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    Turning LDC Export Opportunities Into Business

     

     
     
    © International Trade Centre, International Trade Forum - Issue 3/2001

    The ITC and Government of Norway Business Sector Round Table (BSRT) held on 16 May 2001 at the Third United Nations Conference on the Least Developed Countries (14-20 May 2001) put a surprising spotlight on the situation of the world's 49 poorest countries. The BSRT showed that many exceptional entrepreneurs from least developed countries (LDCs) have been able to achieve export success - often with important benefits for their workers and communities. Twenty went to Brussels to tell their LDC success stories to the more than 250 people - business executives and senior trade officials from LDCs along with multilateral agency and donor government representatives - who took part in the round table. We gathered many more of these success stories, which are featured on the BSRT web site (http://www.intracen.org/bsrt/) and in our publication on turning LDC export opportunities into business.

    ITC conceived the BSRT as an opportunity to analyse and reveal export potential in LDCs as a whole, focusing on those sectors of particular importance to least developed countries, and highlighting constraints as well as opportunities. Selected LDC exporters would tell their stories, demonstrating how they were able to overcome often formidable constraints and 'make it' in the highly competitive international environment. Export strategy processes under way in LDCs would be considered along with the enabling circumstances needed to replicate these exceptional export successes on a much wider scale. Finally, it was decided that a book, prepared for wide distribution in LDCs, would document the discussion and experience and serve as a 'road map' for export development over the ensuing years.

    Profiles of promising LDC markets

    The research carried out for the BSRT put together, we think for the first time, profiles of 13 sectors that look particularly promising for LDCs. In order of their present importance for LDCs in international trade, they are: cotton fabric and clothing; tourism; seafood; business and professional services; coffee; cotton and fibres; wood and wood products; oilseeds; fruits and nuts; vegetables; spices; cut flowers and foliage; and medicinal plants. They are reviewed in this issue of Forum.

    Success stories: common themes

    We devised an opportunities framework for these LDC 'success stories'. They had all made use of several main types of opportunities available to LDCs, making their mark internationally by:

    • moving up the value chain;
    • finding niche markets and ways of product innovation;
    • embracing the services revolution;
    • turning comparative advantage into competitive opportunity;
    • overcoming technical and structural barriers, and
    • exploiting South-South market opportunities.


    Tips for creating an enabling environment

    Many of them, of course, put their efforts into more than one of these opportunities. But the struggles they faced in establishing themselves also indicated how LDC governments could improve conditions for business in their countries, and how strategy-makers could provide the support services that entrepreneurs need to turn their export opportunities into business. In short, the round table brought forward a number of ideas about how to create an 'enabling environment' for trade development in LDCs.

    Through its information services, capacity-building programmes, network support and poverty-reduction focus, ITC offers some of the tools to enable strategy-makers to increase competitiveness within their economies, whether encouraging South-South trade, introducing support for LDCs to deal with multilateral trading system issues, such as World Tr@de Net or JITAP (the Joint Integrated Assistance Programme for African Countries with WTO and UNCTAD), providing supply chain or export skills training and counselling, or running programmes to improve quality management.

    The successful LDC exporters invited to Brussels are truly a new generation of modern business leaders, exploiting opportunities through innovation, hard work, progressive management and an understanding of a fast-changing and increasingly demanding international business environment.

    ITC and the Government of Norway hope that the forthcoming book, Turning LDC Export Opportunities into Business: A Strategic Response, will broaden the dialogue among stakeholders on how to convert LDC export opportunities into business. The dialogue, initiated at the BSRT, will continue through regular updating of the BSRT web site.

    As new opportunities arise, exporters will innovate and adapt to new challenges, and new champions will emerge. To succeed broadly in the highly competitive and changing international markets, LDCs and their exporters will need access to state-of-the-art technologies, a national enabling environment underpinned by good trade policies and strategies, top-notch trade support services and physical infrastructure to facilitate production and marketing, as well as partners to help fulfil these needs.

    Against this backdrop, it would perhaps be useful in a few years to revisit the issues presented at the BSRT, to gauge the evolution of successful LDC exporters and the realization of opportunities identified, to assess progress in development of policies, strategies and other export-enabling factors, and to analyse new opportunities and identify the new paths that should be mapped out for discussion in the continuing dialogue among the stakeholders dedicated to LDCs' export success. Meanwhile, readers are invited to contribute their thoughts and share in the information available on the BSRT web site.

    Martin Dagata recently retired as Director, ITC Division of Technical Cooperation Coordination. He led the BSRT Initiative at the Third United Nations Conference on LDCs. Ashish Shah, ITC Senior Trade Promotion Officer (shah@intracen.org) undertook the day-to-day management and coordination of the event.




    LDCs: who they are

    LDCs (least developed countries) are officially designated as such on review by the United Nations Economic and Social Council. A number of criteria are used as the basis, including: low national income (per capita gross domestic product, i.e. GDP, under US$ 800 for countries now joining the list); low levels of human development (a combined health, nutrition and education index); and economic vulnerability (a composite index based on indicators of instability, inadequate diversification and the handicap of small size). In all, LDCs are home to 10.4% of the world's population.

    The average per capita GDP in the LDCs was US$ 287 in 1998, compared to US$ 27,402 in developed countries and US$ 1,260 for all developing countries. People in the LDCs can expect to live for only 51 years and only one in four births is attended by trained health personnel. One child in ten in the LDCs dies before his or her first birthday, and half the population is classified as illiterate.

    Source: DEV/2305 - 11 May 2001, United Nations, New York, UNCTAD's Least Developed Countries 2000 Report, and World Trade Organization.


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