STWR - Share The World's Resources

Many Developing countries are left with little choice other than to compete for trade in international markets, leaving them trapped between a rock and a hard place.

The collapse of WTO trade talks earlier this year was both a boon and a bane for developing countries.

Take India, for example, where nearly half of the population (some 400 million people) live in poverty. India recently embraced economic globalisation and opened its markets to high-income countries. Given the size of its work-force, even a slight increase in Indian exports can create a significant financial benefit for the country’s GDP.

Arguably, the collapse of the Doha round was detrimental for India, as a major opportunity to increase its access to foreign markets was lost. Many ‘emerging economies’ are in a similar position and, left with little alternative, find it necessary to participate in the biased neo-liberal trade regime.

Neo-liberalism originated in Washington after the Second World War, and was first globalised during the Regan-Thatcher-Kohl era. The IMF, World Bank and WTO still propagate this ideology which holds, at its core, the competitive, profit driven imperatives of multinational corporations.

International trade has been successful at increasing average income levels in many countries. However, the share of world trade for the 50 least developed countries has declined to less than a third of what it was 40 years ago.

Trade fuels economic growth. But during the period between 1981 and 2001, 95% of global economic growth went to those who live above the two dollars a day poverty line, and the share of poverty reduction through economic growth fell from 5.5% in the 1980s to 3.1% in the 1990s.

Thus the story is very different for the least developed countries whose economies aren’t ‘emerging’. For them, globalisation mainly benefits investors and corporations based abroad. Unlike India, the marginal benefits of towing the neo-liberal line in these countries are minimal.

Almost half of the world’s population lives in poverty. For these people economic globalisation, in its current form, is a bane. They require a significant transfer of resources from high-income countries, domestic food security and the development of locally owned industry.

Resuming the Doha trade talks will not deliver these essentials as long as corporate interests drive global economic policy.

More information and analysis on the existing international trading system and its alternatives can be found here. 

Rajesh Makwana is the Director of Share The World’s Resources(www.stwr.org) , an NGO campaigning for global economic and social justice. He can be contacted at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it .

Copyright 2007 Share The World’s Resources (www.stwr.org)

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