Modern Services Exports from Emerging Countries—Perspectives and Opportunities

Advancements in information and communications technologies (ICTs) have increased the possibilities for trade in modern services and many emerging economies are participating increasingly in these new trade activities. This paper explains the sources of increasing modern services exports from emerging countries, and the opportunities for future growth. The paper reviews selected theories and empirical work in the trade literature to explain the underlying reasons for these increasing exports. The paper finds that emerging countries are well placed for modern services exports due to the increasing services outsourcing that offers substantial benefits to importing economies, and the comparative advantage of emerging countries, which has been facilitated by declining trade costs and advancements in ICTs. Nonetheless, only few developing countries could fully exploit these opportunities.