The South-South Trade : A Structural Change Transforming Economies

The developments in the trade flows during the last few decades show a changing structure of it as trade between countries other than developed ones has gaining more importance than ever. Traditionally, raw materials and goods based on labor intensive or low skill, low technology production flow from developing countries, the South to the developed world, the North. The South imports goods based on capital intensive production and high technology from the North. However, because of the recent financial crises and the economic turmoil started in the developed world, the South has to diversify its exports markets. The increased economic activity and dynamic economic environment together with favorable demographics, the South emerged as an additional market for themselves especially in the last years. With the increase in the overall growth of the South and its decreasing dependence on trade to the North, the South-South trade -trade among countries of the South can provide basis for meeting the developmental goals of the South. This study shows these changes and discusses the implications of these changes for Islamic Development Bank Group's Member Countries