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A Diversification Strategy for South Asia
Author:
Weicheng Lian null

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,
Fei Liu
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Katsiaryna Svirydzenka
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Biying Zhu
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Series:
IMF Working Papers
Volume/Issue:
Volume 2021: Issue 202
Language:
English
Publication Date:
30 Jul 2021
DOI:
https://doi.org/10.5089/9781513584799.001
ISBN:
9781513584799
ISSN:
1018-5941
Pages:
49
Keywords:
summary statistic; outlook index; Economics complexity; South Asia's progress; diversification of export; Export diversification; Exports; Infrastructure; Income; South Asia
Legal-disclaimer:
IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.
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While South Asia has gone a long way in diversifying their economies, there is substantial scope to do more. Some countries – India, Nepal, and Sri Lanka – can build on their existing production capabilities; others – Bangladesh, Bhutan, and the Maldives – would need to undertake a more concerted push. We identify key policies from a large set of potential determinants that explain the variation in export diversification and complexity across 189 countries from 1962 to 2018. Our analysis suggests that South Asia needs to invest in infrastructure, education, and R&D, facilitate bank credit to productive companies, and open to trade in order to diversify and move up the value chains. Given the COVID-19 pandemic, investing in digital technologies as part of the infrastructure push and improving education are of even greater importance to facilitate the ability to work remotely and assist resource reallocation away from the less viable sectors.
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Cover IMF Working Papers
IMF Working Papers
ISSN:
1018-5941
Publisher:
International Monetary Fund