Introduction

As is the case in advanced countries, in newly industrialising economies (NIEs), international trade can be considered an important source of the ‘wealth of nation’ within their domestic markets. In order for latecomers to survive (Hirst and Thompson, 1999), the notion of international competitiveness in conjunction with export-driven market-creation has tended to become the primary concern of the policy-makers in industrialising countries. In the case of East Asia, Lall (2001: 1502) suggests that ‘competitiveness is considered a matter of national economic survival’. With this over-riding importance of international trade to the NIEs, it appears that the South has no alternative but to rely on a high level of export-oriented output in order for its developing economies to survive. For example, in terms of trade to GDP ratio, Korea accounted for 69 per cent, compared to 17 per cent for the EU, the US 25 per cent, and Japan 19 per cent (Hirst and Thompson, 1999: 149). Despite a body of literature on the Smithian market mechanism, it cannot be denied that a variety of industrial policies and strategic trade policies, aggressively orchestrated by national governments, especially the ‘developmental state’ Uohnson, 1982; Amsden, 1989; Wade, 1990a; Woo-Cumings, 1999; Turner and Y. C. Kim, 2004), have contributed to a considerable extent to the advantages of ‘competitiveness’ in world markets.