VJC econs 2019 Promo QP and SAMS

2019 Promo QP 41 H2 ECONOMICS – PROMOTIONAL EXAM 2019 QP Section A: Case Study Question [30m] Economic growth in Ethiopia and South Korea Chart 1: Real GDP growth rate (%) for Ethiopia Source: Federal Reserve Bank of St. Louis, Federal Reserve Economic Data Extract 1: Ethiopia is Africa’s fastest-growing economy Ethiopia has an image problem. For decades , the mere mention of the country has conjured up images of famine and conflict. But a new Ethiopia is emerging from troubled times and the latest International Monetary Fund (IMF) forecast says Ethiopia will be the fastest -growing economy in sub-Saharan Africa in 2018. Ethiopia’s rise has been largely driven by an increase in industrial activity, including investments in infrastructure and manufacturing. Much of the investment in Ethiopia has come from overseas , especially China. Ethiopia’s growth has been fuelled by Chinese firms building factories, bringing in new technology that raises labour productivity. Despite its high rate of growth, Ethiopia still has plenty of spare capacity. Adapted from World Economic Forum Regional Agenda, 04 May 2018 Extract 2: Ethiopia’s economic miracle is an environmental tragedy Ethiopia is doing all it can to attract foreign investors, with water and electricity almost free and rents at 10 percent of market rate. France’s Castel Group has established vineyards, a nd the Dutch multinational Afriflora Sher has set up the world’s largest ros e farm, employing 1,500 workers who earn US$83 a month. These companies pay nothing for water from the Bulbula river, which flows into Lake Abijatta. But the rural population and the environment are the biggest losers. More than half of Lake Abijatta has disappeared in the past 30 years, and fish have vanished because of the remaining water’s 0 2 4 6 8 10 12 14 2010 2011 2012 2013 2014 2015 2016 2017 2018

2019 Promo QP 42 increased salinity, as a result of the activities of these foreign businesses . The other lakes in the central part of the Great Rift Valley (Ziway, Shalla, and Langano) face the same threat. Two million people depend on Lake Ziway, the region’s only freshwater lake, but its level is falling relentlessly. Lake Ziway’s water quality is deteriorating, driving treatment costs up. Amdemi chael Mulugeta of the non-governmental organisation Wetlands International said, “At this rate, the water won’t be drinkable in a decade, and the lake will be gone in 50 to 70 years. The town of Ziway used to use lake water, but now purification would be too complex to be done locally and, above all, too costly.” Source: The Nation, 01 May 2019 Extract 3: Rising inequalities in South Korea Just a few decades ago, South Korea was seen as a model for achieving both growth and equity. In the past half-century, South Korea has gone from being one of the poorest societies in the world to an advanced industrialised economy. During the industrialisation p