Title: We must help developing countries escape commodity dependence | World Economic Forum
Headings: We must help developing countries escape commodity dependence
We must help developing countries escape commodity dependence
The broader ramifications
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Content: In addition, a heavy concentration on a few commodities can have profound social consequences. Take the case of mining, a capital-intensive sector. As countries open up to trade, the benefits in large part accrue to the owners of capital, and not to the workers, who may work under very tough conditions. Take the case of agricultural commodities, a more labour-intensive sector in poor countries. They are part of the low value-added segments of international food supply chains, and thus farmers get very low returns. This is why a coffee producer who works from sunrise to sunset gets less than 3 % of the price you pay for your morning coffee. Taken altogether, this perpetuates inequality and reinforces the perception that something is fundamentally wrong with the international trading system. Have you read? Why have commodities crashed? China is still king of commodity consumption
Commodity-dependence is stubborn, but it is not a sentence for underdevelopment.