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Newly industrialized countries

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Newly industrialized countries


The category of newly industrialized country (NIC) is a socioeconomic classification applied to several countries around the world by political scientists and economists.

NICs are countries whose economies have not yet reached developed country status but have, in a macroeconomic sense, outpaced their developing counterparts. Another characterization of NICs is that of nations undergoing rapid economic growth (usually export-oriented). Incipient or ongoing industrialization is an important indicator of a NIC. In many NICs, social upheaval can occur as primarily rural, or agricultural, populations migrate to the cities, where the growth of manufacturing concerns and factories can draw many thousands of laborers.

NICs usually share some other common features, including:

Historical context

The term came into use around 1970, when the Four Asian Tigers[1] of Hong Kong, Singapore, South Korea, and Taiwan rose to global prominence as NICs in the 1970s and 1980s, with exceptionally fast industrial growth since the 1960s; all four economies have since graduated into advanced economies and high-income economies. There is a clear distinction between these countries and the nations now considered NICs. In particular, the combination of an open political process, high GNI per capita, and a thriving, export-oriented economic policy has shown that these countries have now not only reached but surpassed the ranks of many developed countries.

All four economies are classified as High-income economies by the World Bank and Advanced economies by the International Monetary Fund (IMF) and U.S. Central Intelligence Agency (CIA). All of them, like Western European countries, possess Human Development Index considered "very high" by the UN.

Current NICs

The following table presents the list of countries consistently considered NICs by different authors and experts.[2][3][4][5] Turkey and South Africa are classified as developed countries by the CIA.[6] Turkey was a founding member of the OECD in 1961 and Mexico joined in 1994. The G8+5 group is composed of the original G8 members in addition to China, India, Mexico, South Africa and Brazil.

Note: Green-colored cells indicate higher value or best performance in index, while yellow-colored cells indicate the opposite.

Region Country GDP (PPP)
(Billions of USD, 2011 World Bank)[7]
GDP per capita (PPP)
(international dollars, 2012 IMF)[8]
Income inequality (GINI) 2008-09[9][10] Human
Development
Index
(HDI, 2013)[11]
GDP (real) growth rate as of 2013 Sources
Africa  South Africa 555.340 11,302 63.1 0.629 (medium) 2.5 [3][4][5]
North America  Mexico 1,659.016 15,300 48.3 0.775 (high) 3.9 [2][3][4][5]
South America  Brazil 2,309.138 12,038 54.7 0.730 (high) 0.9 [2][3][4][5]
Asia  China 11,316.224 9,146 45.3 0.699 (medium) 7.8 [3][4][5]
 India 4,469.763 3,851 32.5 0.554 (medium) 6.5 [3][4][5]
 Indonesia 1,223.488 5,302 36.8 0.629 (medium) 6.2 [3][4][5]
 Malaysia 447.595 16,942 46.2 0.769 (high) 5.6 [3][4][5]
 Philippines 424.355 4,264 43 0.654 (medium) 6.6 [2][3][4][5]
 Thailand 622.914 10,823 40 0.690 (medium) 6.4 [2][3][4][5]
Europe  TurkeyTemplate:Efn 1,288.638 15,029 39 0.722 (high) 2.6 [3][4][5]

According to Goldman Sachs review of emerging economies, by 2050 the largest economies in the world will be as follows: China, USA, India, Brazil, and Mexico.[12]

For China and India, the immense population of these two nations (each with over 1.1 billion people as of January 2009) means that per capita income will remain low even if either economy surpasses that of the United States in overall GDP. When GDP per capita is calculated according to purchasing power parity (PPP), this takes into account the lower costs of living in each newly industrialized country.

Brazil, China, India, Mexico and South Africa meet annually with the G8 countries to discuss financial topics and climate change, due to their economic importance in today's global market and environmental impact, in a group known as G8+5.[13] This group is expected to expand to G14 by adding Egypt alongside the five forementioned countries.[14]

Other NICs

Authors set lists of countries accordingly to different methods of economic analysis. Sometimes a work ascribes NIC status to a country that other authors don't consider NIC. This is the case of nations such as Argentina, Chile, Egypt, Sri Lanka[15] and Russia.[2]

Brief economic analysis

NICs usually benefit from comparatively low labor costs, which translates into lower input prices for suppliers. As a result, it is often easier for producers in NICs to outperform and outproduce factories in developed countries, where the cost of living is higher, and labor unions and other organizations have more political sway.

This comparative advantage is often criticized by advocates of the fair trade movement.

Issues

Economic freedom is not always associated with political freedom in nations such as the People's Republic of China, where Internet censorship and human rights violations are common.[16] The case is diametrically opposite for the Republic of India. While being a liberal democracy throughout after its independence, India has been widely criticized for its inefficient governance and slow process of structural reform. Thus, while political freedom in China remains limited, the average Chinese citizen enjoys a higher standard of living than his or her counterpart in some regions of India.[17] South Africa faces an influx of immigrants from countries such as Zimbabwe. Mexico's economic growth is threatened by an ongoing drug war in the north of the country.[18]

See also

Groupings:

Notes

Template:Notes

References

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