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A fairer distribution of the benefits of globalization by .paul riesz 30 March 2001 19:44 UTC |
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Dear Mario José: To invalidate my argument that a well regulated and supervised globalization MUST be beneficial for both sides, you said: "This could be true if comparative advantages prevailed. In the truth, absolute advantages in the relations between north and south prevail. The results of the development of the North, therefore, are harmful & trim the populations and the environment of paises in the periphery." To have a really effective argument. you would have to prove, with concrete examples, that international trade NEVER takes account of comparative advantages. I do not think, that you could do that. It is true, though, that many comparative advantages have not yet been developed; especially in the 3rd world. That is why I am recommending the type of industrial policies, that have been so effectively practiced by Japan, South Corea, Taiwan and other Asian Tigers. Therefore developing countries should NOT accept regular membership in the WTO, defending among others, their right to promote investments where they could have the greatest beneficial effects. Allow me to illustrate this argument from a Chilean viewpoint. Chile is one of the worlds most important suppliers of copper, but exports it as enriched mineral or, at best, after smelting, as metallic copper. To improve the situation, Chile should condition the granting of new mineral concession on the obligation to export only products with more added value; e.g. transmission cables etc. Another example: Chile almost completely lacks its own oil or natural gas and produces a lot of electricity with natural gas, imported from Argentina. Nevertheless the country could produce electricity - at competitive prices - from their own sources of energy, such as geothermal-, hydro-, wind- and (somewhat later) solar power. Incentivating investments in such projects, Chile would immediately save a lot of badly needed foreign exchange, be able to EXPORT electricity to neighboring countries in the relatively near future and could become a world-class supplier of hydrogen, once the price of oil multiplies (something that could happen within the next 10 or 15 years). Regards Paul
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