November 05, 2009 at 06:42 AM
Global, free trading, liberalised financial markets are as much a part of the global trade system as drinking coffee from Costa Rica or arranging a bouquet of flowers from Kenya. And those markets, whose purpose and even existence was questioned over the last 12 months, have delivered mightily for rich and poor countries in the last 30 years. World real GDP grew by around 145% from 1980 to 2007. Even if this recession sees a GDP fall of 10%, then the net growth in global GDP from 1980 to 2010 would still be about 120% or about 2.7% per year. Look at the growth over the same period in non-capitalist practising countries and see the difference.
Admittedly global trade has an externality yet to be priced properly. I refer to the environmental cost of trading, which currently is not costed or imposed on more than just a few industries. But, with an expectation that we will develop ever more sustainable means of freight transport, then it must be reiterated time after time that free trade and markets has led billions of people and a good majority of the people living on the planet to a higher quality of life; higher life expectancy, cleaner water, better healthcare, higher standards of literacy and greater freedom. There is a lot of work still to do, but where will the resources to invest in developing nations come from if not from private enterprise?
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