Saturday, August 30, 2008

Chris Blattman on Travelling and Development

An excellent short interview with Chris Blattman on travelling on economic development as well as a more general point on development. I really liked the following bit on what it will take to lift more African countries out of poverty:
The difference between a poor country (say, $2000 per head) and a middle income one (say, $12000 per head) is simple: one has a manufacturing sector and one does not. Something like forty percent of Kenya's GDP comes from the 5 percent of the workforce: those in light and medium industry. That sector is crucial. Most African nations won't have a self-sustaining education and health system until they build some sort of industrial tax base. What's needed to get there? Reliable roads and electricity are a start. Reducing the red tape faced by business can help too. But realistically, I believe real wages in Asia will probably have to rise before it becomes profitable to produce in Africa. The faster China and India get rich, the sooner we'll see a transformation in Africa. In the meantime, preferential trade and tax treatment by the US and Europe for African goods could help foster industry and technology transfer.

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