The New Globalizers
Many developing countries—sometimes known as the ‘new globalizers’— have
made huge progress in building and sustaining a strong position in world
markets for manufactured goods and services.
‘New globalizers’ have exploited their competitive advantage in manufacturing
which is based on:-
fast growth of labour productivity,
much lower unit labour costs,
high levels of capital investment, (much of it linked to inward investment)
crucially a reduction in the tariff levels imposed by industrialised economies.
Technological progress and improvements in containerisation and airfreight
has also reduced the costs of transportation.
Developing countries have become important exporters of
Many developing countries have exploited the fast growing demand for
transistors, valves, semi-conductors, telecommunications equipment,
electrical power machinery, office machines, computer parts and other
Prices though are falling as production shifts across the globe to lower cost
The huge increase in out-sourcing of manufacturing production has been a
major factor behind the speedy growth of export industries in many
developing countries, not least the emerging market economies of south East
Asia and more recently in eastern Europe.
Production of factory goods in China has surged by 5-10 per cent a year for
over a decade and China now contributes an estimated seven per cent of
global manufacturing production. China has huge comparative advantages
and has had high foreign direct investment. R&D spending in China is rapidly
Brazil, India and Russia are also experiencing huge growth rates.