Import and Export

The Commonwealth factor

There is wide agreement within the Commonwealth that trade is a critical to economic growth, overall income and employment. The Commonwealth believes that access to international markets presents tremendous opportunities for poor countries to trade their way out of poverty. It also believes that an open trading system will help increase income levels and reduce poverty. Most Commonwealth countries are net importers with net imports* averaging 11% of GDP. Relatively speaking, Singapore and Malaysia are the greatest net exporters in the Commonwealth with net exports of 28% and 18% of GDP respectively (2010). Malaysia is highly dependent on trade, with trade volumes 85% of GDP**. Singapore, Malaysia’s neighbour, is the country most dependent on trade in the Commonwealth; its trade volume is twice its GDP. For over 30 years, both Malaysia and Singapore, have to an extent, been successful at harnessing the benefits of an export-oriented economy.

Commonwealth countries traded around US$4 trillion worth of goods in 2008, according to a study commissioned by the Royal Commonwealth Society. The study found out that intra-Commonwealth trade accounts for about one-sixth of total Commonwealth members’ trade, with an average for each member of around one-third. Commonwealth trade is dominant in some parts: more than four-fifths of Botswana’s and Namibia’s imports come from other Commonwealth countries. Indeed, the value of trade between pairs of Commonwealth member states is between 38 and 50 per cent higher than between pairs of countries where one or both are not Commonwealth members, controlling for other factors.

*Net exports= Exports minus Imports. When this is negative they become Net Imports

** Trade volume= (Gross imports + Gross Exports) divided by 2

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