Weak Links?

Ulhas Joglekar uvj at vsnl.com
Fri Dec 13 07:58:52 PST 2002


Yoshie Furuhashi wrote:


> >Which nations in Asia depend on exports of primary commodities?
> >Afghanistan, perhaps? If you exclude petroleum products, primary
> >commodities contribute less than 12% of the developing country
> >exports. China, India and Indonesia depend on exports of primary
> >commodities?
>
> Michael L. Ross's article above does not discuss Asia (unless we
> consider the Middle East to be part of Asia). I don't know why you
> think we need to exclude petroleum from analysis.

Depends on what you are trying to find out. If you want to know, how many people in the developing world depend for their livelihood on exports of primary products, inclusion of oil exports gives a distorted picture. Oil exporting countries in and around Persian Gulf are typically small, thinly populated nations. Oil exports account for bulk of their exports. This is exceptional. Further, oil is a different kind of commodity than, say, coffee or bananas.

On the contrary, East, South East and South Asia are net importers of oil and gas in large quantities. As I wrote earlier, exports are 10% of India's GDP and primary commodity exports are 15% of the total exports. The impact of primary commodity exports, deteriorating terms of trade etc. on the working population is small. You could estimate how much exports of primary commodities matter to the people of developing nations, if non-oil exports are 12% of developing nations' exports.


> >Exports are not always decisive for economic growth. India's exports
> >are about 10% of the GDP.
>
> We can draw a variety of conclusions from your statement above.

What are these conclusions?

Ulhas



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