Discuss the extent to which international trade is good for economic development for Sub-Saharan Africa.

Topics: Economics, International trade, Human Development Index Pages: 3 (1098 words) Published: February 24, 2014
Development is probably best described by Michael Todaro as when the following three conditions are met: an increase in the availability and distribution of basic life sustaining goods; an increase in the standard of living(both material and non-material) and an expansion of the economic and social choices available to people. Development can be measured by H.D.I (human development indicator) which measures development combining indicators of life expectancy, years spent in education and income. SSA heavily rely on trade to grow and develop as internally they don’t have the capital to produce goods that will be international competitive. Although SSA do have large amounts of commodities which they are now learning make use of as they are now expanding trade to major emerging markets. International trade for SSA is currently increasing as countries such as china are demanding a lot more commodities from Africa. Exports from SSA helps boost the economy as exports are a component of aggregate demand and following an increase in trade through exports aggregate demand will shift right and real GDP will increase showing an increase in growth. This helps development as following the growth more jobs will be created within SSA to extract the exports, this therefore will mean that people who were originally unemployed will now have a higher income and will therefore be able to access more basic life sustaining goods that they and their families possibly previously couldn’t access. Furthermore due to the fact that the economy of SSA is looking quite strong as they have had a high and stable level of growth even during the recession, there fiscal balance has been improving and they are so rich in raw goods that it will attract multi-national corporations to SSA. When these firms move to SSA they will have many positive effects on their economy as when these firms enter Africa with them they will bring aid and medicine to help the people of villages and towns who require the...
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