Skip to main content

How Are Country Classified in Economic Terms?



According to WORLD BANK, countries are classified on the basis of single criteria which is per capita gross national income (GNI). Accordingly, countries have been grouped as high-income( >US$12,535), upper middle income( US$4,046-US$12,535), lower middle income( US$1,036-US$4,045) and low-income( < US$1,036).

According to UN, countries are classified on the basis of 3 criteria viz per capita gross national income (GNI), Human Assets Index (HAI) and Economic Vulnerability Index (EVI). It classifies as Developed Country, Country in transition, Developing country and Least developed country.  

GNI is same as of world bank except the transition of Least Developed Country to Developing Country requires values greater than US$1230.

HAI is aggregate index of education and health which represents Human Capital. It combines 5 indicators; three indicators of HEALTH (Percentage of the population undernourished, Mortality rate for children aged 5 years or under and maternal mortality rate) and two indicators of EDUCATION (Gross secondary school enrollment ratio, Adult literacy rate). Each component of health carries 16.67% weight while the education component carries weight of 25% each. The normalized scores vary between 0 and 100 where the higher score represents higher development of human capital while low score corresponds to lower development of human capital. 



Economic vulnerability can be defined as the likelihood that a country’s economic development process is hindered by the occurrence of exogenous unforeseen shocks.The economic vulnerability is measured by the EVI which is composed of magnitude of shocks as well as the exposure to shocks. The magnitude of shock index is called SHOCK INDEX which comprises weighted average of 3 component indices viz victims of natural disasters, instability in agricultural production and instability in exports of goods and services. In similar fashion, the exposure of shock index is called EXPOSURE INDEX which comprises weighted average of  5 component indices viz population size, remoteness from world markets, exports concentration, share of agriculture, forestry and fisheries in GDP and share of population living in low coastal areas. As a result the arithmetic mean of shock index and exposure index makes up EVI. It is measured in the scale of 1-100 where high score represents high level of vulnerability while the low score corresponds to low level of vulnerability.




Since UN intervention from 1971-2018, out of 53 countries; only 5 countries have graduated before 2018 and 5 more country will be officially graduated by 2023 from LDC status to developing status.
  

CASE EXAMPLE OF STATUS OF NEPAL

As of 2020, Nepal which lies in South Asia; has graduated from the low income country to the low middle income country indicated by annual report of World Bank data of US$1090 GNI per capita against the graduation of US$1036. While the UN graduation which is triennial ceremony, requires to meet at least 2 out of 3 criteria as stated above in order to qualify from least developed country to developing country. According to last ceremony held in 2018, Nepal met the graduation requirement of HAI and EVI by over 5.2 and 3.6 points respectively while for GNI per capita fell short by US$485. Though Nepal met at least 2 criteria, Nepal government decided to decline the opportunity fearing the transition would significantly reduce the flow of foreign aid resulting deprivation of the country of other international support measures. Though Nepal aims to graduate into developing country by 2022.

Comments

Post a Comment

Popular posts from this blog

Paulownia

Name :    Nepali- Bodhsal  Japanese- Kiri  Otheers- Raajkumari/ Maharani birkshya Origin : China Biology: 60-70 Ft tall In spring, it flowers in blue and white colour for 1 month leaves are long and wide measuring up to 2 ft long  Stem is quite light(40x compared to other tress) and bit yellow in colour Variety: 17 var among which T omentosa  and F ortunei   are the fast growing(matures in 8-10 years) Growth: 1 year= 20-30 ft tall 5-6 years= 60-70 ft tall 8-10 years= Fully matures Economy (2016 Nepal): 1  tree yields 30-36 ft 3 wood 1 Ft 3 costs- Rs 15,000 1 tree will give us Rs 40,000- 60000 Cultivation: Cultivated upto 2100 masl Plants/ha—200  Uses: 1. wood is khadilo, kira nalagni, na mikkinay, na bangini, na pasaangrinay, na futni,   chadai na jalnii 2. Furniture,ships, toys, house, oil, wine, beer, fruits packaging, aeroplane gliders etc 3. After cutting up the wood, its dust i...
Post a Comment
Read more

Are you confused about Homoptera, Hemiptera and Heteroptera???

Old Concept: The order Heteroptera is divided into two sub order  1. Homoptera = Hopper, Cicada, Aphids, Scale Insects, Moss bugs 2. Hemiptera =  True Bugs Mid Concept{only i call it because its prevalent in my college (AFU)}: There are only two order Homoptera and Hemiptera. There is no such thing as Hetetoptera and sub order. New Concept( since 2012 ): There is single order Hemiptera which is divided into 4 sub-order 1. Auchenorrhyncha = Hopper, Cicada 2. Sternorrhyncha = Aphids, Scale Insect 3. Coleorrhyncha = Moss bugs 4. Heteroptera = True Bugs  Thus basically Homoptera includes Auchenorrhyncha, Sternorrhyncha and Coleorrhyncha but nowadays we dont say homoptera.  And hemiptera is changed to heteroptera. I know its bit confusing and it always will be because like every other biological classification, its ever changing. We still dont have the precise classification about anything whether its giant talking tree from LOTR or the ...
Post a Comment
Read more