IV.

POLICY LESSONS FOR THE LEAST

DEVELOPED COUNTRIES DRAWN
FROM MALAYSIA’S EXPORT
DIVERSIFICATION EXPERIENCE
As indicated in chapter II, Bangladesh, Myanmar and Nepal have
implemented a number of policies to enhance their exports. Owing to these
initiatives, the export of certain commodities in these selected least developed
countries has increased significantly in recent years. However, the empirical
results in chapter III found that the exports of these LDCs are very much
concentrated, implying that only very few commodities still account for a
significant share of total exports. In analysing the experiences of the LDCs, it
was generally noted that the ensuing policies to promote export diversification
at times may be hindered by a number of factors. For example, policies to
promote exports may be in conflict with other national policies; institutional
capacity within a country to implement the necessary export diversification
policies may be weak; market mechanisms and the enabling environment
required to promote international commerce may not be fully in place;
further, the limitations in infrastructure may render the physical transport of
goods difficult.
The empirical results in chapter III also found that a developing
country such as Malaysia could achieve high economic growth in the 1980s by
broadly diversifying its exports in both traditional commodities (horizontal
diversification) and non-traditional commodities (vertical diversification).
Therefore, the present chapter draws lessons from the successful experience of
Malaysia in diversifying exports and achieving rapid economic development
and it provides some policy recommendations that may help LDCs to enhance
and diversify their exports.

A. The Malaysian economy

The Malaysian Government has actively promoted economic development
and industrialization through significant State sector investment in the
economy, close alliance between the Government and the private business
community, the trend towards privatization of State enterprises and the formu-
lation and implementation of policies and programmes to bolster the economic
status of the Malay and indigenous communities.22
22 The Economist Intellegience Unit, Country Profile: Malaysia, 1999, <http://db.eiu.

com/composite.asp?topicid=MM>.

63
 Further, Malaysia has taken advantage of the trend among companies in
developed countries to relocate their production lines to lower-cost areas, using
moderately advanced technology. Malaysia’s well-developed infrastructure
and administration and its well-educated workforce has attracted foreign
direct investment (FDI), which reduced the country’s need to borrow overseas
or to generate domestic funds in order to finance investment. This develop-
ment strategy, however, carries penalties. Although Malaysia’s net foreign
indebtedness is low, repatriation of FDI profits is a large debit item on the
invisibles account. However, the need to finance these transfers has not
imposed serious financial strains on the economy, since the prospects for
further investment have ensured a high proportion of reinvested profits.
Nonetheless the economy has been vulnerable to changes in the relative at-
tractiveness of different countries as locations for investment.
In Malaysia, the Ministry of International Trade and Industry is
responsible for the formulation and implementation of trade regulations and
policies, while the Customs Department provides information on licensing
and tariffs. Bank Negara is in charge of setting and supervising all foreign-
exchange controls.

B. Export incentives schemes

A number of incentive schemes are available in Malaysia.23 These schemes
provide tax concessions and exemptions on inputs, the manufacturing process,
or the sale of goods produced primarily for export.

1. Tax exemptions
(a) A double tax deduction is allowed for expenses incurred by resident
companies exporting manufactured and agricultural products. Some of the
deductible items are expenditures for overseas advertising, the supply of free
samples abroad, market research, the preparation of tenders for the supply of
goods overseas, the supply of technical information abroad, public relations
work connected with exports, exhibits and participation in trade or industrial
exhibitions, the cost of overseas travel and accommodation, and the maintenance
of an overseas sales office. Companies with pioneer status may accumulate
deductions to be used against their post-pioneer income.
(b) A double tax deduction is permitted for export-credit insurance
premiums for non-traditional markets taken out with an insurance firm
approved by the Ministry of Finance.

23 Idem.
64
64

64 646464
 (c) Firms manufacturing finished products for export are eligible for
full exemption from customs duty on imported raw materials, provided that
the materials are not available locally at an acceptable quality and price.
(d) Manufacturers of export items may claim drawback of excise
duty for parts, ingredients and packaging materials, and for sales tax on any
goods used to produce the items. Delivery of goods to a free zone or to the
islands of Langkawi or Labuan (see Box IV.1.) is considered exportation for
the purpose of qualifying for drawback.

Box. IV.1. Labuan International Offshore

Financial Centre
Labuan International Offshore Financial Centre (IOFC) was established in 1990 as
Malaysia sought to become a regional capital market centre. The Centre is under the
regulation of the Labuan Offshore Financial Services Authority, which administers and
enforces the Offshore Companies Act, the Labuan Trust Companies Act, the Offshore
Banking Act, the Offshore Insurance Act and any other law pertaining to offshore
financial activities. Previously, financial institutions had to obtain approvals and
licences from up to six different authorities.

In February 1998, there were 64 IOFC-licensed banks, 6 of which were Malaysian, as

well as 20 trust companies, 21 insurers and 1 reinsurer in Labuan. IOFC offers
attractive incentives. Net profits from offshore trading activities conducted from Labuan
are taxed, upon election at a concessionary rate of 3 per cent or a fixed sum of
M$ 20,000. Income from offshore non-trading activities is exempt from tax, and
expatriates employed in a managerial capacity by offshore companies are granted
an exemption of 50 per cent of employment income for the 1993-1998 assessment.

In 1997, the following incentives were introduced: (a) income derived from qualifying
professional services such as financial, accounting, secretarial and legal services
provided to offshore companies became exempt from tax on up to 65 per cent of
statutory income; (b) the current income tax exemption of 50 per cent on gross income
of foreign workers in a managerial capacity serving in offshore companies was extended
from assessment year 1998 to assessment year 2000 (the exemption took effect from
assessment year 1997); and (c) the period of stay in Labuan for individuals to be eligible
for qualified duty-free goods was reduced from 72 hours to 24 hours.

Source: The Economist Intelligence Unit, Country Profile: Malaysia, 1999, <http:/db.
eiu.com/composite.asp?topicid=MM>.

65
 Box IV.2. Trade restrictions
Although this chapter discusses policies to diversify and promote exports, Malaysia
maintains a number of trade restrictions for exports as well as imports. Quantitative
import restrictions are seldom imposed except on a limited range of products for the
protection of local industries or for reasons of security. Malaysia, which operates
a system of import licensing, has added heavy construction equipment and certain
electrical household goods to the number of goods requiring permits. Import duties
range from nil to 300 per cent, with the trade-weighted average tariff being 8.1 per cent
in 1997. However, raw materials used directly in the manufacture of goods for export
are exempted from import duties if such materials are not produced locally or if the
local materials are not of acceptable quality and price. This provision, for example,
applies to the very large Malaysian imports of semiconductor components for the
fabrication of completed semiconductors for export. Exemption from duties is also
available for machinery and equipment used directly in the manufacturing process or
such items not available locally. In addition to import duties, a sales tax of 10 per cent
is levied on most imported goods. As with import duties, however, the sales tax is
not applied to raw materials and machinery used in the production of exports.
Malaysia also has a system of export licensing to ensure compliance with bilateral export
restraint agreements. Export licences are necessary for 38 product groups, including
animals and animal products, fish, dairy products, rubber, palm-oil products, pineapples,
vegetables, rice, cocoa, minerals and ores, cement clinker, Portland cement, metal
waste, some chemicals, cinematographic films, roofing tiles, timber, plywood, veneer
chips, waste paper, textiles, military clothing and equipment, bricks, tin ingot, sugar,
iron and steel, and star fruit. Another 12 products may be exported only after meeting
specific criteria for the protection of wildlife, health and antiquities. The export of
coral (except for coral that has been processed and is being used as jewellery) and
turtle eggs is prohibited, as is the export of logs or rattan from peninsular Malaysia.
Export taxes are imposed to raise revenue, protect the environment and maintain an
adequate supply of certain goods in the domestic market. Export duties on principal
commodities, including petroleum, timber, rubber, pepper, palm oil and tin, are
calculated on the basis of a threshold price, and no duty is charged if the price falls
below the given threshold. Export duties on petroleum products and oil obtained from
bituminous minerals and crude were cut to 20 per cent from 25 per cent in the 1997
budget. The Government imposed taxes on selected species of sawn timber to ensure
an adequate supply of timber for timber-based industries. The export levies for
timber-based products were revised and removed entirely for some species to encourage
and spur exports in the light of the economic downturn in 1997. Malaysia introduced
a “cess” in 1990 to assist in the management of logged-over forests. Funds raised
from the Forest Development Cess were used to implement a programme designed
to achieve the International Tropical Timber Organization guidelines that all timber
must come from sustainably managed forests by the year 2000.
Source: The Economist Intelligence Unit, Country Profile: Malaysia, 1999, <http://db.
eiu.com/composite.asp?topicid=MM>; United States Department of State, Country
Commercial Guides Fiscal Year 1998: Malaysia, <http://www.state.gov/www/about-
state/business/com-guides/1999/eastasia/malaysia99.html>.

66
66

66 666666
 2. Free zones
Currently, there are 14 free zones, primarily along the west coast of
peninsular Malaysia, in which export-oriented manufacturing and warehousing
facilities may be established. Companies which export at least 80 per cent of
their output and depend on imported goods, raw materials and components
may be located in these free zones. Raw materials, components, machinery
and equipment used directly for export production in a zone are eligible for
exemption from import and excise duties and from sales and service taxes. If
goods from a zone are sent out of the zone for domestic consumption, they are
subject to normal customs duties as though imported from a foreign source.
However, firms may apply to the Ministry of Finance to such sales exempted
have from import duties. Goods exported from Malaysia to a free zone are
eligible for duty drawbacks. Firms seeking to set up operations in a zone are
required to apply to the appropriate state’s economic development corporation.
In addition to the free zones, Malaysia permits the establishment of licensed
manufacturing warehouses, which give companies greater freedom of location
while enabling them to enjoy privileges similar to those operating in a free zone.

3. International procurement centres

The 1997 budget also sought the establishment of international procurement
centres (IPCs), which offer centralized procurement of manufacturing services
and the purchase of raw materials, components and finished products. The
incentives allow IPCs to (a) open one or more foreign-currency accounts with
any licensed commercial bank to retain export proceeds without any limit;
(b) enter into foreign-exchange contracts with any licensed commercial bank
to sell forward export proceeds based on projected sales; (c) be exempt from
the requirements of the Ministry of Domestic Trade and Consumer Affairs
Guidelines on foreign-equity ownership and retail trade; and (d) bring raw
materials, components or finished products without payment of custom duties
into free zones or licensed manufacturing warehouses for repackaging, cargo
consolidation and integration before distribution to the final consumers. The
Ministry of Trade and Industry processes and approves all applications for
IPC status, for which the following criteria apply: (a) local incorporation under
the Companies Act 1965, with minimum paid-up capital of M$ 500,000;
(b) minimum total business spending of M$ 1.5 million per year; (c) minimum
annual business turnover of M$ 100 million; and (d) goods handled through
Malaysian ports and airports.

67
 4. Free port
In an effort to divert shipping to Malaysian ports, Port Klang has been
designated a “free port.” The free port status is aimed at promoting the
trans-shipment trade, and diverting and redistributing shipping traffic from
neighbouring ports to Port Klang. Other Malaysian ports, that is those on the
east coast, are also to be given so-called free port status.

C. Export insurance and credit

In Malaysia, official schemes are available for the refinancing, insuring
and guaranteeing of export credits.24 Malaysia Export Credit Insurance Berhad
(MECIB), with an underwriting capacity of up to M$ 125 million, provides
commercial banks with coverage of losses against loans to exporters and
suppliers. Facilities offered by MECIB include a comprehensive short-term
policy, a confirming-bank policy, a banker’s export-finance-insurance policy, a
bond-indemnity-support facility and a buyer-credit-guarantee facility. MECIB
covers 90 per cent of commercial risks and 95 per cent of political risks for
exporters at premiums of 0.01-3.5 per cent, depending on the company’s
stability, the goods’ destination and the terms of payment. MECIB issues
comprehensive short-term policies for up to 180 days and only on a repetitive
basis. In 1998 policies with maturities of 90 days accounted for nearly 75 per
cent of all policies outstanding. All locally incorporated firms that export
goods wholly or partly produced or manufactured in Malaysia are entitled to
MECIB insurance facilities. Although local content of 65 per cent is normally
required, this criterion may be waived. All locally incorporated banks
may apply for cover under the MECIB export-finance-insurance policy and
bond-indemnity-support facility.

An export-credit-refinancing facility, once maintained by Bank Negara

Malaysia and transferred to the Exim Bank effective January 1998, enables
exporters to obtain short-term financing for up to six months for the
post-shipment facility and four months for the pre-shipment facility. Input
suppliers have access to this facility through the issuance of domestic letters of
credit or domestic purchase orders issued by the exporter in favour of its
suppliers. The rate for the Export Credit Refinancing Scheme was lowered to
7 per cent from 8.3 per cent in December 1998 to reflect the lower interest
rate trend in the local money market, particularly on banker’s acceptances.
Refinancing facilities are granted for up to 100 per cent of export value
(post-shipment) and 80 per cent of export order value or the eligible amount

24 The Economist Intelligence Unit, Country Profile: Malaysia, 1999, <http://db.eiu.com/

composite.asp?topicid=MM>.
68
68

68 686868
determined by Bank Negara Malaysia (pre-shipment facility). The minimum
amount of financing is M$ 10,000 for both facilities. The maximum limits for
pre-shipment and for post-shipment refinancing are M$ 30 million per exporter.
The financing is granted through commercial banks. Eligible goods must have
local content of at least 30 per cent of the raw materials used and a minimum
of 20 per cent by value; certain goods – crude rubber, vegetable oil products,
cocoa products, food products and textiles, for example – are exempt from the
local-content requirement.
Malaysia’s Exim Bank was incorporated on 29 August 1995 with initial
paid-up capital of M$ 150 million, which was raised to M$ 300 million at the
end of 1998. Exim Bank approved loans and guarantees of M$ 2,160 million
between its inception and the end of August 1998, when 40 per cent of the total
had been disbursed. Buyer credits amounting to M$ 1,030 million formed the
bulk of the approved funds, followed by overseas-investment credits (M$ 390
million), supplier credits (M$ 387 million) and guarantees (M$ 298 million).

D. Trade-related payment and

exchange controls
Until 1998, Malaysia maintained a fairly liberal system of exchange
controls, which applied to transactions with most trading partners. Measures
introduced on 2 September 1998 applied to short-term portfolio investments,
and are aimed at containing currency speculation and minimizing the impact of
short-term capital inflows on the domestic economy. These measures do not
affect operations of long-term investors in manufacturing and related support
and service sectors. Repatriation of capital, profits, dividends, interest, rental
and commissions is freely permitted; foreign investors in manufacturing are
still given the flexibility to maintain foreign-currency accounts to conduct
their normal operations. Commercial banks are authorized to approve
remittances in any amount. Individual payments abroad of less than M$ 100,000
(or its equivalent in foreign currency) may be made by any entity without
Bank Negara approval or government paperwork.

In Malaysia, export proceeds may be received in most foreign currencies

or in Malaysian currency (ringgits) from an external account. Payment must be
received within six months of the date of export. Exporters and residents may
open foreign-currency accounts with Tier-1 banks in Malaysia and at overseas
branches of Malaysian-owned banks, primarily to retain export proceeds in
foreign currencies (to reduce foreign-exchange risks and avoid conversion costs).
This measure also encourages residents to repatriate foreign-exchange earnings
to offset the services account deficit in the balance of payments. The limit on
exporters’ overnight balances ranges from a US$ 1 million to US$ 5 million

69
equivalent in foreign currency, depending on the amount of the export receipts.
(These funds may be used for currency options and other derivatives to hedge
trade-related currency risk.) Individuals who are not net borrowers in their
domestic accounts may hold unlimited amounts in foreign-exchange accounts
overnight, but companies are limited to overnight balances of US$ 500,000
exclusive of the special concession in relation to the export earnings mentioned
above. Import payments to a non-resident are freely permitted subject only to
the completion of a statistical form for remittances of over M$ 100,000. Banks
are authorized to approve such payments regardless of the amount. The banks
must refer to the controller for approval only on payments made for investing
in securities of immovable property abroad and for extending credit to, or
placing deposits with, non-residents, whenever such transactions are financed
by a credit facility in Malaysia.
With the introduction of measures in 1998, the ringgit has been pegged at
M$ 3.80 to US$ 1. Bank Negara also imposed a US$ 2-million limit on ringgit
sales at the height of the 1997 currency turmoil to reduce the effectiveness
of speculators. These limits were still in effect in May 1999. The supply
of foreign exchange, however, is not subject to any limitation. As long as
commercial banks comply with the risk-weighted ratio set by Bank Negara,
they may trade in foreign exchange. In addition, more than 300 money changers
are licensed under the Exchange Control Act of 1953 to buy and sell foreign
currency. Finance companies are not allowed to trade in foreign exchange;
merchant banks may do so only if they have attained Tier-1 status, indicating
Malaysia’s strongest banks, which are allowed to offer a wider array of services.

The regulations on domestic borrowing by foreign firms, as set out in

the exchange-control liberalization measures of December 1994 and the steps
to liberalize capital markets of June 1995, allow non-resident-controlled
companies to borrow M$ 10 million (not including short-term trade financing)
from domestic sources without prior central bank approval. Non-resident-
controlled companies may access any amount of short-term (fewer than
12 months) trade finance facilities, including trust receipts, banker’s accep-
tances, export-credit programmes, guarantees and foreign-exchange lines;
however, they must source 60 per cent of their loans (including trade credits)
from financial institutions that are incorporated in Malaysia and controlled
by Malaysians.

E. Trade agreements
As a member of the Asia-Pacific Economic Cooperation group and ASEAN,
Malaysia is committed to reduce trade restrictions and increase economic
openness. Malaysia is a member of the ASEAN Free Trade Area, which is
70
70

70 707070
aimed at reducing trade barriers between the member countries over a 15-year
period. Malaysia has also agreed to tariff reductions under the terms of the
Uruguay Round of the General Agreement on Tariffs and Trade, the Multifibre
Arrangement and the Information Technology Agreement. To encourage trade
with non-traditional markets such as South America, China and Viet Nam,
the central bank has designed a model bilateral agreement that guarantees
payment. To date, Malaysia has signed bilateral payment arrangements with
26 countries and bilateral trade agreements with about 54 countries based on
the most-favoured-nation principles of the World Trade Organization.

Malaysia has signed investment-guarantee agreements with members

of ASEAN and its major trading partners. The agreements protect against
expropriation, provide for prompt and adequate compensation in cases of
nationalization and ensure the freedom to transfer profits, capital and other
payments. Malaysia has also ratified the provisions of the Convention on
the Settlement of Investment Disputes between States and Nationals of other
States established by the World Bank for investment disputes that cannot be
settled through local administrative and judicial facilities.

F. Infrastructure
In order to transform its economy from labour-intensive assembly
operations to knowledge-based, capital-intensive information industries, Malaysia
has invested heavily in the development of its infrastructure. While the transport
and communications infrastructure is well developed, the slowdown in economic
growth and depreciation of the ringgit as a result of the 1997 regional financial
crisis may eventually affect key infrastructure projects. Furthermore,
bottlenecks persist in the supply of labour; shortfalls in training and technology
are apparent; and bureaucratic obstacles sometimes make it difficult for
expatriate employees to obtain work visas. Existing constraints to the entry
and expansion of foreign financial institutions limit the offering of the most
efficient financial services that along with telecommunications are likely to
form the foundation of a knowledge-based, capital-intensive economy.

G. Concluding remarks
During the past few years, Malaysia has been diversifying its industry
and agriculture. Through horizontal and vertical diversification, Malaysia is
trying to build a diverse export base, which includes a variety of products.
The policies initiated in the Eight Malaysian Plan illustrate how the Malaysian
Government has stimulated and promoted a diverse and resilient export base.
By adopting those policies in industry, Malaysia has not only built a more
value-added electrical and electronic sector that provides the bulk of its exports,

71
but it also has developed other resource-based industries that can reduce the
risk of over-reliance on a certain sector. At the same time, by encouraging
research and development (R and D) and providing other incentives, the
Malaysian Government has built within the same sector of industry diverse
production with different levels of processing. The same can be said of its
agricultural development. These approaches and initiatives are definitely
worth paying attention to if a certain LDC wants to learn some lessons from
the Malaysian experience in diversifying its exports. The following are some
policy suggestions for the three LDCs:
1. The Government should play a leading role in directing investment
into various sectors of industry. In so doing, the Government can
ensure that investment goes for more than just one specific sector
so that a diverse industrial base can be built.
2. The banking system can also help to diversify industry by its loan
patterns.
3. The Government should put efforts into R and D activities to upgrade
the level of industry. Fiscal and financial incentives should
be provided to stimulate R and D and technological innovation
activities.
4. The Government should provide an environment conducive to
attracting new investment in the country.
5. In terms of horizontal diversification of agricultural production, the
Government may consider in situ land development strategies
to better use land resources and to organize diversified plantations.
6. Agricultural services, such as R and D, training services and the
provision of credit facilities and basic infrastructure, should also
be provided. In this case, agricultural production can achieve
horizontal diversification by building up the processing ladder.
7. Banks and other financial authorities should also offer services to
diversify and strengthen the agricultural sector.

72
72

72 727272
 References

Ali., R., J. Alwang and P.B. Siegel (1991). Is Export Diversification the Best Way to
Achieve Export Growth and Stability? A Look at Three African Countries, The
World Bank Working Papers, No. 729 (Washington, World Bank).

Asian Development Bank, Key Indicators of Developing Asian and Pacific Countries
(Manila, Oxford University Press (China) Ltd.), various issues.

Bangladesh Bank, Annual Report 1997-1998 (Dhaka, Modina Printers and Packagers).

Bond, M. and E. Milne (1987). “Export diversification in developing recent trends and
policy impact”, in Staff Studies for the World Economic Outlook (Washington,
International Monetary Fund).

Central Bureau of Statistics, Government of Nepal, Statistical Year Book of Nepal

(Kathmandu, National Planning Commission Secretariat), various issues.

Centre for Policy Dialogue, Government of Bangladesh (1995). Experiences

with Economic Reform: A Review of Bangladesh’s Development 1995 (Dhaka,
University Press Ltd.).

(1997). Growth or Stagnation? A Review of Bangladesh’s Development

1996 (Dhaka, University Press Ltd.).

(1998). Crisis in Governance: A Review of Bangladesh’s Development 1997

(Dhaka, University Press Ltd.).

Dhananjayan, R.S. and N.S. Devi (1997). “Exports and economic growth: A study of
select nations in Asia and Europe during 1980-81 to 1993-94”, Indian Journal of
Applied Economics, vol. 6, pp. 41-63.

Dickey, D. and W. Fuller (1979). “Distribution of the estimators for autoregressive

time series with a unit root”, Journal of American Statistical Association, vol. 74,
pp. 427-481.

(1981). “Likelihood ratio statistics for autoregressive time series with a unit
root”, Econometrica, vol. 49, pp. 1057-1072.

Dollar, D. (1986). “Technological innovation, capital mobility and the product cycle in
North-South trade”, American Economic Review, vol. 76, pp. 177-190.

Edwards, Sebastian (1993). “Openness, trade liberalization, and growth in developing

countries,” Journal of Economic Literature, vol. xxxi, No. 3, pp. 1358-1393.

Engle, R.F. and C.W.J. Granger (1987). “Cointegration and error correction: represen-
tation, estimation and testing”, Econometrica, vol. 55, pp. 251-276.

Federation of Nepalese Chambers of Commerce and Industry, 1999. “Socio-Economic

Summit-Nepal 1999”, Background Paper (Kathmandu).

73
Food and Agricultural Organization, Yearbook of Fishery Products (Rome, United
Nations), various issues.

FAO Yearbook Fishery Statistics: Commodities (Rome, FAO), various issues.

FAO Yearbook of Forest Products (Rome, FAO), various issues.

FAO Yearbook of Trade and Commerce (Rome, FAO), various issues.

Giles, J.A. and C.L. Williams (2000a). “Export-led growth: A survey of the empirical
literature and some noncausality results: Part I”, Econometric Working Paper
EWP0001, (Victoria, British Colombia, University of Victoria).

(2000b). “Export-led growth: A survey of the empirical literature and some

noncausality results: Part II”, Journal of International Trade and Economic
Development, vol. 9, pp. 445-470.

Greenaway, D. and D. Sapsford (1994). “Exports, growth, and liberalization: An

evaluation”, Journal of Policy Modelling, vol. 16, pp. 165-186.

Grossman, M.G. and E. Helpman (1989). “Product development and international

trade”, Journal of Political Economy, vol. 97, No. 6, pp. 1261-1283.

Guti€rrez de Pi€eres, A., Sheila and Michael Ferrantino (1997). “Export diversification
and structural dynamics in growth process: The case of Chile”, Journal of
Development Economics, vol. 52, pp. 375-391.

International Monetary Fund (1998). Myanmar: Recent Economic Developments and

Selected Issues, (Washington DC, IMF).

(1998). Bangladesh: Selected Issues and Statistical Appendix, Country

Report Nos. 98/130 and 98/131 (Washington DC, IMF).

(1999). Nepal: Recent Economic Developments No. 99/18 (Washington

DC, IMF).

Johansen, S. (1988). “Statistical analysis of cointegration vectors”, Journal of

Economic Dynamics and Control, vol. 12, pp. 231-254.

(1991). “Estimation and hypothesis testing of cointegration vectors in

Gaussian vector autoregression models”, Econometrica, vol. 59, pp. 1551-1580.

(1992). “Determination of cointegration rank in the presence of a linear

trend”, Oxford Bulletin of Economics and Statistics, vol. 54, pp. 383-397.

Jung, S.W. and P.J. Marshall (1985). “Exports, growth and causality in developing
countries”, Journal of Development Economics, vol. 18, pp. 1-12.

Krugman, Paul (1979). “A model of innovation, technology transfer and the world
distribution of income”, Journal of Political Economy, vol. 87, pp. 253-266.

Ministry of Commerce, Government of Nepal (1992). Trade Policy (Kathmandu).

74
74

74 747474
Ministry of National Planning and Economic Development, Government of Myanmar
(1998). Review of the Financial, Economic and Social Conditions for 1997/
1998, English foundation (Yangon).

Prebisch, Raiel (1950). The Economic Development of Latin America and Its
Principal Problems, (New York, United Nations).

(1984). “Five stages in my thinking on development”, in Pioneers in

Development, Gerald Meier and Dudley Seers (eds.), (New York, Oxford Uni-
versity Press), pp. 173-196.

Riezman, R.G., P.M. Summers and C.H. Whiteman (1996). “The engine of growth or
its handmaiden? A time series assessment of export-led growth”, Empirical
Economics, vol. 21, pp. 77-113.

Schmitz, A. (1989). Free Trade and Agricultural Diversification: Canada and the
United States (Boulder, Westview Press).

Segerstrom, P.S., T.C.A. Anant and E. Dinopoulos (1990). “A Schumpeterian model

of the product life cycle”, American Economic Review, vol. 80, pp. 1077-1091.

Shan, J. and F. Sun (1998a). “Export-led growth hypothesis for Australia: An

empirical re-investigation”, Applied Economics Letters, vol. 5, pp. 423-428.

(1998b). “On the export-led growth hypothesis: The econometric evidence

from China”, Applied Economics, vol. 30, pp. 1055-1065.

(1998c). “On the export-led growth hypothesis for the little dragons: An
empirical re-investigation”, Atlantic Economic Journal, vol. 26, pp. 353-371.

Siegel, P. (1990). “Diversification of agricultural commodity exports in SARCC

countries”, paper prepared for World Bank (Washington, World Bank).
Agricultural Division, South Africa Department.

Singer, Hans W. (1950). “The distribution of gains between investing and borrowing
countries”, American Economic Review, Papers and Proceedings, vol. 40,
pp. 473-485.

Svedberg, P. (1991). “The export performance of sub-Saharan Africa”, Economic

Development and Cultural Change, vol. 39, pp. 549-566.

The Economist Intelligence Unit, Country Profile (London, Business International

Limited), various issues.

Trade Promotion Centre, Nepal Oversea Trade Statistics (Kathmandu, Government of

Nepal), various issues.

United Nations, International Trade Statistics Yearbook (New York, United Nations),
various issues.

75
UNCTAD (1995). Recent Developments in the Diversification of Developing
Countries’ Commodity Exports, UNCTAD/COM/62, (Geneva, United Nations
Conference on Trade and Development).

(1997). UNCTAD’s Contribution to the Implementation of the United

Nations New Agenda for the Development of Africa in the 1990s: African
Economic Performance, Perspective and Policy Issues, UNCTAD/TD/B44/12
(Geneva, United Nations Conference on Trade and Development).

(2000). ITC Databases: Aggregated Trade Statistics-Exports 1995-1999

(Geneva, International Trade Centre).

United States Department of State, Country Commercial Guides Fiscal Year 1999:
Bangladesh <http://www.state.gov/www/about-state/business/com-guides/1999/
eastasia/burma99.html>.

, Country Commercial Guides Fiscal Year 1999: Burma <http://

www.state.gov/www/about - state/business/com - guides/1999/eastasia/
burma99.html>.

, Country Commercial Guides Fiscal Year 1999: Nepal <http://

www.state.gov/www/about-state/business/com-guides/1999/sa/nepal99.html>.

, Country Commercial Guides Fiscal Year 1999: Malaysia <http://

www.state.gov/www/about - state/business/com - guides/1999/eastasia/
malaysia99.html>.

Vernon, R. (1966). “International investment and international trade in the product

cycle”, Quarterly Journal of Economics, vol. 80, pp. 190-207.

World Bank, World Development Report (Washington DC, Oxford University Press),
various issues.

World Trade Organization (2000). International Trade Statistics 2000, (Geneva,

WTO).

76
76

76 767676