Mustering resources, whetting skills for the global economy
Editorial
ONE consistent complaint of the leading financial institutions is that developing countries are not moving fast enough to join the World Trade Organisation (WTO). Defenders of the doctrine of global capitalism have criticised poor countries for failing to open up to the world economy thereby creating severe disparities and the threat of a permanent gap between fast and slow integrating economies. It seems to be the received doctrine that if underdeveloped countries are to survive in the new millennium, when free trade will be the new world order, they must take the necessary painful steps of liberalising their economies. Regional trade agreements are proliferating, capital investment is rebounding from the financial crises of the latter half of the 1990s, and reform and integration are being promoted as the central tenets of economic development. But, one may ask, how easy is it for Third World countries to implement these reforms when in reality they are burdened by external debts and are, most of them, far too poverty- stricken to even initiate the process of reform? Just last week, Caribbean leaders were almost with one voice articulating their protests about the inequities of the international trade systems, which for the most part, militate against poor nation states. THE ECONOMIST of September 25, 1999 notes that poor countries are cynical about western governments' commitment to free trade with good reason. In the article captioned "White man's shame", the magazine points out that "America and Europe are forever lecturing developing countries about the need to open their markets, yet they do their best to keep out many poor-country exports". The article goes on: "Developing countries have three big complaints. First, they are being forced to open their markets too far, too fast. Second, rich countries are conspiring to keep their markets closed. And third, they lack the resources and information to negotiate effectively, to implement trade agreements and to exploit world trade rules to their advantage." THE ECONOMIST argues that the first complaint "is wide of the mark" since poor countries can actually benefit from opening their markets because consumers can buy cheaper imports and foreign competition spurs domestic producers to greater efficiency. We would beg to disagree with this particular argument since the experience of cheaper imports flooding the local market has threatened to decimate local production. For instance, imported beer has played havoc with the sales of local beer produced by Banks DIH. Shelves are laden with foreign condiments, jams and jellies while manufacturers of local substitutes are going out of business. Seamstresses are losing clients who purchase each imported garment for a fraction of what it would cost custom-made. Economists maintain that all is not lost for poor countries, but for those countries to survive and prosper they must upgrade their efficiencies in transportation and communication. They must also re-train workers and re-tool manufacturing equipment to achieve greater competitiveness. The wry aspect of this preparation is that scholars estimate it can cost "more than a year's development budget for the poorest countries".
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