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Ostguyan
Ostguyan
Ostguyan
www.unctad.org/infocomm www.natural-resources.org/minerals
Economic characteristics
Few barriers to entry Productivity gains tend to be passed on Fluctuating prices
Commodity groups
Shares of world exports, 1997 - manufactures: 75.1% - food items: 8.6 % - fuels: 7.8 % (1980: 24%) - ores and metals: 3.3 % - agricultural raw materials: 2.4% - non-classified, including nonmonetary gold: 2.8% Growth rates, 1980-97 8.1 % 4.5 % -0.8 % 3.8 % 3.4 %
As a group, developing countries have become less reliant on commodity exports However, out of 140 developing countries, 83 depend on commodities for more than half of their export income, almost the same number as in 1990.
97-99
44 31 84 47 74 65 74 48 65 82 10
Agricultural protectionism
Dynamic sectors least protected
In poorer countries
19
19
19
19
19
19
19
19
19
19
20 M
Combined index
Tropical beverages
Food
ay
20
02
82
86
88
90
92
94
96
00
80
84
98
81
83
85
86
90
93
95
96
80
87
97
00
84
88
91
94
98
82
89
92
99
01 M ay
19
19
19
19
19
19
19
19
19
19
19
19
19
20
20
19
19
19
19
19
19
19
Tropical beverages
Food
20
02
5%
10%
15%
1970-72 1996-97
Agricultural tariffs:
- Agricultural tariffs (average 62 %) much higher than for manufactured products (average 5 %) - Complicated mixed with TRQs, ad valorem and specific tariffs, complex technical relationships - Multitude of preferential rates - Tariff escalation especially for meat, sweeteners, vegetable oils
High tariff sectors Tobacco, meat, dairy and sugar Low tariff sectors Fruit, vegetables and fish BUT Few TRQs, minimum prices, vary with prices
Subsidized exports from developed countries displace developing countries in their own and third country markets
Total support to agriculture in OECD in 2001 was $311 billion; support per farmer was US$ 33,000 in Switzerland, US$ 20,000 in the E.U., Japan and the United States
Increasingly, traditional developing country products are processed and/or branded in developed countries, and re-exported
Developed countries are accounting for larger shares of tropical product exports. US exports of coffee and coffee products continue increasing and reached a record level of $250 million from about $175 million five years ago. (Largest exporter Brazil and all of subsaharan Africa - about $2 billion each)
1990-92
1998-2000
Developed country exports
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Ri ce
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Fr u
Su ga
To b
Ve ge
ta b
le s
Fr ui ts
Ri ce
ca
cc o ba To
ar
Su g
Ve g
et
ab
les
ne
Retail sector
Global supermarket chains
Policy issues
International community
Reduce agricultural protectionism and subsidies Harmonize standards Allow protection of crucial sectors for single commodity exporters and food importing countries Establish safety nets against catastrophic price falls Provide market information
Governments
Integrate subsistence farmers in the monetary economy Facilitate access to credit, regulatory frameworks Improve transportation and storage Complement liberalization with institution building Improve information flows
Fish
Rapid growth in demand Compliance with standards costly
Spices
Rapid growth in demand Easy to enter market, risk of oversupply
19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00
19 91 19 92 19 93 19 94 19 95 19 96 19 97 19 98 19 99 20 00
Investment climate
Most developing countries have updated legislation on FDI, on mining or on both Nationalizations unlikely Political stability
Financing methods
Project lending Gold loans, commodity bonds (not very common now) Equity capital (easy until a few years ago)
Gold
Low prices, official reserves still a threat Financing for small ventures problematic