Economic Development Trends for Global Regions 2

Economic Development Trends for Global Regions 2

1. From the late 70's and into the 80's. many poorer countries began to catch up faster with richer ones, and within those countries richer people gained wealth faster than poorer people. The surge in emerging markets began with China's open door policy. By 2000's the majority of emerging economies were growing faster than rich countries, to such an extent that global inequality started to fall, even as the gaps within many countries increased. The port of Ningbo-Zhoushan is located on the coast of the East China Sea. It provides evidence of China's rapid growth; this port is now the busiest in the world in terms of cargo tonnage.

2. The huge changes that have swept the world economy (globalisation, deregulation, the IT revolution, and the associated expansion of trade, capital flows and global supply chains) all narrowed the income gaps between countries, yet widened them within countries at the same time.

3. The global reach of the modern economy hugely increased the size of markets and the rewards to the most successful. New technologies pushed uo demand for well-educated people, boosting the incomes of skilled workers. The integration of some 1.5 billion emerging economy workers into the global market economy boosted economic return, ensuring that the 'haves' would have more. It also exposed low-skilled workers in development economies to competition from low-skilled workers in emerging economies. The relatively high wages of low skilled workers in the developed world put them at severe disadvantage and as a result these groups have experienced unemployment and wage uncertainities due to globalisation. This si shown by the clousure of steel works in the UK at the beginning of 2016, when Indian company Tata decided that it was no longer economical to run them.

4. Since 1970, the average income per capita in Asia has leapt over the absolute poverty threshold (driven in particular by the moderinsation of Japan and South Korea). Asia's 2010 figure of roughly US$7000 per capita is equivalent to about US$20 per day, well in excess of the absolute poverty threshold of US$1.25 per day. Incomes in Japan have remained closer to the poverty line. However, it is important to distinguish between different regions with Africa.

5. Large income gains have been made in Tunisia, Algeria and other parts of the Maghreb region. North Africa in general is far more 'switched on' to globalisation (in part due to outsourcing by French TNCs). Elsewhere, some of Africa's coastal hubs, for example, Lagos, Nairobi and Cape Town (Nigeria, Kenya, and South Africa respectively), are growth engines for a handful of important emerging economies. Economists predict a bright future for these places, provided political upheavals to not derail the economic development process. They expect strong African middle-class growth to rival Asia over coming decades.

6. In contrast, poverty remains entrenched in some sub-Saharan countries, including Burundi and Central African Republic. In several places, a toxic cocktail of geographical isolation (lack of coastline), poverty and political extremism has resulted in falling life expectancy due to conflict. Human rights abuses are widespread and progress towards gender equality has been set back decades by the spread of extremist political organisations including the Lord's Resistance Army in Uganda and militant Islamists in Mali.