Poor nations advised to make parts

The countries of the "Bottom Billion" could break free from poverty by manufacturing individual components rather than entire items, a United Nations agency has said.

Dr Kandeh Yumkella, director general of the UN Industrial Development Organisation (UNIDO), said the poorest countries should choose the right products to manufacture for the global market.

He warned against reliance on the export of natural resources, as commodity prices were subject to the volatility of the markets.

Launching the Industrial Development Report 2009, Dr Yumkella said that over a billion people from a global population of 6.7 billion were living on less than one US dollar a day.

The report aimed to help the "Bottom Billion" by identifying a set of policies to help the poorest countries accelerate their economic growth, he said.

Dr Yumkella cited ten case studies in developing countries where task-based production - the production of individual components rather than whole items - had made a "significant difference" in economic development.

The city of Qiaotou in China, for example, built its industry on the production of buttons and now accounts for 65 per cent of the world's buttons.

Poorer countries should not rely on the export of primary commodities as this could discourage the growth of manufacturing and hinder broad-based development, he said.

While the sale of natural resources may produce prosperity for a few people, converting the income into assets for sustainable development was "much harder".

Instead, task-based industrial production could capture "niche markets" and encourage more widespread development.

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