Foreign aid, the Third World’s debt crisis and the implication for economic development: The Nigerian experience

Abstract

The nature of interdependence of nations necessitates granting of aid to needy countries. Theorists, however,
vary in their approaches of the factors that contributed to the development of the underdevelopment of the
Third World. While the bourgeois scholars argued that the underdevelopment and dependency situation of the
Third World was due to the internal contradictions of this group of countries arising from bad leadership,
mismanagement of national resources and elevation of personal aggrandisement and primordial interests over
and above national interest, the neo-Marxian scholars, on the other hand, submitted and insisted that what
propelled the development of the developed countries also facilitated, in the same measure, the
underdevelopment of the underdeveloped countries. These are: colonialism, slave trade and unequal
exchange. The interest of this paper, therefore, is to look at the two sides of the coin using dependency theory
to scientifically analyse the arguments put forth by both schools of thought. It also looks at leitmotif of foreign
loan and its implication on the economies of the Third World Countries (TWCs).