Changing Participation Of Developing Countries In World Trade

Question: Discuss about the Changing Participation Of Developing Countries In World Trade. Answer: Introduction The study focuses on the changing participation of developing countries in world trade. Developing nations play significant role in global trade. The rise in exports in Middle East, Central Asia and North Africa over the last few years has further raised the weight of developing nations in trade (Mann Afzal, 2013). In most of the developing nations, trade has developed at much faster rate and hence their participation in global trade led to growth in their respective economy. In recent years, it has been noted that substantial decrease in the trade policies as well as barriers inhibits the participation of developing nations in trade. Application of this article in professional life and organization The liberalization in trade has occurred slowly in the developing nations. Tariff as well as non- tariff barriers that include quotas, licences became ubiquitous. Moreover, restrictions in foreign exchange often imposed huge extra taxes on these nations trade. The protective influence of quotas, tariffs and licenses in these developing nations are reinforced by deformations in the market of foreign exchange (Amiti Cameron, 2012). These deformations involve overvaluation in exchange rate along with methods for allocating limited foreign exchange. In addition, the policymakers of few developing nations mainly aim their effort in General Agreement on Tariffs and Trade (GATT) on attaining enhancement in entre to the markets of industrial nations under special treatment. This approach facilitates most of the developing nations by enhancing their TOT (terms of trade). On the contrary, it has negativeeconomic consequences in few developing countries. The developing nations also brought ref orms in trade patterns by lowering their barriers in trade and increasing exports of manufactures (Whalley, 2016). This leads to rise in the manufactures share. The underlying reasons behind these changes in export patterns in the developing nations include- High accumulation rate of both human as well as physical capital Rapid increase in education per labourers in the organizations This changing participation of developing nations in global trade influences both the personal life and the organizations. Decline in trade barriers improve the living standards of the people in the developing nations. This specially benefits the poor people as creation of several new jobs occurs for unskilled labourers, which raises them to middle class. As a result, personal or professional life of people improves and thus leads to decline in inequality among the nations. As the manufacturing sector remains a vital force in developing economies, this reduction in trade barriers and rise in exports of manufactures brings new opportunities as well as challenges to the organizations (Kunnanatt, 2013). Opportunities come in the way of entering in new markets, switching over to new resources or technology and expansion of business in global market. On the other hand, the organizations face challenges of huge competitiveness of other nations regarding RD capabilities, innovations in designing of product and expertise workers in data analytics. Conclusion From the above assignment, it can be concluded that this changing participation of developing nations in trade increases the overall income of the respective economies. Moreover, it reduces the poverty level in the nations and opens new opportunities for business organizations. This in turn increases the Gross Domestic Product (GDP) of the developing nations. References Kunnanatt, J. T. (2013). Globalization and developing countries: A global participation model. Economics, Management and Financial Markets,8(4), 42 Amiti, M., Cameron, L. (2012). Trade liberalization and the wage skill premium: Evidence from Indonesia.Journal ofInternational Economics,87(2), 277-287. Whalley, J. (Ed.). (2016).Developing Countries and the Global Trading System: Volume 1 Thematic Studies from a Ford Foundation Project. Springer,55(1),88-95 Manni, U. H., Afzal, M. N. I. (2012). Effect of trade liberalization on economic growth of developing countries: A case of Bangladesh economy.Journal of Business Economics and Finance,1(2), 37-44.