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The New Globalizers Many developing countries—sometimes known as the ‘new globalizers’— have made huge progress in building and sustaining a strong position in world markets for manufactured goods and services. ‘New globalizers’ have exploited their competitive advantage in manufacturing which is based on:- fast growth of labour productivity, much lower unit labour costs, high levels of capital investment, (much of it linked to inward investment) crucially a reduction in the tariff levels imposed by industrialised economies. Technological progress and improvements in containerisation and airfreight has also reduced the costs of transportation. Developing countries have become important exporters of manufactured goods Many developing countries have exploited the fast growing demand for transistors, valves, semi-conductors, telecommunications equipment, electrical power machinery, office machines, computer parts and other electrical apparatus. Prices though are falling as production shifts across the globe to lower cost production centres. The huge increase in out-sourcing of manufacturing production has been a major factor behind the speedy growth of export industries in many developing countries, not least the emerging market economies of south East Asia and more recently in eastern Europe. China Production of factory goods in China has surged by 5-10 per cent a year for over a decade and China now contributes an estimated seven per cent of global manufacturing production. China has huge comparative advantages and has had high foreign direct investment. R&D spending in China is rapidly increasing. Brazil, India and Russia are also experiencing huge growth rates. |