text: bylowgrowthofconsumption, particularly whereimportpenetration ratiosare already high,suchastextiles, clothing, andfootwear. 9.Markets arealsolikelytobecome morecompetitive asthecentrally planned economies startcompeting inworldmarkets onalargescaleandasdeveloping countries participate moreininternational trade. 10.Developing countries havesoughttoformregional trading arrangements in ordertomitigate thecostsofimportsubstitution regimes basedonsmallnational markets. Theyhavesoughttobenefit fromeconomies ofscale, economies of specialization, andgreater competition, whichregional markets mightprovide. Growthofintra-regional tradewasrapidinLatinAmerica inthe1960sand1970s buthasbeenslowinalldeveloping regions exceptEastAsiainthe1980s. Muchof theintra-regional tradeofdeveloping countries isbasedoncomparative advantage arising fromdifferences inresource endowments incontrast totheintra-regional tradeofdeveloped market economies whereintra-industry tradebasedon specialization andeconomies ofscaledominates. 11.Byandlarge,efforts bydeveloping countries toindustrialize inregional blocshavebeenunsuccessful. Someoftheblocsweresimplytoosmalltoexploit economies ofscale. Countries atdifferent levelsofdevelopment orwithdifferent political philosophies couldnotagreeontheco-operation necessary forregional blocmanagement. Rulesoforigin andotheradministrative problems haveplagued theblocssothat,todate,manyofthemhavenotbecomeeffective. 12.Private directforeign investment iscomplementary totradeevenwhen undertaken underregimes ofimportsubstitution. However, foreign investment in protected industries raisescontrol issuesanditscostsandbenefits aredifficult toevaluate. 2.Conclusions forpolicy 13.Themaintenance ofanopenglobaltrading framework isoftheutmost importance toallnations, butparticularly todeveloping countries, especially to thesmaller andlessdeveloped th .. among em,andtocentrally planned econom~es seek~~g toentertheworldmarket system. Allcountries haveaninterest in ensur~ng that region~l tra~ea:rangements arepartoftheglobaltrendtowards openness and~rad7 ~~beral~zat~on, sinceglobalwelfare willbeincreased more through non-d~scr~m~natory thand'.. .~scrlmlnatory reduct~ons inprotectionism. 14~,~he?rowthofnon-tariff barriers totrade,unilateral decisions on an~-~plng, andthegrowthofbilateral tradenegotiations bysomedeveloped ~~~~~~~~~a~~:eaten.the continuation ofanopen,multilateral trading system. naga~nst tradefromthedeveloping countries, asrepresented bythe -2-multifibre agreement andtheCommonAgricultural PolicyoftheEuropean Community, iscounter tothespiritofmultilateralism andshould beeliminated. 15.Furthermultilateralization isessential and,because ofthechanges intheir relative economic weights intheworldeconomy, manymoredeveloped market, developing andformerly centrally planned economies havemajorresponsibilities in thisregardthaninthepast. Allcountries shouldintensify theirefforts to achieve asuccessful conclusion totheUruguay Round. 16.Proposals forstrengthening regional trading arrangements amongdeveloping countries arebasedontheviewthatinexperienced producers canlearntocompete, becomemoreefficient through learning-by-doing, andbenefit fromeconomies of scaleandthesharing ofexperience within atrading blocasastepping stoneto multilateralism. Sincetheseexpectations havenotoftenmaterialized inthepast, acarefulanalysis ofactual andpotential costsandbenefits tothosewithin a blocandthosenotincluded should beundertaken bycountries considering joining sucharrangements. 17.Regarding private direct foreign investment, thesocialcostsandbenefits thataccruetothehostcountries depend onitspolicies. Ifthehostcountry environment isopenandoriented towards worldmarketprices, thehenefits of privatedirectforeign investment arelikelytoexceedthecostsbyasubstantial margin;inaprotected environment thecostsmaywellexceedthebenefits. C.InternatiQnal cQ-operation fQrthealleviation Qfpoverty 1.Analytical findings 18.Persistent pQverty isaproduct ofinappropriate structures andpoor policies. Amajorcharacteristic ofthepooristheirlackofproductive physical assetsandhumancapital. 19.Duringthe1980s,thenumbers oftheabsolute poorincreased inthedeveloping Countries asawhole. InAfrica, theabsolute poorhavealsoincreased asa
analysis: The text appears to be discussing the relationship between international trade, economic development, and poverty alleviation. It highlights the importance of open markets, regional trading arrangements, and private direct foreign investment in promoting economic growth and development, particularly in developing countries. The text also touches on the challenges faced by developing countries, such as the need to overcome protectionism and the importance of careful analysis of the costs and benefits of trade agreements.