National Press Club

Industrializing Amidst a Global Financial Crisis: Is it Possible?

National Press Club

529 14th St. NW, 13th Floor, Washington, D.C.

Mar 12, 2009



Center of Concern and the Heinrich Böll Foundation

Featuring as a speaker:      
Prof. Ha-Joon Chang, Faculty of Economics, University of Cambridge

Mr. Rogerio Studart, Alternate Executive Director for Brazil, World Bank
Mr. Mark Weisbrot, Center for Economic and Policy Research

Moderator: Liane Schalatek, Heinrich
Böll Foundation

In the half-decade that preceded the start of the global financial turmoil, developing countries lived through a period of economic boom. This boom was fueled by an extraordinary increase in export income due, in a large number of cases, to skyrocketing prices for commodities. It did not necessarily reflect an increase in the value-added, or a substantial change towards more industrialized content, of production.

Now that the financial crisis put an end to several bubbles, including the one around commodities, important challenges are faced by developing countries. On the one hand, a high degree of commodity dependence and lack of diversification, in economies shaped to strongly rely on exports, conspire to magnify the impact of trade trends on developing countries’ revenue. On the other hand, such trends may intensify. In light of the global recession and lower revenue, escalating to products with higher industrial content might become even more difficult, while at the same time more necessary than ever before to secure developing countries’ future.

The panel sought to analyze these trends and provide responses to the following questions:

  • In which way does the financial crisis affect developing countries’ space to implement an industrial policy?
  • Do revenue losses from lower commodity prices make it harder for them to manage a move towards industrialization ? Does the crisis open opportunities for building industrial capacity?
  • Given the context, is it still recommendable that they move towards more industrialized production capacity? If so, what are domestic and external measures that could help them do so?
  • In the light of growing protectionist threats, how relevant to the success of such measures is the degree of access to Northern markets?

This event was co-sponsored by the Center of Concern and the Heinrich Böll Foundation.

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