Why is it so important for developing nations to be involved in trade, and what institutions and policies exist to help developing nations?

It is no secret that developing nations rely heavily on advanced nations when referring to international trade. The exports of developing nations are primarily imported by advanced nations. The developing nations that become more open to international trade and foreign investment have a higher potential for economic growth and a better life for their citizens.

There are many organizations designed to help the development of these budding nations such as the International Monetary Fund (IMF), The World Bank, and the Organization for Economic Cooperation and Development (OECD). 

The OECD is on a mission to promote policies that will improve the economic and social well-being of people around the world. They provide an opportunity for governments to work together to share experiences and seek solutions to common problems. In essence, countries can learn from each other’s successes and failures. How great is that! Just on a human to human level this has always worked well for me, imagine how much countries can benefit from this type of forum and information sharing!

The OECD sets “international standards on a wide range of things, from agriculture and tax to the safety of chemicals”. Drawing on facts and real life experience, they are known as a statistical agency, the OECD is able to recommend policies to help make an improvement in people’s lives. “OECD uses its wealth of information on a broad range of topics to help governments’ foster prosperity and fight poverty through economic growth and financial stability. We help ensure the environmental implications of economic and social development are taken into account”.

The organization was established in 1961 and is headquartered in Paris, France.  It has 34 member countries, made up by many of the world’s most advanced countries with high-income economies.  As pointed out on the organization webpage, the OECD is currently focusing on 4 main areas:

·         Governments need to restore confidence in markets and the institutions and companies that make them function.  It must be recognized that this will require improved regulation and more effective governance at all levels of political and business life.

·         Governments must re-establish healthy public finances as a basis for future sustainable economic growth.

·         Looking for ways to foster and support new sources of growth through innovation, environmentally friendly ‘green growth’ strategies and the development of emerging economies.

·         To underpin innovation and growth, we need to ensure that people of all ages can develop the skills to work productively and satisfyingly in the job of tomorrow.

The OECD is just one example of an organization that helps improve developing nations. Although most members are developed countries, the OECD can provide budding nations vast knowledge to help promote improvements, and knowledge is power!