Commentary
Regulation, not embargo, allows Beijing to shape how other countries and firms adapt to its terms.
Alvin Camba
{
"authors": [
"Uri Dadush",
"Shimelse Ali"
],
"type": "other",
"centerAffiliationAll": "",
"centers": [
"Carnegie Endowment for International Peace"
],
"collections": [],
"englishNewsletterAll": "",
"nonEnglishNewsletterAll": "",
"primaryCenter": "Carnegie Endowment for International Peace",
"programAffiliation": "",
"programs": [],
"projects": [],
"regions": [
"North America"
],
"topics": [
"Economy",
"Trade"
]
}
Source: Getty
Other
The Transformation of World Trade
Developing countries already play a substantial role in world trade, and their significance is only expected to rise. As they diversify and grow as export markets, emerging economies will come to dominate international trade.
Published on Apr 21, 2010
Developing countries are growing rapidly, and long term projections suggest that their rising economic weight will transform world trade. As these emerging economies diversify and become increasingly important export markets, they will come to dominate international trade.
Key Conclusions
- This phenomenon is characterized by three trends in developing countries: the diversification of exports into a wide range of manufactures, the emergence of a large Global Middle and Rich (GMR) class, and increased financial integration.
- As wages, education levels, and ratios of capital to labor in the most successful developing countries rise closer to those of advanced economies and faster than those in the less successful ones, existing patterns of comparative advantage will be redrawn.
- The transformation of world trade will present new challenges and opportunities. In order to reap the new opportunities, the poorest and most commodity-dependent countries will need to make sustained efforts to improve their business climates. Advanced countries will also have to retain their edge in innovation and product differentiation.
- While domestic reforms are key, international rules will have to be strengthened to make trade more open and predictable.
About the Authors
Uri Dadush
Former Senior Associate, International Economics Program
Dadush was a senior associate at the Carnegie Endowment for International Peace. He focuses on trends in the global economy and is currently tracking developments in the eurozone crisis.
Shimelse Ali
Carnegie does not take institutional positions on public policy issues; the views represented herein are those of the author(s) and do not necessarily reflect the views of Carnegie, its staff, or its trustees.
More Work from Carnegie China
- Today’s Rare Earths Conflict Echoes the 1973 Oil Crisis — But It’s Not the Same
- How China’s Growth Model Determines Its Climate PerformanceCommentary
Rather than climate ambitions, compatibility with investment and exports is why China supports both green and high-emission technologies.
Mathias Larsen
- What’s New about Involution?Commentary
“Involution” is a new word for an old problem, and without a very different set of policies to rein it in, it is a problem that is likely to persist.
Michael Pettis
- The Chinese Investment Riddle: What Cities RevealCommentary
While China's investment story seems contradictory from the outside, the real answers to Beijing's high-quality growth ambitions are hiding in plain sight across the nation's cities.
Yuhan Zhang
- Using China’s Central Government Balance Sheet to “Clean up” Local Government Debt Is a Bad IdeaCommentary
China's stimulus addiction cannot go on forever. Beijing still has policy space to clean up the country's massive debt issue, but time is running short.
Michael Pettis
