Export-driven economies. Or more specifically, a certain type of em. It’s an East Asian model of economic growth; to export. Now, a few days back, the banker Uday Kotak was explaining his reasons for why he thought China had conquered the local market and in that speech, there was one thing he said which stuck with me. That exports are the best way to measure competitiveness.
No. C’mon. I heartily disagree. To me, the ability to innovate is what helps any economy stay competitive and an open market is imperative for this innovation to take place. Granted, it is not absolutely necessary but all available evidence points to this trend; that innovation is born of competitions aka ‘an open market’.
We can ask, request, demand, and threaten an individual, firm, society, city, or nation to innovate but it’s only and only, competition, that will bring about innovation. . .As it happens, a certain amount of survival instinct is necessary to foster one to move and create things.
I would like to move on to exports, now.
Exports go in sync with manufacturing. But the knowledge economy we have today is built on services. So I don’t understand why this fetish for exports still prevails. It’s obvious to anyone that technologies like blockchain, artificial intelligence, big data analytics, SaaS, virtual reality, and robotics can’t really be exported. And this is the future, after all.
The future, therefore, is not one that can be exported. So let’s quit the race for getting trade surpluses because it just doesn’t matter. We can export software or we can invite investment for all that we’ve built which will never technically count as ‘export’.
And so the lesson for us is that we must stop trying to twist and force consumers or producers to act how we want and instead just let things be.