In the last two decades, many economists and policymakers have debated the risks and solutions to the economic problems raised by the middle-income trap. The framework of the middle-income trap (MIT) is simple --- middle-income countries get stuck at economic stagnation because manufacturers in these countries are too rich to compete on low-cost labor, while their technologies are too unsophisticated to compete on that of high-tech markets. This economic stagnation could raise many economic and social problems. Many countries that have been caught in the MIT, especially the Latin American economies, have failed to promote structural changes in their economic systems. Their economies have regressed towards previous development stages. Moreover, in the past century, only two economies have managed to break out from the MIT--- Chinese Taiwan and South Korea. China has achieved miraculous GDP growth at an average annual rate of 9.4% in the past 40 years, but now it has also fallen into the MIT with GDP per capita (nominal) in 2019 of 10,262 US dollars.
Although countries listed in the group of middle-income economies are highly different concerning the economic structures and their levels of technological development, they have experienced the same difficulties to catch up towards the high-income level of developed countries. Moreover, throughout their development process, these countries have faced similar external forces in terms of both the global industrial landscape and global policy regime.
In addressing how to break out of the MIT they have adopted different strategies and have deployed various policies. This presentation will offer a different perspective on this debate drawing from the experience on the cases of Latin American economies. It illuminated the real meaning of being caught in the MIT and discussed the key challenges and possible strategies for China to break out of this economic trap.
Professor Golombiewski Teixeira is a Professor of Public Policy at School of Public Policy and Management at Tsinghua University and Professor of International Business at Schwartzman College also at Tsinghua University.
Professor Golombiewski Teixeira has spent his last 20 years working in academia, government, international institutions, and private sector at the same time. Professor Golombiewski Teixeira has a unique background with a broad perspective in different areas such as Innovation and Industrial Policies, Development Policies, International Trade, Foreign Direct Investment, International Marketing among others. Prof. Golombiewski Teixeira has more than two decades of extensive teaching and research experience in Europe, Latin America, and North America, across different courses ranging from undergraduates to postgraduates. More recently he was a visiting Professor at Columbia University, Associate Senior Researcher at Denver University in the USA. He held different Lecturer and research position in University of Sussex (UK) and in Brazilian Universities such University of Sao Paulo, Federal University of Rio Grande do Sul among others.
Professor Golombiewski Teixeira has a wealth of senior experience in policy-making in his home country, Brazil, Latin America and Internationally. For more than 15 years Professor Golombiewski Teixeira has been at the forefront of initiatives holding high-level positions in the Brazilian Government and International Organizations with a very high profile and international exposure.
Professor Golombiewski Teixeira also has served as board member of the Brazilian National Development Bank for 12 years, National Energy Committee, National Science and Technology Committee, National Infrastructure Committee and in more than a dozen Brazilian and international private sector companies such as Klabin and Suzano Paper and Pulp Brazilian giants, Lupatech gas and oil International company, AES Electrical Power Corporation among many others.