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Developing world’s share of trade increasing

Paul Staines writes:

New data shows that the developing world’s share of global trade has surged to a 50-year peak. Rising oil and commodity prices coupled with vigorous global trade growth meant developing countries saw their share in world merchandise trade rise sharply in 2004 to 31%, the highest since 1950, according to WTO figures released this morning.

The data provides clear evidence that trade liberalisation continues to play a growing role in economic activity and is increasingly important for development and poverty alleviation. More countries are engaging in international trade and participating more actively in setting and negotiating trade rules.

Just like with India and Hong Kong, trade liberalisation is key to African prosperity. If we truly want to Make Poverty History, the world needs free trade – not protectionism.

6 comments to Developing world’s share of trade increasing

  • Verity

    ” … developing countries saw their share in world merchandise trade rise sharply in 2004 to 31%, the highest since 1950, according to WTO figures released this morning.”

    Good! This proves it! Quit pouring trillions of Western taxpayer dollars into the giant maw of Africa’s ruling classes. Open the gates for free trade and watch human ingenuity and self-interest gallop in. Everyone wants to elevate himself and his family and it is appalling and disgusting that the West has been keeping them out of the game. Free trade is the key to human prosperity for all. Keeping Africa’s producers out of the rich markets of the West to protect Western growers and maintain the CAP is wicked beyond belief. Let them in to try their hand!

  • Wild Pegasus

    New data shows that the developing world’s share of global trade has surged to a 50-year peak. Rising oil and commodity prices coupled with vigorous global trade growth meant developing countries saw their share in world merchandise trade rise sharply in 2004 to 31%, the highest since 1950, according to WTO figures released this morning.

    This isn’t a positive development, really. Rising commodity prices is probably temporary unless we’re running into a shortage. No one wants that. As soon as commodity prices fall again, the undeveloped world loses out again. How much that figures into the other figures in the linked report, I don’t know.

    - Josh

  • Della

    Reading the original paper either there has been a vast increase in commodity flows around the world in most areas of the world in the 2003,2004 period or their 2003,2004 statistics are misleading. I checked whether the statistics are accurate and they seem to be.

    I then pondered whether there was a huge sea change in global trading that nobody had told me about. Having dismissed this as unlikley I though of other reasons why the numbers for those years were so high, I figure it’s pretty much got to be a collapse in the real value of the US dollar creating a statistical artifact of hugely increased world trade in US dollar terms.

    Looking at for example Brazil it’s exports grew 21% and 32% in 2004 and 2005, however it’s economy grew by 0.5% and 5.1% in real terms, looking at Germany it’s export growth is 22% in 2003 and 2004, however it’s economy grew by 0.4% and 2.0%.

    So while the export numbers say Brazil and Germany (and practically everywhere else) should be supercharged super high growth economies the countries growth rates say otherwise (and Brazil and Germany have 12% unemployment). So the export numbers must be very misleading.

    The only way I would be shifted from the position that this must be an artifact caused by a fall in the value of the US dollar is if someone were to come up with figures showing the tonnage of goods shipped had dramatically changed.

    In conclusion I predict that since the inflation figures in the USA for those two years were not particularly high then I think that the US has a bought of high inflation in it’s future. Of couse some things seem to have inflated already, oil, gold etc.

  • Della

    Another thing about that document. The share of the developed worlds exports of merchandise is increasing but apparently mostly at the expense of the US, the UK and Canada the value of whose exports dropped quite a lot in real terms (because they didn’t grow as much as most others).

  • veryretired

    Government aid programs have distributed uncounted billions of dollars around the world. Big projects, big ideas, big budgets, big beaurocracies, big bribes (disguised as consulting fees), big waste of money.

    My personal favorite was a cement plant that was the centerpiece aid project in an African country back in the ’70′s and ’80′s—construction went on for year after year, finally consuming 2+ billion dollars, before the whole thing was abandoned. No cement was ever produced. No one could ever figure out what happened to all the money. It just disappeared—wink, wink.

    Meanwhile, some greedy capitalists decided that people could actually perform useful work in various underdeveloped places if a factory was constructed for business reasons, by business people, and operated along business principles. Ireland is one good example, so I am given to understand, and there are many others.

    Of course, this development was greeted by all manner pf protest and pious condemnation by the usual suspects who bewail anything that involves (shudder) private enterprise and the profit motive.

    Oddly enough, countries that have allowed this type of investment, viscious exploitation though it may be, seem to have that much sought after social effect—the beginnings of a middle class which is employed, pays taxes, builds schools, houses, and medical clinics, and can afford little luxuries like motorbikes, TV’s, and such.

    Even more oddly enough, these pesky workers start to complain about such things as corruption, repression, lack of rights, and other ideas that seem to have infected them as they use those radios, TV’s, cell phones, and home computers, that put them in touch with the rest of the world. (See China, for a start)

    Those on the left and right, who are desparate to stop this development and regain their priviledged positions in the little closed societies they used to be able to control, can hold their breath and stomp their little feet and huff and puff all they want.

    You can’t keep ‘em down on the farm any longer. They’ve seen Paree, and they’re not going back to the village to live in a hut, in darkness, and watch their children die.

  • John Rippengal

    This may appear a pedantic point but it is not correct to talk of liberalisation of trade in Hong Kong and compare this with the Indian case. Hong Kong always had NO trade barriers or tariffs; it did not have to be liberalised. It followed Singapore where the genius of Stamford Raffles turned this malarial swamp into one of the most successful trading posts in the world. He had no taxes on trade and outflanked the Dutch colonial port of Bencoolen which was already well established but where the merchants had to pay to conduct their business.