What constitutes a developing country?

ALAN PEAT
WHERE DOES SA stand as an economic entity – a “developed”, less-developed” or “developing” country? Fin24, carrying an Associated Press (AP) report, has just thrown another definition into the works – quoting one developed by the United Nations (UN). The question it faced was: What makes a developing country? The UN lists all European Union (EU) members – Canada, the US, Australia, Israel, Japan, New Zealand, Norway, Gibraltar, Switzerland and Iceland – as “developed”. The former Eastern Bloc countries who are not members of the EU fall into a separate “less-developed” category, while the rest of the world is classified as “developing”. “This means that the oil-rich countries of the Gulf, all of Central and Latin America, as well as the offshore tax havens of the Caribbean and the so-called ‘Asian tiger’ economies of Hong Kong, Taiwan, South Korea and Singapore are considered developing countries – despite in many cases having a higher gross domestic product than some of the newer EU states.” It’s not much changed from the says of GATT (the general agreement on trade and tariffs) – the forerunner of the current World Trade Organisation (WTO) – when “1st world; 2nd world and 3rd world” performed on the global stage, according to Riaan de Lange of SA Tariff and Trade Solutions. And the suggestion under the latest UN definition that Singapore, for example, could claim all the same developing nation trade benefits as Burundi, really falls apart at the seams in practice. “It all depends on which international body is making the decision,” De Lange told FTW, “and the purpose of its definition. “And everything is decided at multi-lateral level.” As Fin24 reported, the WTO does not have set rules for who is and who isn’t developed. Instead, countries decide for themselves whether to sign up as developing countries – a classification that brings a number of benefits under WTO rules. “But,” said De Lange, “although SA might have aspirations to be included amongst the developing nations, the WTO has decided that its economic muscle merits a “developed country” tag. However, it’s still a razzmatazz of definitions out there. “It’s a question for which there is no definitive answer,” said De Lange.