• Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

Economics Commentary. This article deals with the development of African countries through export-led growth and export performance.

Extracts from this document...


This article deals with the development of African countries through export-led growth and export performance. Export-led growth is economic growth based on increasing exports and export revenue, a key factor in Aggregate Demand. This would mean GDP increases, resulting in higher incomes and growth in the domestic economy. This can be achieved by exploiting a country's comparative advantage. For this to happen, several criteria must be met, such as liberal trade and minimal government intervention. However, there must also be a strong provision of infrastructure. This is highlighted in the "weak supply capacity-limited ability... in Africa". Indeed, the UNCTAD senior economist Samuel Gayi raised the issues of a "shortage of reliable electric supply ... banking services and efficient transportation". Additionally, Africa's primary export is agricultural products. Due to technological improvements such as enhanced fertilisers and increased mechanisation in developed countries, supply of agricultural products has dramatically increased. ...read more.


For example, in Ethiopia, observers have recently commented that in some areas, soil is irreversibly damaged. This has long-term consequences. This could have contributed to Africa losing world export market share, despite "two decades of... trade liberalisation". Unsustainable practises may have also lowered productivity. Indeed, the article notes how Africa was once a net food exporter and has now "become the region most dependent on external food aid". The article notes the "strategic role of agriculture in Africa", implying that more focus and funding needs to be placed into agriculture. This would allow Africa to be able to feed itself. While I agree with this, I do not believe this would ultimately allow Africa to pursue export-led growth. The most commonly cited examples of export-led growth are the "Asian Tigers". These countries focused on exporting manufactured good at a low price thanks to their comparative advantage of low-cost, low skill labour. ...read more.


This would make export-led growth more feasible, as well as improving the quality of life for millions. For example, people as well as industry could have access to clean water. However, this strategy is not without its problems. This plan would not solve food problems. What needs to be done instead is development of both the Primary and Secondary Sector. This would allow African countries to supply their own agricultural needs and not rely on food imports and aid. Money spent on buying foodstuffs could be used to further increase infrastructure. In conclusion, to pursue export-led growth, Africa needs substantial investment in infrastructure, as well as renewed efforts to improve agricultural performances. This can be achieved by reliving debt, or waiving it all together. This would allow governments to invest the money, for example in infrastructure. These strategies would reverse "worrisome trends" and help Africa develop. 1 Source: Make Poverty History, Geraldine Bedell, Penguin Books, 2005 ?? ?? ?? ?? ...read more.

The above preview is unformatted text

This student written piece of work is one of many that can be found in our International Baccalaureate Economics section.

Found what you're looking for?

  • Start learning 29% faster today
  • 150,000+ documents available
  • Just £6.99 a month

Not the one? Search for your essay title...
  • Join over 1.2 million students every month
  • Accelerate your learning by 29%
  • Unlimited access from just £6.99 per month

See related essaysSee related essays

Related International Baccalaureate Economics essays

  1. World Economics assignment. The core economic issues that are focused on in this ...

    No matter Tourists or citizens, they do not need to care about more money will be spend because of changing exchange rate. Besides, it renders purchasers convenient and efficient shopping, most essentially, a wide range of selections of goods and considerations without additional expenditure.

  2. An Investigation of Vietnam's Barriers of Economic Growth and Development

    The Human Development Index (HDI) re-illustrates Vietnam's lower development and welfare. It weighs real national income per year, the adult literacy rate, average years of schooling, and life expectancy in ranking a country in terms of development. The closer the HDI value is to 1, the more developed the country is said to be.

  1. Economics Article Commentary - The article deals with the raise of a tariff on ...

    Seeing both governments ?working? against each other with protectionist measurements is not only harmful to the world as an economy, but also to the domestic economies of both countries. Although they could simply shift their labour in the U.S., if the restriction of labour mobility is non-existent and therefore structural

  2. What are the stages in economic development? Discuss this in reference to at ...

    his income through his hard work manifested in the additional crop production. With a surplus at hand and health facilities improving, farmers grew healthier. Not having to spend money on the diseases and rapidly erupting epidemics, the farmers were able to afford higher education for their children, who in turn became skilled farmers and businessman.

  1. Economics Commentary- Prices of onions jumped yesterday, buoyed by a ban by India on ...

    The LCs came to a halt following the ban on exports, said Islam of the C& F Agents Association. The disruption in supply from India led to the hike in the prices of locally produced onions, said Mohammad Aminul Islam, an onion wholesaler at Karwan Bazar.

  2. 15 Historical Economic Questions on Mercatilism and the Development of European Countries.

    Describe Mercantilism. What explains this? Mercantilism entails the theory that a country?s power depends mainly on its wealth to build strong navies and purchase vital trade goods. Vital trade goods that individual nations sought after were gold, ships, and trade routes. Ships were desirable because they were the primary means of international trade at the

  1. Economics commentary. This article is about the performance of Germanys economy in the coming ...

    Yet, market diversification comes with its difficulties as well such as understanding the cultural, regional differences or current problems in the potential market through researching, planning, marketing. This process costs highly and does not guarantee success in the new market.

  2. What is driving the Philippines' surprisingly strong growth

    of improved stability" with more investments, lower inflation, currency valuations going up and interest rates coming down. Other factors that have aided in the country's growth early this year are the transfer of operations to the Philippines from Thailand by flood-disrupted businesses, said Teather, as well as improved electronics exports.

  • Over 160,000 pieces
    of student written work
  • Annotated by
    experienced teachers
  • Ideas and feedback to
    improve your own work