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Building Productive Capacities: Challenges and Opportunities for Least Developed Countries

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  • Clovis Freire

    (Macroeconomic Policy and Financing for Development Division, ESCAP)

Abstract

Building productive capacities is a top priority for least developed countries to promote development and graduate from the status of least developed country. This paper discusses the challenges and the opportunities for these countries to build their productive capacities. It argues that the main challenge is to manage the long-term effects of the increase in the terms of trade of commodities and reduction of terms of trade of manufactures, which threaten their growth trajectory. The paper presents a method to identify the opportunities for diversification that promotes the generation and acquisition of productive capacities. It also presents a list of potential new products and export markets that could be targeted by government and private sector for achieving higher long-term gains.

Suggested Citation

  • Clovis Freire, 2012. "Building Productive Capacities: Challenges and Opportunities for Least Developed Countries," MPDD Working Paper Series WP/12/02, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
    • Handle: RePEc:unt:wpmpdd:wp/12/02
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    File URL: http://www.unescap.org/pdd/publications/workingpaper/wp-12-02.pdf
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    References listed on IDEAS

    as
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    4. Hausmann, Ricardo & Hidalgo, César A., 2010. "Country Diversification, Product Ubiquity, and Economic Divergence," Scholarly Articles 4554740, Harvard Kennedy School of Government.
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    7. Williamson, Jeffrey G., 2011. "Trade and Poverty: When the Third World Fell Behind," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262015158, December.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Productive Capacity; Least Developed Countries; Economic Development;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O57 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Comparative Studies of Countries

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