Exports as an Engine of Growth
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Exports as an ENGINE of growth – Critical Analysis XLRI Jamshedpur
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This presentation is about the idea that whether Exports are considered engine for growth. I have presented both the sides of this idea in the presentation: for countries that took benefit of exports, and for the ones that did not.
Transcript of Exports as an Engine of Growth
Exports as an ENGINE of growth – Critical Analysis
XLRI Jamshedpur
Most important source of foreign exchange…Creates employment opportunities…Improves intra-industry trade…Speeds up country’s industrialization…Integrates the country with world economy…
Introduction…
Boosts economic growth – GDP & Per capita income
Improvement in overall infrastructure Efficient resource and capacity utilization Achieving economies of scale Technological advancement through competition
Exports and economic growth…
South KoreaChinaJapan
Exports led success stories…
1960s – export promotion policies initiated through subsidies 1960s – emphasis on labour intensive products 1970s – shift towards heavy and chemical industry products 1980s – fillip to R&D 1990s – focus on capital good industries and market reforms 2000 onwards – leader in high technology ICT products
South Korea – The miracle on the Han
river…
Low import content in exports Fragmentation of production Foreign Direct Investment Focus on growth extensive products – ICT World class infrastructure
China – the export dragon…
Battered after World War II Often called as “Economic Miracle” Govt. promoted large scale production Overwork culture Govt. introduced “Export Contest” to combine benefits of
competition and cooperation
Japan – the export Samurai!
MexicoPakistanAustralia
Export let downs…
1930s to 1980s – Strong protectionist trade policies 1980s – Inflation declining standard of living and debt
crisis 1990s – currency devaluation and NAFTA 1990s to 2008 – key exporter to USA 2008 onwards – economy takes a hit
Mexico – The long tail of North America…
One of the most Potential Economies in the 1960s along with South Korea
Political Instability and Corruption Lack of Vision towards Economic Growth Failed to Invest initially earned revenue
Pakistan – A growth story that never took off…
Beyond 2000…. Commodity boom Sharp currency appreciation Impact on export competitiveness Failure to invest in future growth areas
Australia – The Dutch disease victim…
Conclusion
Government Policies Government lacking vision
Strategic Focus Lack of Strategic focus
Laborious and focused workforce
Political Instability
Fragmentation & Diversification of
Production
Strong protectionist trade policies
Thank You!
