The structural change of trade and economic development in Sabah, Malaysia

Wong, Kee-Bun (1974) The structural change of trade and economic development in Sabah, Malaysia. MLitt(R) thesis, University of Glasgow.

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There has generally been a lack of agreement as to the specific relation between foreign trade and economic development. The hypothesis presented here is that there is a causal relationship between the two, but it is the change of structure of foreign trade rather than growth of trade without structural change that generates economic development. Quantitatively, there is rather a structural change within the primary exporting sector than a change from primary to secondary sector, while the structural change in import trade from one functional import group to another is more conspicuous than the change within certain functional import group. Degrees of both commercial and geographic concentration of export trade have been high and increasing over time while those of import trade are low - quite stable in commercial concentration but a slight increase in geographic concentration. Owing to the difference in nature and production function, impacts of different exports and imports on economic development diverse. J?or the sake of analysis of different effects of different exports and imports, ten prime exports are selected and imports are classified according to their functional nature into five groups. The hypothesis is being- tested statistically by fitting linear and multiple correlation and regression equations in the logarithm using the data of annual gross national products, total and individual exports and imports, employment and trade balance, all in current market prices, during the period 1955-70. The overall result suggests that the structure of trade has been changing in favour of trade expansion financial development, the transformation of mechanisation and educational effects, and growth of tertiary employment, However, employment in agricultural and manufacturing sectors has been greatly lagging behind production. Owing to the highly commercial and geographic concentration which are caused by the large proportion of exports in raw forms in the total trade, and also to the rudimentary stage of industrialisation and other important internal rigidities, external economies so that created in the process of foreign trade were not able to be retained within Sabah and further transmitted to the rest of the economy. Therefore, financial, employment and spread effects of foreign trade upon economic development cannot be exercised to their maximum extent. The policy implication of the findings is that, in order to foster further economic development, Sabah should adopt the type of policies or strategies that will stimulate the growth of export sector and, at the same time, the growth of domestic activities. Such that to retain as high the forward linkages, and backward linkages as well, at home as possible.

Item Type: Thesis (MLitt(R))
Qualification Level: Masters
Additional Information: Adviser: G C Abbortt
Keywords: Economics, South Asian studies
Date of Award: 1974
Depositing User: Enlighten Team
Unique ID: glathesis:1974-73373
Copyright: Copyright of this thesis is held by the author.
Date Deposited: 14 Jun 2019 08:56
Last Modified: 14 Jun 2019 08:56

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