Developing Countries and World Trade: Performance and Prospects
Edited by Yilmaz Akyuz
Publisher:UNCTAD, Third World Network and Zed Books
Year Published:2003
No of Pages: 164
Price: US$12.00 (First World); US$9.00 (Third World). Please add 30% to price of book for postage cost by air mail.

Increased participation in world trade is conventionally seen as the single most important key to rapid economic growth and development.  This book is an up-to-date, statistically detailed, and analytically nuanced examination of the evolution of world trade over the past twenty years-by both categories of products and the varying participation patterns of different developing countries, including paying special attention to China which has just joined the WTO. Undertaken under the guidance of UNCTAD's chief economist, one startling conclusion from the analysis is that, while developing country exports have grown faster than the world average, and include a lot of manufactured goods, the developed countries have actually increased their share in world manufacturing value added over this period.  At the same time, developing countries' share in world manufacturing value added over this period has lagged considerably behind their share in world exports of manufactures.

The combination of increased competition among developing countries to attract foreign direct investment as locations for labour-intensive processes, crowded markets for labour-intensive manufactures, weak growth and protectionist inclinations in  the advanced industrial countries can mean that  what might be good for an individual exporter  might  not be good for all  exporters.  Thus, the fallacy of composition long suffered by the primary producers may also become a significant danger for the producer of labour-intensive manufactures in the South.

This analysis poses the vitally important policy challenge of what developing countries, confronted by the vigorous expansion of their foreign trade but no comparable rise in income, should do.  The book warns that  the key challenge confronting developing countries today is not more trade liberalization on their part, but improving the terms of their participation in trade and increasing the still limited and  unstable  benefits they derive from it.  This requires not just getting developed countries to change their commercial policies that limit access to their markets, but renegotiating with transnational corporations the highly skewed distributions of gains from trade and investment, and enlarging their policy space in technological upgrading.



Preface by Rubens Ricupero, Secretary-General of UNCTAD

Chapter 1


A.    Introduction
B.    Dynamic products in world trade
C.    Factors contributing to trade expansion in different products
      1.    Income growth and demand
      2.    Market access
      3.    International production networks
D.    Export dynamism and the potential for productivity growth
E.    Variations among developing countries
F.    Exports, industrialization and growth
      1.    International production networks, trade and industrialization
      2.    Trade in manufactures, value added, and growth
G.    Conclusions

Annex 1.A         Growth and classification of world merchandise exports
Annex 1.B         United States trade prices and dynamic products
Annex 1.C         International production networks and industrialization in developing countries


Chapter 2


A.    The issues at stake
B.    The terms of trade of developing country exports: a review of the evidence
C.    Competition in world markets for labour-intensive manufactures
D.    Skill profile of world trade and shifts in competitiveness
E.    Tariff barriers to exports of labour-intensive manufactures
      1.    Barriers in multilateral trading arrangements
      2.    Preferential trading arrangements and market access
F.    Policy responses


Chapter 3


A.    Introduction
B.    Accession: changes in China's import regime
      1.    Tariff and non-tariff measures (NTMs)
      2.    Subsidies
      3.    State trading and non-discrimination
C.    Industrial structure, trade and employment
      1.    Trade liberalization, public enterprises and employment
      2.    Foreign direct investment, employment and trade

D.    Trade prospects
      1.    Costs, competitiveness and market penetration
      2.    Competition with other developing countries
      3.    China's imports from developing countries
E.    Conclusions: managing integration


List of tables

1.1   Export value growth and share in total exports of the 20 most market-dynamic products, 1980-1998
1.2   Shares of main exporters and of developing economies in world exports of the most market-dynamic products, 1998
1.3   Shares of main exporters and of developing economies in world exports of the most market-dynamic agricultural       commodities, 1998
1.4   Structure of exports by product categories according to factor intensity, 1980 and 1998
1.5   Share of selected regional groups and developing economies  in world exports of manufactures and manufacturing       value added, 1980 and 1997
1.A1  SITC product groups: average annual growth of export value, 1980-1998, and classification according to factor intensity
1.A2  Leading market-dynamic products by exporting region, ranked by average annual export value growth, 1980-1998 1.C1  Bilateral trade in apparel and clothing accessories between selected trading partners, 1980-1998
1.C2  Bilateral trade in parts of computers and office machines between selected trading partners, 1980-1998
1.C3  Intraregional imports of the automobile industry: MERCOSUR and AFTA, 1980-1999
2.1   Manufactures with the lowest market concentration in world trade, 1997-1998
2.2   Simple MFN average tariffs of selected economies, by product group
2.3   Import-weighted MFN average tariffs of selected economies, by product group
2.4   Effectively applied average tariffs of selected countries in MERCOSUR and AFTA, by product group
2.5   Intraregional imports of MERCOSUR and AFTA, 1980-1999
2.6   Clothing and footwear imports of the European Union and the United States and related import-weighted tariffs, by       region, 1990-1999
3.1   Post-accession reduction in weighted tariff rates for China's main imports
3.2   Simulation results for the impact of post-accession tariff reduction on output, employment and import/output ratio in China, by sector, 1997-2005
3.3   Regional composition of China's external trade, 2000
3.4   Wages and unit labour costs in manufacturing: comparison between China and selected developed and developing      economies, 1998
3.5   Hourly labour costs in the textiles and clothing industries: comparison between selected developed and developing       economies and China, 1998
3.6   China's position in world trade in its main export products  (average, 1997- 1998)
3.7   China's position in world trade in its main import products (average, 1997-1998)
3.8   Shares of selected economies and regions of origin in China's imports, by major product group, 1999

List of charts

1.1   Share of trade among developing countries in their otal exports, by major product group, 1975-1999
1.2   Composition of merchandise exports from developing countries, by major product group, 1973-1999
1.3   Growth of exports of different classes of goods, by factor intensity, 1980-1998
1.4   Market dynamism of internationally traded goods, by factor intensity
1.5   Market dynamism of developing country exports, by factor intensity
1.6   Trade in manufactures and value added in manufacturing for selected groups of economies, 1981-1996
1.7   Trade in manufactures and value added in manufacturing of selected developing economies
1.B1  United States import and export price indices for selected electronics products, 1980-2000
2.1   Market concentration in major world export items, 1980-1998
2.2   Share of selected developing countries and regions in world clothing exports, 1980-1998
2.3   Share of selected developing countries and regions in exports of electronic products, 1980-1998      
2.4   Skill composition of adult population participating in world export production, 1975-2000
2.5   Regional skill composition of adult population, relative to world average skill composition in export production, 1975-2000

List of boxes

1.1   Skill and technology intensity of products and their  potential for productivity growth
3.1   Effects of trade liberalization on the automotive industry
3.2   Textile and clothing industries in China: the impact of liberalization