This paper discusses major policy issues related to commodity dependence and export diversification in low-income countries. Contrary to some widely-held view, it argues that natural resources are not necessarily a ‘curse’ that condemns low-income countries to underdevelopment but can provide a basis for sustained export-led growth. Natural resource-based sectors have potential for export diversification. The OECD ‘mirror’ trade data indeed suggest that many different routes to diversification exist, including resource-based manufacturing and processing of primary products. However, these opportunities are far from being exploited in many low-income countries. This is because export diversification is typically a slow process, and this process needs to be sustained by an appropriate and coherent strategy, characterised by a combination of vision, co-ordination and management of conflicting interests. Moreover, the analysis of trade support services in two African countries points to a mismatch between private sector’s needs and services actually provided and to a limited institutional development of the trade and investment support network. The lessons for trade capacity building are important for Africa but are also relevant for other low-income countries.
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Length: 46 pages Date of creation: 02 Jul 2003 Date of revision: Handle: RePEc:wpa:wuwpdc:0307001
Note: Type of Document - Acrobat pdf; prepared on IBM PC; to print on HP; pages: 46 ; figures: included Contact details of provider: Web page: http://129.3.20.41
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