Economic Diversification in Resource Rich Countries

Developing countries as a whole have been remarkably successful in diversifying their economies and their export structures. This process of diversification has taken many forms. The most prominent change has been the shift towards industry. In the 1960’s, some 80% of developing country exports were primary commodities; today, almost 80% are industrial products. This massive transformation in export structure has been associated with the rise of major industrial power-houses; China most prominently, but also countries such as Korea, India, Brazil, Malaysia, Vietnam, Indonesia and Mexico. Most of these new industrial powers were previously primary-based economies. Today they are deeply integrated into global production networks across a wide range of sectors, participating in rapidly-growing South-South trade, and in most cases rapidly upgrading the sophistication of their export mix.