The resource curse reloaded: revisiting the Dutch disease with economic compl...FGV Brazil
Â
This paper shows that the Dutch disease can be more formally characterised as low economic complexity using ECI-type indicators; there is a solid and robust inverse relationship between exports concentrating on natural resources and economic complexity as measured by complexity indicators for a database of 122 countries from 1963 to 2013. In a large majority of cases, oil answers for shares in excess of 50% of exports. In addition to empirical panel analysis, we address case studies concerned with Indonesia and Nigeria and introduce a brief review of the theoretical literature on the topic. Indonesia is considered in the literature as a good example in avoiding the negative effects of the Dutch disease, whereas Nigeria is taken as a bad example in terms of institutions and policies adopted during the seventies and eighties. The empirical results show that complexity analysis and Big Data may offer significant contributions to the still-current debate surrounding the Dutch disease.
Date: 2017-03
Authors:
Camargo, Jhean Steffan Martines de
Gala, Paulo
The document compares economic development ideas from the 1960s and 1980s. In the 1960s, government played a central role in development through policies like import substitution. By the 1980s, government was seen as an obstacle, and private investment, trade liberalization, and foreign direct investment were emphasized instead of government borrowing. Development assistance also shifted from project loans to policy-based lending to encourage market-friendly reforms.
The document summarizes Ethiopia's industrial policies under the current EPRDF regime since 1991. It discusses how the regime has implemented policies to strengthen the economy through an export-led industrialization strategy. Some of the key policies discussed include the Industrial Development Strategy (IDS) from 2002-2003, which aims to promote labor-intensive and export-oriented industries. IDS utilizes four main tools - stabilizing macroeconomic variables like inflation; creating a business friendly environment; building infrastructure; and providing support to competitive industries like flowers. While these policies have achieved some success, Ethiopia still faces challenges like high inflation, lack of foreign investment, and weak logistics sectors.
The oil industry in Angola, though owned by the state, operates under a capitalist mode of production. While Angola's constitution declares natural resources as state property, profits from oil production are split between international companies and the state-owned Sonangol through production sharing agreements. Despite increased oil revenues, little has benefited the Angolan people, as seen by low human development scores and below-average public spending on healthcare and education. While measures aim to increase transparency, the oil industry remains dominated by capitalist relations between foreign firms and the government.
Examining the Impact of Export-Led Growth Strategy: Evidences From Nigeria (1...inventionjournals
Â
The Nigerian economy had for decades been dependent on the fragile leg of crude oil exports. An emerging trend however suggests that in the last ten years the economy was growing without job creation and poverty reduction consequent upon fall in the international oil markets. Expectedly, attention of scholars had shifted towards the development of non-oil exports as a substitute for this quagmire. This study analyses Export-Led Growth Strategy in Nigeria using Annual Data between 1960 and 2015. The study adopted the Autoregressive Distributed Lag (ARDL) Approach on a modified Cobb Douglass Production Function in the analysis. The choice of ARDL is informed by many considerations: it can be used irrespective of whether the regressors are I(1) or I(0) or a mixture of both. Results of the findings revealed that oil exports are directly related to GDP while non-oil exports are not, and implacably non-oil exports do not impact on GDP. The study also revealed that there is a long run relationship between GDP and both components of exports (oil and nonoil) which can be used to determine the possible direction of GDP. And in case of distortion in the economy, equilibrium can be restored at 12 per cent growth rate per annum as one of the study revelations. The study among others recommends that government should diversify the economy to ensure maximum contributions from all facets of the same to enhance economic growth of the country.
Foreign trade and economic growth in nigeria (1980 2010)Alexander Decker
Â
1. The document discusses foreign trade and economic growth in Nigeria from 1980-2010. It analyzes how foreign trade has impacted Nigeria's economy and growth over this period.
2. Nigeria traditionally relied on agricultural exports like cocoa, palm oil, and groundnuts, but since the 1960s oil has dominated exports. Oil exports now account for over 90% of total exports.
3. While foreign trade can promote growth, Nigeria still faces economic instability and import dependence. The heavy reliance on oil exports has also neglected development of other sectors like agriculture.
The annual report summarizes the activities of the World Economic Forum from July 1999 to June 2000. It describes this period as the most successful year in the Forum's history, with growth in membership, participation, and funding. Key events included the annual meeting in Davos and regional summits around the world. The Forum underwent restructuring to focus on global issues, industries, and regions. It continues producing influential reports on competitiveness and the global economy.
The resource curse reloaded: revisiting the Dutch disease with economic compl...FGV Brazil
Â
This paper shows that the Dutch disease can be more formally characterised as low economic complexity using ECI-type indicators; there is a solid and robust inverse relationship between exports concentrating on natural resources and economic complexity as measured by complexity indicators for a database of 122 countries from 1963 to 2013. In a large majority of cases, oil answers for shares in excess of 50% of exports. In addition to empirical panel analysis, we address case studies concerned with Indonesia and Nigeria and introduce a brief review of the theoretical literature on the topic. Indonesia is considered in the literature as a good example in avoiding the negative effects of the Dutch disease, whereas Nigeria is taken as a bad example in terms of institutions and policies adopted during the seventies and eighties. The empirical results show that complexity analysis and Big Data may offer significant contributions to the still-current debate surrounding the Dutch disease.
Date: 2017-03
Authors:
Camargo, Jhean Steffan Martines de
Gala, Paulo
The document compares economic development ideas from the 1960s and 1980s. In the 1960s, government played a central role in development through policies like import substitution. By the 1980s, government was seen as an obstacle, and private investment, trade liberalization, and foreign direct investment were emphasized instead of government borrowing. Development assistance also shifted from project loans to policy-based lending to encourage market-friendly reforms.
The document summarizes Ethiopia's industrial policies under the current EPRDF regime since 1991. It discusses how the regime has implemented policies to strengthen the economy through an export-led industrialization strategy. Some of the key policies discussed include the Industrial Development Strategy (IDS) from 2002-2003, which aims to promote labor-intensive and export-oriented industries. IDS utilizes four main tools - stabilizing macroeconomic variables like inflation; creating a business friendly environment; building infrastructure; and providing support to competitive industries like flowers. While these policies have achieved some success, Ethiopia still faces challenges like high inflation, lack of foreign investment, and weak logistics sectors.
The oil industry in Angola, though owned by the state, operates under a capitalist mode of production. While Angola's constitution declares natural resources as state property, profits from oil production are split between international companies and the state-owned Sonangol through production sharing agreements. Despite increased oil revenues, little has benefited the Angolan people, as seen by low human development scores and below-average public spending on healthcare and education. While measures aim to increase transparency, the oil industry remains dominated by capitalist relations between foreign firms and the government.
Examining the Impact of Export-Led Growth Strategy: Evidences From Nigeria (1...inventionjournals
Â
The Nigerian economy had for decades been dependent on the fragile leg of crude oil exports. An emerging trend however suggests that in the last ten years the economy was growing without job creation and poverty reduction consequent upon fall in the international oil markets. Expectedly, attention of scholars had shifted towards the development of non-oil exports as a substitute for this quagmire. This study analyses Export-Led Growth Strategy in Nigeria using Annual Data between 1960 and 2015. The study adopted the Autoregressive Distributed Lag (ARDL) Approach on a modified Cobb Douglass Production Function in the analysis. The choice of ARDL is informed by many considerations: it can be used irrespective of whether the regressors are I(1) or I(0) or a mixture of both. Results of the findings revealed that oil exports are directly related to GDP while non-oil exports are not, and implacably non-oil exports do not impact on GDP. The study also revealed that there is a long run relationship between GDP and both components of exports (oil and nonoil) which can be used to determine the possible direction of GDP. And in case of distortion in the economy, equilibrium can be restored at 12 per cent growth rate per annum as one of the study revelations. The study among others recommends that government should diversify the economy to ensure maximum contributions from all facets of the same to enhance economic growth of the country.
Foreign trade and economic growth in nigeria (1980 2010)Alexander Decker
Â
1. The document discusses foreign trade and economic growth in Nigeria from 1980-2010. It analyzes how foreign trade has impacted Nigeria's economy and growth over this period.
2. Nigeria traditionally relied on agricultural exports like cocoa, palm oil, and groundnuts, but since the 1960s oil has dominated exports. Oil exports now account for over 90% of total exports.
3. While foreign trade can promote growth, Nigeria still faces economic instability and import dependence. The heavy reliance on oil exports has also neglected development of other sectors like agriculture.
The annual report summarizes the activities of the World Economic Forum from July 1999 to June 2000. It describes this period as the most successful year in the Forum's history, with growth in membership, participation, and funding. Key events included the annual meeting in Davos and regional summits around the world. The Forum underwent restructuring to focus on global issues, industries, and regions. It continues producing influential reports on competitiveness and the global economy.
Africa 2050 Realizing the Continents Full PotentialDr Lendy Spires
Â
This document presents a vision for Africa in 2050 called "Africa 2050: Realizing the Continent's Full Potential". The vision sees Africa achieving much higher living standards, with average per capita income increasing six-fold to $17,000, extreme poverty reduced dramatically, and 1.4 billion additional Africans joining the middle class. Key elements of the vision include much higher productivity, a thriving private sector, better integrated regions in Africa, and relationships with other world regions based more on trade and investment than aid. Achieving this vision will require leveraging drivers of change like population growth and urbanization, while managing risks like conflict and inequality. The document outlines a strategic framework and specific policy agenda to promote inclusive growth, competitive
This document discusses the natural resource curse known as "Dutch disease" where countries with abundant natural resources experience slower economic growth compared to countries with fewer natural resources. It provides examples of how discovery and export of oil and gas led to economic issues in the Netherlands, Nigeria, Russia, Azerbaijan, and other countries. The specific factor model is presented to explain how revenue from the booming natural resource sector can appreciate the currency, draw resources from the manufacturing sector, and harm competitiveness. Ways that countries like Norway have tried to mitigate Dutch disease through sovereign wealth funds and policies to diversify the economy are also examined.
This document analyzes the development paths of Indonesia, Malaysia, and Thailand (SEANICs) from the 1980s to 2010. It discusses how these countries specialized in natural resource exports but diversified into manufacturing exports within a short period. This resulted in rapid GDP and per capita GDP growth. While SEANICs manufacturing exports grew significantly, their share of world income did not rise proportionally. The document examines how regional integration, foreign direct investment, and macroeconomic policies supported SEANICs' structural transformation from resource exporters to manufacturing exporters.
ECONOMIC REFORMS AND INCREASING TREND OF GULF MIGRATION OF MUSLIM WEA...Amir Hussain
Â
This document discusses the impact of economic reforms in India on Muslim weavers in the Azamgarh district of Uttar Pradesh. It notes that economic reforms opened India's economy to greater global competition, which particularly impacted traditional handicraft industries and workers. This included Muslim weavers who produced goods with simple tools for local markets. Facing tough competition from large multinational corporations, and lacking technical skills to participate in new industries, many weavers struggled to make a living from their traditional work. As a result, the document finds there has been an increasing trend of Gulf migration by these weavers as unskilled laborers to countries like the UAE and Saudi Arabia, in search of better financial opportunities and
China has experienced above-normal growth since 1999, even though it is a semi peripheral developing country. The numbers do not lie because, since the late 1990s, their growth has been between 7.5% and 11.7%. The main causes of this growth can be attributed to direct external investments in export-oriented industrial production, accompanied by cheap labor along with the high level of qualification and the government's incentive for multinational companies to invest in the country and, above all, to the active role of the Chinese state in promoting national development. China's economy is the second largest in the world, surpassed only by the United States. China is the nation with the highest economic growth of the last 25 years in the world, with average GDP growth around 10% per year. China is on the verge of overtaking the United States as the world's largest economy.
It can be said that the failure in promoting economic and social development of almost all peripheral and semi-peripheral countries of the world can be attributed to the fact that the governments of these countries have adopted strategies to promote national development in isolation in relation to the world system capitalist. The new theoretical reference of analysis of the economic system of a nation taking into account the capitalist world-system proposed by Wallerstein is opposed to the Cartesian approach that formulates the development of the national economic system dissociated of the capitalist world system. So that explains the failure of national developmentalism and socialism deployment that resulted from the fact that their mentors admit having ability to promote national economic and social development disassociated from the capitalist world-system.
This document summarizes a study that investigated the effects of capital goods imports on physical capital formation and economic growth in sub-Saharan Africa countries from 1985 to 2018. The study used data from various sources and employed descriptive statistics, panel Granger causality tests, and panel co-integration as estimation techniques. The results showed that capital goods imports had a positive but small contribution to economic growth and physical capital formation. Panel Granger causality tests also found bi-directional causality between economic growth and capital goods imports, but only uni-directional causality from capital goods imports to physical capital formation. The study concludes that capital goods imports are not large enough to effectively influence growth and capital formation in sub-Saharan Africa,
Turkey has experienced significant economic growth and transformation over the past decades. Some key points:
- Turkey has the 18th largest economy in the world and has seen strong GDP growth in recent years, though it remains heavily dependent on imports.
- Agriculture was historically a leading sector but now others like automotive, consumer durables, and tourism are major drivers of growth.
- Recent economic reforms have aimed to liberalize trade, encourage foreign investment and privatization, and stabilize public finances. However, unemployment and current account deficits remain challenges.
- While Turkey has a large, young population, regional disparities in development exist and it still lags behind many European countries on measures of prosperity and welfare. EU
The document discusses economic growth in Turkey. It covers key topics such as GDP, GDP per capita, growth rates, the effects of population growth, and productivity. Methods for measuring economic growth include growth accounting and the Solow model. Turkey has experienced economic crises in 1994, 2000, and 2001 related to growing current account deficits. As a developing country seeking EU membership, analyzing sources of growth is important for achieving stable and sustainable growth.
The document discusses the opportunities in Turkey's automotive industry, noting that Turkey has one of the fastest growing economies in the world. It highlights Turkey's young population and strategic location bridging Europe and Asia as advantages. The automotive sector in Turkey is growing globally and domestically, presenting opportunities to export automotive parts by targeting this sector for investment.
Globalization has significantly impacted India's agricultural sector in several ways. It has changed the structure of the economy so that the services sector now contributes the largest portion of GDP compared to agriculture previously. Globalization has also increased India's overall economic growth rate and position in the global economy. However, it has also led to issues like marginalization of small farmers in India as larger farmers have benefited more from economic reforms. Continuing this trend could create future problems if not addressed properly. Overall, globalization presents both opportunities and challenges that India must navigate carefully to achieve continued development.
Public policy and trade liberalisation in nigerian economic developmentAlexander Decker
Â
This document discusses public policy and trade liberalization in Nigerian economic development. It provides background on Nigeria's trade policies since 1986, which centered on greater market openness and integration into the global economy. It analyzes the impacts of specific trade liberalization policies like trade openness, privatization, investment flows, and import tariffs on Nigeria's economic development. The analysis finds that trade liberalization has not had a positive impact on Nigeria's economic development. Accountability, transparency, and good governance are recommended to improve economic policy and encourage self-reliance through export promotion and import substitution.
Observers of Japanese security and foreign policies have largely focused on analyzing Japanese policies in the area of traditional security. However, they would be remiss to disregard the string of new developments that have been occurring in Japan â namely that of âeconomic security.â
Prompted by rising U.S.-China competition, Japan has been undergoing rapid change in its economic security policies over the last few years. These changes range from organizational transformation to new legislation as well as increasing support for the private sector. This trend is likely to accelerate under the incoming Kishida administration, which has created a new ministerial post for economic security.
How has Japanâs economic security policy evolved in the last few years? What kind of changes will we likely see in Japanâs economic security policies under the Kishida administration? What impact will this âeconomic security awakeningâ in Japan have on Japan-U.S. and Japan-China relations? How should Japan cooperate with other key actors, such as the European Union, the Quad countries, the Five Eyes states, and Southeast Asian countries?
This seminar will address these critical questions and more with Akira Igata, who has been advising international organizations, the Japanese government, bureaucracy, and the private sector in economic security issues for many years.
Speaker Biography:
Akira Igata is Executive Director and Visiting Professor at the Center for Rule-making Strategies at Tama University. He is also the Economic Security Advisor for the Inter-Parliamentary Alliance on China and Senior Adjunct Fellow at Pacific Forum, a U.S.-based think tank. He advises Japanâs bureaucracy, politicians, and private sector as well as international organizations on economic security issues.
foreign trade as an engine of economic growthMitikaAnjel
Â
Foreign trade acts as an "engine" of economic growth in three key ways: 1) It enlarges a country's market for exports, leading to greater production and utilization of resources; 2) Expanding exports provides more employment opportunities and economies of scale, lowering costs; 3) Access to global markets encourages innovation as businesses compete with international counterparts, improving efficiency and productivity. For example, the opening of the Suez Canal increased India's exports of commercial crops like cotton and tea, fueling economic growth. Export processing zones also create jobs and incomes, stimulating demand and further domestic manufacturing. Overall, specialization, competition and technological adoption spurred by foreign trade can power economic expansion.
Why Extractive-Based Nations Fail: Between Resource and Knowledge-Based Econo...CSR-in-Action
Â
This whitepaper highlights the reasons why Extractive-Based nations fail, sighting the difference between Resource and Knowledge-Based economies. Countries thrive when they build economic institutions that unleash, empower and protect the full potential of each citizen to innovate, invest and develop.
This document discusses the external environments and HR practices of American MNCs operating in China, Singapore, and Sri Lanka. It analyzes factors like the economic, political, cultural, technological, and legal environments in each country and how they impact the transfer of American HR practices. It also examines how MNCs implement practices related to recruitment, training, rewards, and performance management in the host countries while facing new trends and challenges in Asian markets.
This document summarizes Turkey's economic development strategies from 1923 to 2014, moving from an inward-looking, state-led strategy to a more outward, market-oriented approach. From the 1930s to 1980, Turkey pursued import substitution industrialization behind high trade barriers. This led to economic crises and dependence on foreign loans. In 1980, under pressure from the IMF and World Bank, Turkey embarked on structural adjustment, liberalizing trade, privatizing state firms, and adopting an export-led growth model focused on market forces over state intervention.
This document summarizes a study that examined factors affecting foreign direct investment (FDI) flows to Ethiopia from 1990 to 2011. The study used a multiple regression model to analyze the relationship between FDI inflows as a percentage of GDP (the dependent variable) and five independent variables: market size, trade openness, inflation rate, infrastructure, and human capital. Time series data from 1990 to 2011 on these variables was obtained from the World Bank and analyzed. The findings showed that trade openness and inflation rate had a significant impact on FDI flows to Ethiopia, while no clear relationship was found for market size, infrastructure, and human capital.
This document provides an introduction and literature review for a paper examining the role of the informal sector in promoting regional economic integration in West Africa. It discusses definitions of the informal sector and its importance as an employer, particularly for vulnerable groups. The paper aims to develop an Informal-Formal Sector Transmission Model to establish the link between the informal sector, market access, and regional integration. It argues that promoting the informal sector through market access could reduce poverty, conflicts, and encourage integration in West Africa. The methodology will use currency and monetary data from Nigeria to measure the informal sector, along with descriptive analysis and model development.
Informal sector in india and challenges for its transformationDr Lendy Spires
Â
This document discusses the informal sector in India and its challenges. It provides context on how the informal sector was traditionally viewed as temporary and expected to disappear with development, but political and economic factors prevented its full transformation. The informal sector has reemerged under globalization with new dynamics. The document examines factors driving informalization, such as lack of land reforms, economic crises, changes to production models, and the impacts of trade liberalization. It also discusses how the informal sector is now defined, including distinguishing between informal enterprises, employment, and households.
Melia-Oct.2015 Politcal Economy of Extractive Resources, GIZElvis Melia
Â
This document provides a political economy framework for understanding the resource curse phenomenon often seen in resource-rich developing countries. It introduces three approaches: (1) the dynamics within a country's elite political circles as they negotiate sharing of resource rents; (2) the dynamics among political elites, state technocrats tasked with industrial policy, and domestic firms; and (3) the dynamics between top national elites and provincial politicians in extraction areas. Several case studies illustrate these dynamics, showing how natural resource wealth can undermine industrial development, strengthen patronage systems, and increase regional tensions. The document aims to explain challenges that may arise in implementing technical cooperation guidelines to promote sustainable development in resource-rich partner countries.
Globalization has both benefits and costs for economic growth. It allows for greater specialization and trade between countries, improving productivity and GDP. However, it can also increase inequality as lower-skilled workers face more competition. While globalization has helped reduce poverty in some nations, it has also caused economic hardship for domestic industries unable to compete with imports. Overall, whether a country benefits depends on how well it adapts its infrastructure and workforce to the new global economic system.
Africa 2050 Realizing the Continents Full PotentialDr Lendy Spires
Â
This document presents a vision for Africa in 2050 called "Africa 2050: Realizing the Continent's Full Potential". The vision sees Africa achieving much higher living standards, with average per capita income increasing six-fold to $17,000, extreme poverty reduced dramatically, and 1.4 billion additional Africans joining the middle class. Key elements of the vision include much higher productivity, a thriving private sector, better integrated regions in Africa, and relationships with other world regions based more on trade and investment than aid. Achieving this vision will require leveraging drivers of change like population growth and urbanization, while managing risks like conflict and inequality. The document outlines a strategic framework and specific policy agenda to promote inclusive growth, competitive
This document discusses the natural resource curse known as "Dutch disease" where countries with abundant natural resources experience slower economic growth compared to countries with fewer natural resources. It provides examples of how discovery and export of oil and gas led to economic issues in the Netherlands, Nigeria, Russia, Azerbaijan, and other countries. The specific factor model is presented to explain how revenue from the booming natural resource sector can appreciate the currency, draw resources from the manufacturing sector, and harm competitiveness. Ways that countries like Norway have tried to mitigate Dutch disease through sovereign wealth funds and policies to diversify the economy are also examined.
This document analyzes the development paths of Indonesia, Malaysia, and Thailand (SEANICs) from the 1980s to 2010. It discusses how these countries specialized in natural resource exports but diversified into manufacturing exports within a short period. This resulted in rapid GDP and per capita GDP growth. While SEANICs manufacturing exports grew significantly, their share of world income did not rise proportionally. The document examines how regional integration, foreign direct investment, and macroeconomic policies supported SEANICs' structural transformation from resource exporters to manufacturing exporters.
ECONOMIC REFORMS AND INCREASING TREND OF GULF MIGRATION OF MUSLIM WEA...Amir Hussain
Â
This document discusses the impact of economic reforms in India on Muslim weavers in the Azamgarh district of Uttar Pradesh. It notes that economic reforms opened India's economy to greater global competition, which particularly impacted traditional handicraft industries and workers. This included Muslim weavers who produced goods with simple tools for local markets. Facing tough competition from large multinational corporations, and lacking technical skills to participate in new industries, many weavers struggled to make a living from their traditional work. As a result, the document finds there has been an increasing trend of Gulf migration by these weavers as unskilled laborers to countries like the UAE and Saudi Arabia, in search of better financial opportunities and
China has experienced above-normal growth since 1999, even though it is a semi peripheral developing country. The numbers do not lie because, since the late 1990s, their growth has been between 7.5% and 11.7%. The main causes of this growth can be attributed to direct external investments in export-oriented industrial production, accompanied by cheap labor along with the high level of qualification and the government's incentive for multinational companies to invest in the country and, above all, to the active role of the Chinese state in promoting national development. China's economy is the second largest in the world, surpassed only by the United States. China is the nation with the highest economic growth of the last 25 years in the world, with average GDP growth around 10% per year. China is on the verge of overtaking the United States as the world's largest economy.
It can be said that the failure in promoting economic and social development of almost all peripheral and semi-peripheral countries of the world can be attributed to the fact that the governments of these countries have adopted strategies to promote national development in isolation in relation to the world system capitalist. The new theoretical reference of analysis of the economic system of a nation taking into account the capitalist world-system proposed by Wallerstein is opposed to the Cartesian approach that formulates the development of the national economic system dissociated of the capitalist world system. So that explains the failure of national developmentalism and socialism deployment that resulted from the fact that their mentors admit having ability to promote national economic and social development disassociated from the capitalist world-system.
This document summarizes a study that investigated the effects of capital goods imports on physical capital formation and economic growth in sub-Saharan Africa countries from 1985 to 2018. The study used data from various sources and employed descriptive statistics, panel Granger causality tests, and panel co-integration as estimation techniques. The results showed that capital goods imports had a positive but small contribution to economic growth and physical capital formation. Panel Granger causality tests also found bi-directional causality between economic growth and capital goods imports, but only uni-directional causality from capital goods imports to physical capital formation. The study concludes that capital goods imports are not large enough to effectively influence growth and capital formation in sub-Saharan Africa,
Turkey has experienced significant economic growth and transformation over the past decades. Some key points:
- Turkey has the 18th largest economy in the world and has seen strong GDP growth in recent years, though it remains heavily dependent on imports.
- Agriculture was historically a leading sector but now others like automotive, consumer durables, and tourism are major drivers of growth.
- Recent economic reforms have aimed to liberalize trade, encourage foreign investment and privatization, and stabilize public finances. However, unemployment and current account deficits remain challenges.
- While Turkey has a large, young population, regional disparities in development exist and it still lags behind many European countries on measures of prosperity and welfare. EU
The document discusses economic growth in Turkey. It covers key topics such as GDP, GDP per capita, growth rates, the effects of population growth, and productivity. Methods for measuring economic growth include growth accounting and the Solow model. Turkey has experienced economic crises in 1994, 2000, and 2001 related to growing current account deficits. As a developing country seeking EU membership, analyzing sources of growth is important for achieving stable and sustainable growth.
The document discusses the opportunities in Turkey's automotive industry, noting that Turkey has one of the fastest growing economies in the world. It highlights Turkey's young population and strategic location bridging Europe and Asia as advantages. The automotive sector in Turkey is growing globally and domestically, presenting opportunities to export automotive parts by targeting this sector for investment.
Globalization has significantly impacted India's agricultural sector in several ways. It has changed the structure of the economy so that the services sector now contributes the largest portion of GDP compared to agriculture previously. Globalization has also increased India's overall economic growth rate and position in the global economy. However, it has also led to issues like marginalization of small farmers in India as larger farmers have benefited more from economic reforms. Continuing this trend could create future problems if not addressed properly. Overall, globalization presents both opportunities and challenges that India must navigate carefully to achieve continued development.
Public policy and trade liberalisation in nigerian economic developmentAlexander Decker
Â
This document discusses public policy and trade liberalization in Nigerian economic development. It provides background on Nigeria's trade policies since 1986, which centered on greater market openness and integration into the global economy. It analyzes the impacts of specific trade liberalization policies like trade openness, privatization, investment flows, and import tariffs on Nigeria's economic development. The analysis finds that trade liberalization has not had a positive impact on Nigeria's economic development. Accountability, transparency, and good governance are recommended to improve economic policy and encourage self-reliance through export promotion and import substitution.
Observers of Japanese security and foreign policies have largely focused on analyzing Japanese policies in the area of traditional security. However, they would be remiss to disregard the string of new developments that have been occurring in Japan â namely that of âeconomic security.â
Prompted by rising U.S.-China competition, Japan has been undergoing rapid change in its economic security policies over the last few years. These changes range from organizational transformation to new legislation as well as increasing support for the private sector. This trend is likely to accelerate under the incoming Kishida administration, which has created a new ministerial post for economic security.
How has Japanâs economic security policy evolved in the last few years? What kind of changes will we likely see in Japanâs economic security policies under the Kishida administration? What impact will this âeconomic security awakeningâ in Japan have on Japan-U.S. and Japan-China relations? How should Japan cooperate with other key actors, such as the European Union, the Quad countries, the Five Eyes states, and Southeast Asian countries?
This seminar will address these critical questions and more with Akira Igata, who has been advising international organizations, the Japanese government, bureaucracy, and the private sector in economic security issues for many years.
Speaker Biography:
Akira Igata is Executive Director and Visiting Professor at the Center for Rule-making Strategies at Tama University. He is also the Economic Security Advisor for the Inter-Parliamentary Alliance on China and Senior Adjunct Fellow at Pacific Forum, a U.S.-based think tank. He advises Japanâs bureaucracy, politicians, and private sector as well as international organizations on economic security issues.
foreign trade as an engine of economic growthMitikaAnjel
Â
Foreign trade acts as an "engine" of economic growth in three key ways: 1) It enlarges a country's market for exports, leading to greater production and utilization of resources; 2) Expanding exports provides more employment opportunities and economies of scale, lowering costs; 3) Access to global markets encourages innovation as businesses compete with international counterparts, improving efficiency and productivity. For example, the opening of the Suez Canal increased India's exports of commercial crops like cotton and tea, fueling economic growth. Export processing zones also create jobs and incomes, stimulating demand and further domestic manufacturing. Overall, specialization, competition and technological adoption spurred by foreign trade can power economic expansion.
Why Extractive-Based Nations Fail: Between Resource and Knowledge-Based Econo...CSR-in-Action
Â
This whitepaper highlights the reasons why Extractive-Based nations fail, sighting the difference between Resource and Knowledge-Based economies. Countries thrive when they build economic institutions that unleash, empower and protect the full potential of each citizen to innovate, invest and develop.
This document discusses the external environments and HR practices of American MNCs operating in China, Singapore, and Sri Lanka. It analyzes factors like the economic, political, cultural, technological, and legal environments in each country and how they impact the transfer of American HR practices. It also examines how MNCs implement practices related to recruitment, training, rewards, and performance management in the host countries while facing new trends and challenges in Asian markets.
This document summarizes Turkey's economic development strategies from 1923 to 2014, moving from an inward-looking, state-led strategy to a more outward, market-oriented approach. From the 1930s to 1980, Turkey pursued import substitution industrialization behind high trade barriers. This led to economic crises and dependence on foreign loans. In 1980, under pressure from the IMF and World Bank, Turkey embarked on structural adjustment, liberalizing trade, privatizing state firms, and adopting an export-led growth model focused on market forces over state intervention.
This document summarizes a study that examined factors affecting foreign direct investment (FDI) flows to Ethiopia from 1990 to 2011. The study used a multiple regression model to analyze the relationship between FDI inflows as a percentage of GDP (the dependent variable) and five independent variables: market size, trade openness, inflation rate, infrastructure, and human capital. Time series data from 1990 to 2011 on these variables was obtained from the World Bank and analyzed. The findings showed that trade openness and inflation rate had a significant impact on FDI flows to Ethiopia, while no clear relationship was found for market size, infrastructure, and human capital.
This document provides an introduction and literature review for a paper examining the role of the informal sector in promoting regional economic integration in West Africa. It discusses definitions of the informal sector and its importance as an employer, particularly for vulnerable groups. The paper aims to develop an Informal-Formal Sector Transmission Model to establish the link between the informal sector, market access, and regional integration. It argues that promoting the informal sector through market access could reduce poverty, conflicts, and encourage integration in West Africa. The methodology will use currency and monetary data from Nigeria to measure the informal sector, along with descriptive analysis and model development.
Informal sector in india and challenges for its transformationDr Lendy Spires
Â
This document discusses the informal sector in India and its challenges. It provides context on how the informal sector was traditionally viewed as temporary and expected to disappear with development, but political and economic factors prevented its full transformation. The informal sector has reemerged under globalization with new dynamics. The document examines factors driving informalization, such as lack of land reforms, economic crises, changes to production models, and the impacts of trade liberalization. It also discusses how the informal sector is now defined, including distinguishing between informal enterprises, employment, and households.
Melia-Oct.2015 Politcal Economy of Extractive Resources, GIZElvis Melia
Â
This document provides a political economy framework for understanding the resource curse phenomenon often seen in resource-rich developing countries. It introduces three approaches: (1) the dynamics within a country's elite political circles as they negotiate sharing of resource rents; (2) the dynamics among political elites, state technocrats tasked with industrial policy, and domestic firms; and (3) the dynamics between top national elites and provincial politicians in extraction areas. Several case studies illustrate these dynamics, showing how natural resource wealth can undermine industrial development, strengthen patronage systems, and increase regional tensions. The document aims to explain challenges that may arise in implementing technical cooperation guidelines to promote sustainable development in resource-rich partner countries.
Globalization has both benefits and costs for economic growth. It allows for greater specialization and trade between countries, improving productivity and GDP. However, it can also increase inequality as lower-skilled workers face more competition. While globalization has helped reduce poverty in some nations, it has also caused economic hardship for domestic industries unable to compete with imports. Overall, whether a country benefits depends on how well it adapts its infrastructure and workforce to the new global economic system.
1. The document discusses various aspects of economic systems including economic planning, industrial policy, liberalization, privatization, and globalization reforms in India.
2. It provides details on the objectives and components of India's five year plans from the 1st to 12th plans.
3. The reforms in the 1990s known as LPG (Liberalization, Privatization, Globalization) aimed to make India a fast growing global economy and included opening various sectors to foreign investment and trade.
The unformal sector in sub saharan africa - out of the shadows to forster sus...Dr Lendy Spires
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This document discusses the growth of the informal sector in sub-Saharan Africa and its implications. It argues that the informal sector should be seen as a vibrant part of the economy rather than just a marginalized sector. The informal sector now provides the majority of employment across sub-Saharan Africa and makes up a large portion of GDP. The growth of the informal sector is due to factors like urban bias in development policies, restrictive labor laws, rural-urban migration, and structural adjustment policies. The document recommends establishing policies and regulations that support the growth of the informal sector in order to foster employment, economic growth, and equity.
The document discusses several aspects of the changing global economic environment since World War II. It notes that global markets have emerged and displaced local competitors. Economic integration has increased from 10% to 50% over the 20th century, particularly in Europe and North America. The automobile industry was once composed of local brands but is now highly globalized. Other changes discussed include increased capital movement, changing relationships between productivity and employment, and the emergence of a dominant world economy.
The document discusses various topics related to international business management including globalization, trade liberalization, GATT, WTO, and foreign direct investment (FDI). Regarding globalization, it provides an overview of aspects like trade, capital flows, movement of people, and spread of knowledge across borders. It then discusses the positives of trade liberalization such as increased growth, poverty reduction, and new jobs. The summary compares GATT and WTO, noting that WTO replaced GATT and has broader coverage of trade in goods, services, and intellectual property with stronger dispute settlement procedures. It also explains that MNCs pursue different business strategies and may opt for FDI to enter foreign markets in order to gain high anticipated profits.
THE IMPACT OF TRADE LIBERALIZATION ON ECONOMIC GROWTH; THE CASE OF SUB-SAHARA...AkashSharma618775
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The main aim of this research is to explore the effect of trade liberalization on economic growth in subSaharan Africa by analyzing certain macro-economic indicators using Ordinary Least Squares approach to
estimate regression equations. Many developing countries have substantially liberalized their trade regime over the
past three decades, either unilaterally or as part of multilateral initiatives. Nevertheless, trade barriers remain
high in many developing countries. One of the concerns that attributes to the reluctance of many of these countries
to liberalize their trade regime is the possible worsening of the trade balance.
This research paper is meant to give a recommendation on which macro-economic indicators sub-Saharan African
countries should pay particular attention to, implementing the necessary policies to ensure its effectiveness thereby
ensuring a step-up in those aspects of the economy in order to promote development. It considers 46 different
countries with different economic policies in sub-Saharan Africa for a 14-year period. Most papers considering
sub-Saharan African region consider a selected few countries based on certain economic reasons of their choice,
and those who consider most countries in the region have different macroeconomic indicators they employ for their
modeling. This paper considers if not all, almost all sub-Saharan African countries regardless of their economic
status.
This document discusses globalization, liberalization, and agrarian distress in India that has contributed to increasing farmer suicides. It outlines how India began liberalizing its economy in 1991 through structural adjustment programs encouraged by international financial institutions. While the government claims reforms have helped development, facts from rural India show a deep crisis in the agrarian sector. Farmers face increasing insecurity and vulnerability due to reforms. The document analyzes how economic conditions during the reform phase have created conditions for farmer suicides across India.
Classical theories of Economic Development.pptxKirti441999
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The document discusses several classical and contemporary theories of economic development:
1. Early theories included Smith's laissez-faire views and Marx's critique of capitalism. Rostow's model proposed 5 linear stages of growth.
2. Structural change models emphasized shifting labor from agriculture to industry. The Harrod-Domar and Lewis models focused on investment and capital.
3. Dependence theories argued poor countries were exploited by wealthy nations.
4. Neoclassical theories promoted free markets over government intervention. The Solow model included technology and human capital.
5. New growth theories treat technology as endogenous and knowledge-driven. Coordination failure theories address market inefficiencies.
International business management essay globalizationBobby Darmawan
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Globalization has both advantages and disadvantages. It allows large corporations to access new markets and supplies, driving economic growth. However, it also enables the exploitation of developing countries through outsourcing of jobs and environmental damage. While globalization has reduced poverty, economic downturns can now rapidly spread worldwide through integrated financial systems. There are reasonable arguments on both sides of whether globalization should be encouraged or discouraged.
Globalization has become an inescapable reality in today's society. It refers to the increasing integration of economies and societies around the world through trade, capital and information flows, and movement of people. While globalization has increased economic growth and opportunities in many countries, it has also contributed to rising inequality, threats to national culture and sovereignty, and greater economic disruptions that can spread across borders. As India has opened its economy to global trade and investment since the 1990s, it has experienced rapid GDP growth but also increased poverty, unemployment, and social issues alongside prosperity for some. India needs further reforms to fully leverage globalization while managing its risks and disadvantages.
Harnessing the potentials of the informal sector for sustainable developmentDr Lendy Spires
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The document discusses the informal sector in Nigeria and its importance for sustainable development. Some key points:
1) The informal sector plays a major role in African economies, providing employment and supporting growth. In Nigeria, it has helped sustain the economy during difficult economic times when the formal sector struggled.
2) The informal sector is made up mostly of small, individual or family-owned businesses with low capitalization. It faces many constraints including lack of access to credit, skills, and government support.
3) Despite challenges, the informal sector has significantly contributed to employment, income generation, and economic activity in Nigeria. It has helped absorb workers laid off from the formal sector and supported the livelihoods of many Niger
The State and the Market in the Building of African EconomiesDr Lendy Spires
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1. The document discusses the relationship between the state and the market in building African economies from independence to present.
2. In the post-colonial period, African states adopted import substitution industrialization (ISI) policies that involved substantial public support and protectionism. This centralized the state's role in development.
3. By the 1980s, ISI policies had led to debt crises, inefficient public enterprises, and lost decades of development in Africa. Structural adjustment policies drastically reduced the state's role and advocated free markets.
- The worldwide movement toward economic, financial, trade, and communications integration.
Globalization implies the opening of local and nationalistic perspectives to a broader outlook of an interconnected and interdependent world with free transfer of capital, goods, and services across national frontiers. However, it does not include unhindered movement of labor and, as suggested by some economists, may hurt smaller or fragile economies if applied indiscriminately
The Resource Curse and Oil Revenues in Venezuela And AngolaDvinz Oil & Gas,S.A
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Dvinz Oil & Gas,S.A: To many people in Latin America, Hugo ChĂĄvez was a revolutionary hero who embraced the poor. rabbing control of Venezuelaâs vast oil wealth, using its proceeds to fund social and anti-poverty projects, and expelling the free-market scolds from the I.M.F., the World Bank, and his countryâs business establishment. On the other hand, ChĂĄvez was a leader dealing with the âresource curseâ that has afflicted all too many developing countries.
The globalization paradox in the 21st century and its applicability in the an...Armend Muja
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During the last three decades (1980-2010) there has been an intensification of international economic exchange both in volume, regions and people involved. The scale and depth of economic integration has raised concerns among scholars that these developments are reminiscent of the era of pre-Great Depression liberalization. Critics of globalization point out that the removal of trade barriers and capital controls would tilt the balance of power towards capital holders and richer economies. Arguably, this undermines state sovereignty, democracy and internal stability. A growing number of scholars have dismissed those concerns pointing out the net benefits of trade and globalization and reduction of world poverty. The paper finds that concerns of the demise of the nation state due to increased economic globalization are exaggerated. Increased liberalization has only served to strengthen the role of governments. However, the net gains from increased economic exchange have not been equally shared domestically nor across trading regions. Countries that have embraced globalization but maintained their breaks over its downsides have made most gains.
This document provides an introduction and literature review for a paper examining the relationship between the informal sector, market access, and economic integration in West Africa. It discusses definitions of the informal sector and its importance as an employer in West Africa. It then introduces an Informal-Formal Sector Transmission Model (INFORSTRAM) that will be used to analyze the link between the informal sector, market access, and regional economic integration. The paper aims to investigate how formalizing the informal sector can promote intra-regional trade and economic integration in West Africa.
Chapter 3-1 Classic Growth and Development Models.pptselam49
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The document discusses several classic theories of economic growth and development:
1. Rostow's stages of growth model and the Harrod-Domar growth model propose that countries pass through linear stages of economic development as saving, investment, and foreign aid drive growth.
2. The Lewis two-sector model and Chenery model describe theories of structural change, where resources shift from low-productivity agriculture to higher-productivity industry and services as countries develop.
3. International dependence theories examine how countries are influenced by relationships with more developed nations in their economic progress.
4. Neoclassical, free-market theories counter that open markets and free trade best promote development.
The document
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Lyes Boudiaf. Founder & President of Isly Holdings. Algeria. Lyes Boudiaf has been decorated as knight of the honorary Order of Merit of the State of Portugal
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Lyes Boudiaf. Founder & President of Isly Holdings. Algeria. Lyes Boudiaf has been decorated as knight of the honorary Order of Merit of the State of Portugal
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5. 4
Following the riots in October 1988, and the military coup which interrupted the electoral process at the
beginning of 1992 (after the Front Islamique de Salut had won the first round of elections), Algeria erupted into
civil war (the âblack decadeâ: 1992-1999) between the military power and Islamic movements, leaving almost a
hundred thousand people dead. Destabilised by terrorist attacks and squeezed hard by the fall in oil prices,
Algeria suspended its debt service payment in 1994. Placed under the tutelage of the IMF (with the signing of a
structural adjustment plan), Algeria was forced to adopt a free market economy policy.
Despite repeated promises to liberalise the energy market industry, the status quo of the patronage between
Sonatrach and the government continued. The degree of liberalisation and control varied, depending on the
price of oil and internal pressure (Entelis, 1999).
In fact, Sonatrachâs strategy and global performance in Algeriaâs oil and gas sector remained pretty much the
same despite the globalisation of the oil and gas industry. Algeria adopted a series of reforms that aimed to
enhance the countryâs economic transparency and efficiency. These reforms encouraged more competition
and helped to improve the performance of the Algerian energy industry, but the governmentâs determination
to keep its grip on the sector explains why moves to liberalise the industry have continually been abandoned
each time the authorities believe that their power is being challenged.
The way a country opens up its market to the outside world depends on its sectorial organisation (types of
comparative advantage) and the cohesion of its policy-makers (Hall, 1997; Abbas, 2012). This type of change
could therefore only take place once protectionism â which oversaw the first decades of independence â lost
its legitimacy. Given the concentration of exports in oil and gas, the acceptable level of imports consequently
needs to be defined. As Abbas (2012) pointed out: âIn the case of Algeria, where energy is the only export
sector, control over imports, but, above all, over the actors and the import networks, is a key factor in
managing global integration.â
Today, almost 50 years after independence, the Algerian economy is a service-based ârentierâ economy.
According to the national office of statistics, 83% of the economic fabric is based on trade and small-scale
services. Over 90% of the industrial fabric is made up of family-based SMI/SME structures. The country owns
the third largest oil reserves in Africa (12.2 billion barrels) and a third of the continentâs gas resources (4500
billion cubic metres) but still does not have the real aggregates needed to build a modern economy outside of
the oil and gas sector (Aliouche, 2014). In these conditions, the Algerian population cannot take advantage of
its potential wealth.
â IV. - THE ALGERIAN POPULATION â
Since the beginning of the 1960s, the Algerian population has tripled to over 38 million inhabitants. This growth
masks a substantial drop in the fertility rate (2.1 children per family in 2012 against 7.4 in 1970), partly due to
women marrying later and girls enjoying a higher level of education. Very few women go out to work, however
(20% of a 12 million-strong labour force).
For a while, the ârentierâ economy neutralised the drivers of demographic transition (Fargues, 2000). The oil
counter-shock of 1985/86, and the massive drop in oil revenues led to shrinking incomes and a general fall in
fertility throughout the Arab world. This phenomenon also affected other Muslim countries which were even
more closed, such as Iran (Ladier-Fouladi, 2005). In fact, fertility halved in one generation, a situation that
reflected a âcomplete demographic reversalâ (Fargues, 2000). The demographic transition began late for the
Maghreb/Machrek countries compared to Latin America or Asia, but once it took hold, the mutation was rapid.
The fall in fertility is a sign of deep-seated changes to societies on the south of the Mediterranean (challenging
the patriarchy and a shift in the status of women).
In the last few decades, despite a redistribution of part of the revenue from oil, there is little sign of a rise in
living standards of people either in towns or in the countryside. However, despite its relatively modest rate of
GDP, Algeria has steadily improved its position in terms of human development, despite the economic and
political turmoil.
6. 5
Today, under 25 year olds account for the bulk of the population in the countries south of the Mediterranean,
or what we could call the âpost-Islamicâ generations (Roy, 2007) who are âdetached from the nationalist and
anticolonial memoriesâ (Stora, 2011) and have a strong leaning towards the consumer society.
In the 1990s, Algeria was confronted with an acute identity crisis in religious, economic, social and cultural
terms. This crisis had an extremely negative impact on its global economy, which still reverberates today at the
beginning of the 21
st
century. The damage includes the destruction of many of its infrastructures. However,
infrastructures were not the only aspects to suffer. In addition to the armed conflict, the economic crisis, high
unemployment, and poor working conditions and social services, there was an exodus of top and middle
managers which resulted in significant demand for foreign skills. Moreover, the gap remains wide between
educational supply and demand. In most instances, the programmes available in higher education do not
match the requirements of business, skills are rare and firms find it extremely difficult to recruit the right young
people. The higher education sector and course organisation is managed in a bureaucratic manner which is ill
adapted to the needs of business. Higher education is far removed from its main consumers, in other words,
business leaders, unions, and employer organisations. This leads to dysfunctional decision-making and
responses from the education system, which is poorly adapted to the development requirements of business
organisations or those of the country.
â V. - MANY UNCERTAINTIES â
The countryâs financial situation is healthy: there is practically no external debt (it was reimbursed earlier than
planned) and the country has large foreign exchange reserves (200 billion dollars). The country experienced an
upturn in 2002, due to the rise in oil and gas prices as Algeria is a major exporter of both (thanks to its two
offshore pipelines which deliver gas to Europe). The production structure was distorted in favour of energy and
at the expense of the manufacturing industry which has continually lost ground despite the massive
government investment in industry to provide Algeria with âindustrialising industries.â
Some large, private local groups are now developing, such as Cevital (which made headline news in France in
2014 with the acquisition of Fagor Brandt) and Soummam in the milk industry.
A certain number of infrastructures have been built, such as the underground in Algiers and the East-West
motorway, designed to cross the whole of Algeria alongside the Mediterranean coast. This motorway links the
town of Maghnia (on the Moroccan border) with El Tarf (on the Tunisian border), passing through all the main
Algerian towns including (from west to east) Tlemcen, Oran, Chlef Alger, Setif, Constantine and Annaba, and
covering a distance of almost 1200 km. However, Algeria lacks many crucial skills, with obsolescent
infrastructures in all of the countryâs key sectors. This led to a mass exodus of academics and top managers
and, consequently, a call for foreign skills and competencies for major projects (Schiere and Walkenhorst, 2010;
Brahimi et al., 2011). In addition, the number of administrative obstacles and the low level of human capital
among the young generations make it very difficult to start a business.
Many issues are a cause for concern:
- the absence of any real tourist industry, due to the dilapidated state of a large number of tourist
infrastructures and the decison to close the country to foreign influence following independence;
- the economy has little foreign investment (the 49/51 regulation forbids foreigners from having a the
majority shareholding in a firmâs capital, which means foreign investors have to find a local partner);
- some years, Algeria imports over 40% of its requirements in cereals, placing the population in a
position of food dependency. This catastrophic situation is linked to: 1/ the choices made after
independence (Alpha et al., 2012; Bedrani and Cheriet, 2012); 2/ the amount of land lying fallow; 3/
persistently poor harvests (little use of fertilizers and lack of soil preparation); 4/ uncertainty over
government policies, and its inability to take a clear position (to maintain the state-owned land and
property system or to privatise farms). A genuine food supply chain still needs to be developed,
7. 6
although vertical integration of activities exists in some sectors such as milk and sugar (Achabou et al.,
2014) ;
- lack of diversification in the countryâs exports, with oil and gas tax revenues financing almost 75% of
the state budget. The importance of natural resources and the public sector (Chauffour, 2011) appear
to be obstacles to regional trade integration in the Arab Maghreb Union (Algeria, Morocco and
Tunisia);
- of the 183 countries mentioned in the Doing Business report (World Bank business climate index),
Algeria ranks 137
th
, and itâs position has fallen steadily. It is also 111th out of 180 countries in the
Transparency International report that publishes an index on the perception of corruption.
- In the building and civil engineering sector, local companies are unable to take part in major
infrastructure construction programmes. As Brahili et al. (2014) explained: "Among the problems in
the building and civil engineering sector, we can mention (1) the lack of a real human resource policy,
(2) the lack of formalised skills identification, (3) anarchic recruitment, with little or no consideration
given to qualifications and even less to personal qualities such as know-how or motivation, and (4) the
building and civil engineering sector remains too traditional and consequently lacks any leading edge
technologies.â
The more liberal trade policy (initially imposed in 1994 through a structural adjustment programme designed
by the IMF), subsequently more or less well assimilated, shows that the governing bodies can change the rules
in order to hold onto power. This explains why the more liberal approach to international markets has not
changed Algeriaâs integration in the global economy, and has not led to greater diversification in production,
imports or exports. The unfinished nature of the reforms, the absence of a real group of entrepreneurs
investing in industry (Aliouat, 2012; Grim, 2012), and the predominance of consumer goods in the import
structure can all be explained primarily by a distribution conflict regarding oil revenues. The protection of
property tights remains uncertain, even though there is consensus that the institutions are central to the
economic development process (World Bank, 2002).
Algeria remained on the side lines during the political turmoil that broke out in the first half of 2010 and led to
a significant shake-up of the North African countries, giving it the appearance of a model of stability. The
Algerians did not take part in the Arab Spring. As Martinez (2013) wrote: âIn contrast to the security problems
in Libya and the Islamist leanings of the Tunisian and Egyptian regimes, Algeria continues to offer the old-world
charm of a nationalist and military republic model which delights western diplomacies, destabilised by the
irruption of Islamist parties and civil societies on North Africaâs political stage.â Protests were diffused by wage
rises, police presence and the traumatic memories of the civil war (Morin, 2012). Algeria appears as a barrier
against the influence of Saudi Arabia and the salafi and Wahhabi movements that have pushed Islam towards
greater radicalism. Preoccupied by its own domestic problems and fearing a ripple effect, the Algerian
government did not profit from the political shakeup taking place in the Arab world or the redistribution of the
regional cards to strengthen its own external influence.
â Conclusion â
Many factors have led to the present situation. Politically speaking, the government never managed to free
itself from the methods arising from the war of independence, and power has remained in the hands of a
military clan which still rules today, and whose legitimacy is linked to the armed struggle. Its leaders are former
freedom fighters (Ben Bella, Boumediene, Bendjedid and Bouteflika). The failure of economic development
(initiated in 1962) and the democratic transition (which began in 1989) are directly linked to the incompatibility
between, on the one hand, a system that clings to power by advocating inaction and, on the other, the
legitimate changes expected by civil society. The army remains the real power in the country, but its status
poses a problem: is it a force in the service of a legal power or is it the power which defines what is legal?
In geopolitical terms, Algeria resembles a fortress under siege, as its borders with Morocco have been closed
since 1994, and those in the south with Mali and in the East with Libya are under high surveillance. While
10. 9
â Appendice 1 - Chronology â
1830 -- Algeria, Turkish colony for the XVI
th
century, becomes French.
1947 -- Adoption of a new status for Algeria.
1948 -- Discovery of oil in Sahara.
1962 -- Evian agreements. Political independence and exodus of the âpieds-noirsâ.
1965 -- Putsch of Houari Boumediene and reversal of the government of Ahmed Ben Bella.
1969 -- Algeria in the OPEC.
1971 -- Nationalization of the oil sector (economic independence).
1975 -- Occidental Sahara crisis
1978 -- Death of Boumediene. Another colonel, Chadli Bendjedid, succeeds him.
1985 -- Collapse of the oil price.
1988 -- Riots.
1988 -- Agreement for the passage of an Algerian gas main by the Tunisian territory to
reach the Italian market.
1989 -- New constitution which authorizes the multiparty system and which deletes
any reference to the socialism.
1989 -- Creation of the UMA (âUnion du Maghreb arabeâ).
1991 -- The FIS wins the first round of the elections.
1992 -- Resignation of president Chadli. Suspension of the process of democratization.
1992/99 -- Civil war.
1994 -- Plan of structural adjustment developed by the IMF. Dinarâs devaluation (40%).
1999 -- Election of Abdelaziz Bouteflika (he is reelected in 2004, in 2009 and in 2014). The civil
war is closed.
2002 -- The beginning of the rise of the oil price, pulled by emerging countries.
2013 -- Terrorist attack (Tigantourine)
2013 -- President Bouteflika is a victim of a cerebral vascular accident. The politicsâ calendar
is dominated by the question of the leadership at the top of the State.