1887

Marginalisation of LDCs and Small Vulnerable States in World Trade

image of Marginalisation of LDCs and Small Vulnerable States in World Trade

There are indisputable concerns over the ineffective participation of LeastDeveloped Countries (LDCs) and Small Vulnerable Economies (SVEs) in the process of global integration, and their failure to derive benefits from the ongoing process of trade liberalisation and globalisation. This paper explains the theme of 'marginalisation' of LDCs and SVEs in the international trade arena, and their declining relative importance in world trade. Statistical analysis is used to determine the longterm declining share of LDCs and SVEs in world merchandise exports. The study argues that the process of marginalisation of these countries is mostly the result of the failure of LDCs and SVEs to diversify from their static comparative advantage related to the production of primary products, the significance of which in world trade has declined considerably during the past decades. The analysis emphasises the need for diversification of exports and an expansion of the manufacturing export base in these countries.

English

.

Implications for Long-term Trade and Development

While dependence on primary products and increasing globalisation in the world economy can explain much of the general trend in declining relative significance of LDCs and small states, there are other factors that aggravate the process, either by inhibiting or by not facilitating the development of dynamic export sectors. The long-term trade and development prospects of LDCs and small states hinge critically upon the interplay of these factors and without addressing them the process of marginalisation cannot be checked. This paper concludes, therefore, with a brief discussions of these issues.

English

This is a required field
Please enter a valid email address
Approval was a Success
Invalid data
An Error Occurred
Approval was partially successful, following selected items could not be processed due to error