Peace, democracy and freedom, keys to progress: Krugman - Sectors

The US Nobel Prize winner in economics Paul Krugman and President Gustavo Petro participated in the New Models of Economic Development forum, organized by the Javeriana University. It was a space that Krugman took the opportunity to share his perspective on the opportunities that emerging economies have like the Colombian to develop.

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To start his presentation, the Nobel Prize winner took South Korea and Mexico as examples. Both countries implement the strategy of developing their manufacturing industries to replace imported products and, later, make their way to foreign trade.

This was considered for a long time as the ideal formula to achieve the development of a nation, however, the results of both economies were different. In South Korea, the measure of scarcity and its economy has maintained a growth trend since the middle of the 20th century. On the contrary, Mexico, despite being linked to a large North American manufacturing system, having access to the United States and becoming an exporting country, does not update the same development.

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Paul Krugman with President Gustavo Petro, Financial Superintendent Cesar Ferrari and Agriculture Minister Jhenifer Mojica.

This behavior, according to Krugman, allowed us to discover that “there are countries that have achieved rapid growth integrated into the world economy, there are no countries that have achieved development without having integrated and, unfortunately, there are countries that have integrated without achieving the rapid development that we would have liked to see”.

In other words, the strategy that was known was not accurate to describe the variations presented by all the countries, however, the possibility of development exists and as it is replicated in very few examples, it is not so easy to achieve.

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Bearing this in mind, Krugman points out that Colombia has the advantage of having natural resources, ones that countries like Malaysia, which started out poor and are now major exporters, do not have. In this sense, one might think that the country has the possibility of being a success story in terms of development, but he reiterates that it is not that easy.

Development requires conditions such as integration into the world economy, education and the rule of law, but even with all this, the nobel points out that progress cannot be guaranteed and it is not known exactly how development works. Also, the world in which the examples you used were given had some rules that no longer apply.

There is still room for countries to develop as long as they are seen as good and reasonable in global trade.

The opportunity for development

This is not to say that there are no opportunities to achieve it today. According to Krugman, there is still room for countries to develop as long as they are seen as good and reasonable in global trade.

An example of this is the case of India, despite the fact that the era of globalization and development are not presenting the results that they have been a few years ago, this Asian country is showing excellent results in its economic development, like Bangladesh. Krugman points out that both are still poor countries, yet they are richer than they were before.

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For all of the above, the economist ends his intervention by stating that, in some cases, success stories in terms of development are possible and countries that understand the values of peace, democracy and freedom, it will be easier to achieve it.

JUAN DAVID CANO LOPERA
School of Multimedia Journalism EL TIEMPO
ECONOMY WRITING