Most high-income countries have liberalization privatization globalization pdf the path of economic liberalization in recent decades with the stated goal of maintaining or increasing their competitiveness as business environments. Success will go to those companies and countries which are swift to adapt, slow to complain, open and willing to change.
The task of modern governments is to ensure that our countries can rise to this challenge. In developing countries, economic liberalization refers more to liberalization or further “opening up” of their respective economies to foreign capital and investments. Many countries nowadays, particularly those in the third world, arguably have no choice but to also “liberalize” their economies in order to remain competitive in attracting and retaining both their domestic and foreign investments. However, North Korea is not completely separate from the global economy, since it receives aid from other countries in exchange for peace and restrictions in their nuclear programme. The adoption of economic reforms in the first place and then its reversal or sustenance is a function of certain factors, presence or absence of which will determine the outcome. The author’s theory is fairly generalizable and is applicable to the developing countries which have implemented economic reforms in the 1990s. The service sector is probably the most liberalized of the sectors.
Liberalization offers the opportunity for the sector to compete internationally, contributing to GDP growth and generating foreign exchange. India’s IT services have become globally competitive as many companies have outsourced certain administrative functions to countries where costs are lower. Furthermore, if service providers in some developing economies are not competitive enough to succeed on world markets, overseas companies will be attracted to invest, bringing with them international best practices and better skills and technologies. Trade liberalisation carries substantial risks that necessitate careful economic management through appropriate regulation by governments. Some argue foreign providers crowd out domestic providers and instead of leading to investment and the transfer of skills, it allows foreign providers and shareholders “to capture the profits for themselves, taking the money out of the country”. Thus, it is often argued that protection is needed to allow domestic companies the chance to develop before they are exposed to international competition.
Risk of increased inequality across race, ethnicity, or gender lines. For example, according to the anthropologist Lilu Abu-Lughod we see increased gender inequality in new markets as women lose labor opportunities that existed prior to market liberalization. For instance, there is a risk that private providers will ‘skim off’ the most profitable clients and cease to serve certain unprofitable groups of consumers or geographical areas. Yet such concerns could be addressed through regulation and by a universal service obligations in contracts, or in the licensing, to prevent such a situation from occurring.
Examples of such an approach include South Africa’s Financial Sector Charter or Indian nurses who promoted the nursing profession within India itself, which has resulted in a rapid growth in demand for nursing education and a related supply response. Why Is China Growing So Fast? A Discursive Dominance Theory of Economic Reform Sustainability: The Case of India”. This page was last edited on 24 October 2017, at 01:07.