Introduction
‘Third world’ refers to economically weaker nations. ‘Third world’ countries are generally represented by lack of basic infrastructure facilities, high poverty, and economic instability. Third world countries are behind the first world and second world countries, but ahead of the fourth world countries. Third world countries generally consist of the developing countries of Asia and Africa.
Significance of Third World
1) The term ‘Third world’ was coined on the basis of economic segmentation of the world.
2) The classification of countries into ‘First’, ‘Second’, ‘Third’ and ‘Fourth’ happened during the cold war, which existed from the year 1945 to approximately the 1990s.
3) Countries are generally characterised based on their economic status and other key economic indicators, such as employment growth, Gross Domestic Product (GDP), GDP growth, and rate of unemployment. ‘Third’ world countries lag behind in most economic indicators in comparison to ‘First’ and ‘Second’ world countries.
4) The low growth in ‘Third’ world countries is also characterised by poor infrastructure, lack of sanitation and healthcare facilities, low level of education, and inadequate standards of living.
5) ‘Third’ world countries carry tremendous opportunities for growth. Many investors, especially from the ‘First’ and ‘Second’ world countries target ‘Third’ world countries for their potential for high growth and high returns, in spite of high risks. ‘Third’ world countries are ground for potential growth. Innovations and industrial breakthroughs can enable significant improvements in a short span of time.
Conclusion
‘Third’ world countries are closely watched by the World Bank and International Monetary Fund (IMF) for infrastructure improvements and providing developmental aid to their economy. The ‘Third’ world categorisation is no longer relevant.
Presently, countries are categorised into one of the three general categories, namely developed, emerging, and frontier. The developed countries are the most industrialised. The emerging countries show signs of economic growth. The frontier countries closely resemble ‘Third’ world countries. They include Croatia, Estonia, Lithuania, Serbia, Nigeria and so on comprised in the Frontier markets list.
