Exports as an Engine of Growth
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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.
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Exports as an Engine of Growth
- 1. Exports as an ENGINE of growth – Critical Analysis XLRI Jamshedpur
- 2. 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…
- 3. ∗ 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…
- 4. ∗South Korea ∗China ∗Japan Exports led success stories…
- 5. ∗ 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…
- 6. ∗ Low import content in exports ∗ Fragmentation of production ∗ Foreign Direct Investment ∗ Focus on growth extensive products – ICT ∗ World class infrastructure China – the export dragon…
- 7. ∗ 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!
- 9. ∗ 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…
- 10. ∗ 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…
- 11. Beyond 2000…. ∗ Commodity boom ∗ Sharp currency appreciation ∗ Impact on export competitiveness ∗ Failure to invest in future growth areas Australia – The Dutch disease victim…
- 12. 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
- 13. Thank You!