Question

A. Why might it be that a country rich in natural resources, say, like, Zimbabwe, cannot out produce in GDP and productivity, Singapore, a city-state in Southeast Asia with comparable few resources?

B. How does specialization in trade lead to greater economic prosperity for a nation?

C. Though, perhaps, a bit too early to tell, from your readings of various business app's and/or associated periodicals, what's the prognosis as to how the Coronavirus (COVID 19) will impact global trade into 2021? '22?

Answer 1

i) A country rich in natural resources cannot out produce in GDP and productivity compare to a country which have limited resources, this type of situation known as resource curse. The resource curse, also named as the paradox of plenty, means to the paradox that nations with a bounty of natural resources, result to have little economic extension, little democracy, and unpleasant expantion outcomes than countries with limited natural resources.
Zimbabwe’s rich resources support has declined to launch the country into economic development due to an eradication model of development. On the other hand Singapore has a highly-developed and prosperous free-market economy and has made the most of its restricted natural and human resources. It has enjoyed an exceptionally open and corruption-free atmosphere, steady prices, and a per capita GDP more than that of most developed nations.

b. When nations have various opportunity costs in production they can gain profit from specialization and trade. Profits of specialization include bigger economic planning, customer profits, and chances for growth for competitive zones.
Specialization can enhance the prolificity and give a comparative superiority for the economy. Microeconomic specialization implies the individual sectors and economic elements and macroeconomic specialization implies the broad benefit an economy has in production.

c. The heading coronavirus pandemic has entrupted international trade flows, wipe out emerging markets dependent upon imports and exports and leading to scarcity of medical and other obligatory supplies around the world.
But analysts are forecasting there may not be a return to pre-outbreak conditions once the spread of the disease has been brought under command. Many believe the outbreak has forever altered the global flow of goods and services, as the theory of globalization drops political popularity and companies want to minimize dependence on certain nation.