau, Mali, Niger, Senegal and Togo

This money will be controlled by the ECB. So there is no place for China's interventions anymore.

[redsun114]

There are ways that the government can control inflation and the government of these developing countries should also apply those same methods to fight inflation, but the funny thing is that they wouldn’t, because they don’t care, they only care about their selfish needs and they are part of the problems that their countries are facing, those in power are corrupt. Apart from the government, the rich citizens are also part of it.

Anyway, the ways that they can control inflation is through monetary policy, control of money supply, wage controls and fiscal policy. But like I said, they are not interested.

[zeingrind777]

Inflation occurs when the debt of their country mounting up and its same happening all over the world with no difference of developed or developing countries.Only way to reduce the inflation rate is to keep the economic steady so they no need to print more money to pay their debts.And also their economic should more depends on the export rather than importing in my opinion.

I agree. Economic inflation in a country is sometimes caused by their consumptive society buying imported goods rather than buying products from their own country. As a result, the value of their currencies will be weaker so that economic inflation occurs.

[andriarto]

Inflation occurs when the debt of their country mounting up and its same happening all over the world with no difference of developed or developing countries.Only way to reduce the inflation rate is to keep the economic steady so they no need to print more money to pay their debts.And also their economic should more depends on the export rather than importing in my opinion.

I agree. Economic inflation in a country is sometimes caused by their consumptive society buying imported goods rather than buying products from their own country. As a result, the value of their currencies will be weaker so that economic inflation occurs.

perhaps because imported goods are cheaper than the products of the country itself, so that domestic products are not sold and business actors are in difficult circumstances, so they need more foreign currencies. different from countries that export their products, of course the demand for fiat currencies in the country increases and can reduce inflation

[Karmakid]

In my honest opinion, the inflation in the underdeveloped countries are just the same as the other developing countries. It doesn't matter if a country is underdeveloped, developing or developed country because it all depends on the president or the leader that manages the country. Even a country is still underdeveloped but the president is a great leader then they can climb up into top spots of progressing country.

[zeingrind777]

Inflation occurs when the debt of their country mounting up and its same happening all over the world with no difference of developed or developing countries.Only way to reduce the inflation rate is to keep the economic steady so they no need to print more money to pay their debts.And also their economic should more depends on the export rather than importing in my opinion.

I agree. Economic inflation in a country is sometimes caused by their consumptive society buying imported goods rather than buying products from their own country. As a result, the value of their currencies will be weaker so that economic inflation occurs.

perhaps because imported goods are cheaper than the products of the country itself, so that domestic products are not sold and business actors are in difficult circumstances, so they need more foreign currencies. different from countries that export their products, of course the demand for fiat currencies in the country increases and can reduce inflation

It is true, the price of imported goods is always cheaper than local goods, but people should prioritize buying local products rather than imported products so that their country's economy can be more stable. And also the government in the country must provide full support for local producers including MSMEs.

[supercanada1]

Inflation occurs when the debt of their country mounting up and its same happening all over the world with no difference of developed or developing countries.Only way to reduce the inflation rate is to keep the economic steady so they no need to print more money to pay their debts.And also their economic should more depends on the export rather than importing in my opinion.

I agree. Economic inflation in a country is sometimes caused by their consumptive society buying imported goods rather than buying products from their own country. As a result, the value of their currencies will be weaker so that economic inflation occurs.

perhaps because imported goods are cheaper than the products of the country itself, so that domestic products are not sold and business actors are in difficult circumstances, so they need more foreign currencies. different from countries that export their products, of course the demand for fiat currencies in the country increases and can reduce inflation

It is true, the price of imported goods is always cheaper than local goods, but people should prioritize buying local products rather than imported products so that their country's economy can be more stable. And also the government in the country must provide full support for local producers including MSMEs.

One of the best way to make the economy of country stronger and stable is the promotion of its local products. Instead of importing things from other countries, under developed countries have to focus on the production and promotion of their own products. Governments should make the products of their own country easily accessible and purchasable for the citizens. This will make the economy of country stronger.

[deisik]

One of the best way to make the economy of country stronger and stable is the promotion of its local products. Instead of importing things from other countries, under developed countries have to focus on the production and promotion of their own products. Governments should make the products of their own country easily accessible and purchasable for the citizens. This will make the economy of country stronger

It doesn't work that way

In the modern world self-sufficiency (North Korea style) is a dead end. But you really don't need to be an Einstein to understand what makes the economy strong. The real way to get strong economically is to export something nobody else can produce but which everyone wants (e.g. the American dollar)

This gives you a competitive advantage, and if you have a lot of such goods, you are the king of the hood (in this case, of the whole world). Then you can choose among the bunch of producers whose goods you need to import, if at all. Put differently, export everything that is unique and import everything that is not

[abhiseshakana]

One of the best way to make the economy of country stronger and stable is the promotion of its local products. Instead of importing things from other countries, under developed countries have to focus on the production and promotion of their own products. Governments should make the products of their own country easily accessible and purchasable for the citizens. This will make the economy of country stronger

It doesn't work that way

In the modern world self-sufficiency (North Korea style) is a dead end. But you really don't need to be an Einstein to understand what makes the economy strong. The real way to get strong economically is to export something nobody else can produce but which everyone wants (e.g. the American dollar)

This gives you a competitive advantage, and if you have a lot of such goods, you are the king of the hood (in this case, of the whole world). Then you can choose among the bunch of producers whose goods you need to import, if at all. Put differently, export everything that is unique and import everything that is not

It will work.

Economic independence is the key to a country's progress and growth. Effective demand or the purchasing power of the people in the country must be the basis of economic growth. This means that the growth development strategy through equity or growth with equity-oriented domestically. The populace in the economic system emphasizes the importance of prioritizing the interests of the people and the livelihoods of many people, which is sourced from the people's sovereignty.

The truth is state development not development in a country. Poor and developing countries must consciously form a pattern of national production (pattern of production) based on domestic resources themselves. Avoid Manufacturing sectors that depend on foreign countries, become import-dependent. The high import contents in manufactured products, as evidence of the government not building an economy in accordance with our natural resources (resource-based), but there is the influence of the "import-business" skipper who has microeconomic interests, which often conflict with efforts to restructure the economy macro. Therefore, we still have to carefully distinguish between economic recovery efforts (the style of the IMF and neo-classical ones) and reformatory economic recovery (macro) which contains the aim of economic restructuring, namely overcoming structural imbalances.

Relying on state revenues from the export sector alone is disastrous, especially if there is a global economic slowdown and a weakening dollar. Domestic consumption but made into a country's macroeconomic fundamentals.

Poor countries do not want to only be a market for developed country products. There must be a joint movement for the benefit of citizens so that the economy can spin in poor countries. The views of developed countries towards poor countries are as follows: Poor countries do not mean they do not have the ability to buy. still have purchasing power, although it is weak compared to developing or developed countries. This country is what in the economic world is called the bottom of the pyramid (BOP). The amount is greater than developed countries.

With the consolidation of the bottom of the pyramid, poor countries can be independent. Action that can be done is to stop imports and start exploring domestic resources and capabilities. No need to grandiose to develop advanced infrastructure. It is enough to keep the money going in the country. As citizens, we can support government programs by loving and buying domestic products. Avoid shopping at supermarkets that are owned by foreigners. Always shopping at traditional markets around our area. So that money continues to revolve at the bottom of the pyramid, which in turn, prosperity and progress for the poor.

Learning from the American trade war against China, the ultimate goal is the independence of US manufacturing of Chinese products. Developed countries just try to be as independent as possible.

[TrevorS]

The issue is a lot more complex than most people might think. The first world countries perfected the art to pull the wool over third world countries heads, because they arrange trade agreements to favor them and they make sure that they extract as much raw resources as possible from these countries and then refine or manufacture goods from this raw material and then sell that at inflated prices back to those countries. <This offsets the import and exports between 1st world and 3rd world countries>

Some governments make bad political decisions and then 1st world countries would boycott them and this will hamper economic growth. The 3rd world countries are then forced to loan money to fund large infrastructure and development projects and the debt spiral will start pulling them down and they will start printing more money that would devalue their local currency.  

You are right this question is really more complicated than it looked initially. More developed countries have an extremely strong influence on less developed countries, which often have to dance to the tune of developed countries in order to maintain their economy at least at some level. Or for example, how the United States delivers products to Africa at low prices, completely killing the country's agricultural economy,
which is more expensive than buying cheap products from the United States. Thus, the United States provides its citizens with work depriving it of Africans.

[chip1994]

The world economy keeps crashing with many incidence of inflation. What is happening at the moment is  a clear indication of a world that has failed the minority. Although the underdeveloped countries could partly be blamed for the high inflation that exists in their respective economies. Would things turn around for good  if underdeveloped countries start to add value to their natural resources themselves without selling to the countries with good economy?

the worse the trade, the more a country will not be able to develop and will soon be outdated. I think trade is very important for any country that wants to thrive. But what about countries with poor resources like those in Africa? I think they should be more focused on technology and decentralized markets, because they can get rich with their intelligence without producing anything. There are quite a few rich people who rely on crypto trading, it seems that underdeveloped countries need the crypto market.

[huige007]

The world economy keeps crashing with many incidence of inflation. What is happening at the moment is  a clear indication of a world that has failed the minority. Although the underdeveloped countries could partly be blamed for the high inflation that exists in their respective economies. Would things turn around for good  if underdeveloped countries start to add value to their natural resources themselves without selling to the countries with good economy?

the worse the trade, the more a country will not be able to develop and will soon be outdated. I think trade is very important for any country that wants to thrive. But what about countries with poor resources like those in Africa? I think they should be more focused on technology and decentralized markets, because they can get rich with their intelligence without producing anything. There are quite a few rich people who rely on crypto trading, it seems that underdeveloped countries need the crypto market.

We should work on creating awareness among the people of underdeveloped countries about this development as it would be a huge advantage for them. Trading does not involve much effort it only need active participation. Let’s take initiative to help those who are in need do that they can also enjoy their life. If they will adopt this market it will surely benefit you also.

[GideonGono]

The world economy keeps crashing with many incidence of inflation. What is happening at the moment is  a clear indication of a world that has failed the minority. Although the underdeveloped countries could partly be blamed for the high inflation that exists in their respective economies. Would things turn around for good  if underdeveloped countries start to add value to their natural resources themselves without selling to the countries with good economy?

the worse the trade, the more a country will not be able to develop and will soon be outdated. I think trade is very important for any country that wants to thrive. But what about countries with poor resources like those in Africa? I think they should be more focused on technology and decentralized markets, because they can get rich with their intelligence without producing anything. There are quite a few rich people who rely on crypto trading, it seems that underdeveloped countries need the crypto market.

We have a limited resources but unstoppable growth of population so that was too hard to develop an underdeveloped country without resources because they will rely on another country if they want to become successful. That was not easy to growth crypto in the whole world because not all person havent any access to technology. That's why we can't say that crypto can burn down fiat soon.

[HarmonyA]

Inflation in the underdeveloped countries isn't principally a financial marvel. It is brought about by auxiliary disequilibrium in the country's economy and must be constrained by guaranteeing similarity among the different basic components of the national expenditure.

As yield increases after some time it wil l be fundamental to extend the cash supply so as to evade deflation, First, as nationa salary expands the requirement for cash for exchanges purposes wil l increment.

Second, as the economy creates the non-adapted part wil l de-wrinkle and the size of the adapted part will build; this wil l require an additiona l extension of the cash supply. Third , as incomes ascend there is a propensity for money adjusts to increment quicker than the pace of increment of genuine pet capita pay, I e, the cash income proportion rises.
The comhination of these three elements isn't likely to bring about a noteworthy development of credit, yet any further increment in the cash supply will he inflationary.

[TrevorS]

It is ridiculous that many currencies of developing countries are backed by the dollar, while the dollar itself, at the moment, is not backed up by anything.
Thus, inflation in a developing country is inevitable because it is under the direct influence of another economic system and a different currency.
If a collapse of the supply currency occurs, the native currency collapses with it. In addition, prices are constantly rising due to inflation and constant dollar cash injections into the economy.

[mamahdedeh]

It is ridiculous that many currencies of developing countries are backed by the dollar, while the dollar itself, at the moment, is not backed up by anything.
Thus, inflation in a developing country is inevitable because it is under the direct influence of another economic system and a different currency.
If a collapse of the supply currency occurs, the native currency collapses with it. In addition, prices are constantly rising due to inflation and constant dollar cash injections into the economy.

The fact is that the United States of America has learned to maintain the price of its national currency at the expense of a strong army and through lending to different countries.  The fact is that the United States lends at interest in dollars, and also carries out various trade operations also in dollars, and also supports with its army, as well as with the dollar, those countries in which the army is absent or has little force.  I believe that as long as the United States takes a leading position in the world, the USD will successfully occupy the place where it is today.

right, that is what is happening right now, but now too many countries have started to become usd free. for undeveloped countries, they choose crypto for their currencies which are not affected by inflation. even so, this step is actually risky too

[Subbir]

I think the inclusion within the countries involved is typically thanks to inflation This inflation is that the same in every country. If the currency inflation of a rustic increases an equivalent effect is altogether countries. the most explanation for inflation is that the rise of the currency within the country i do not think it's fair responsible anyone for this If the extent of development goes up currency inflation rises and if commodity prices rise thanks to political reasons the currency surplus is increased further It affects the economy of the country.