OECD urges more open trade as way to boost economic growth
COUNTRIES that are struggling to boost growth should consider opening up their economies more to global trade, according to the OECD.
Measures to seal off national industries, while politically popular, “only sustain or exacerbate the sub-optimal status quo”, claims the paper on international trade.
Since 1970, manufacturing workers in open economies enjoyed pay rates that were between three and nine times greater than economies classified as “closed”.
The study also suggested that allowing companies to use offshore trading bases can actually help raise employment and wages.
“Offshoring and outsourcing by developed countries – two commonly-cited negative aspects of globalisation – often complement, rather than replace domestic jobs, while creating new, higher-wage opportunities in developing countries,” the report added.