International trade and economic growth

Abstract

This chapter pointedly addresses the issues of international trade and economic growth. Economic growth and development are complementary because nations that want to develop must first establish that they can grow. That is, economic growth stimulates development. The chapter opens with a review of the theories of international trade to establish the socio-economic benefits that could be derived from international trade when the gains from international trade are imperatively invested and equitably distributed for the common good. The trade treaties of Sierra Leone are evaluated in the content of international trade law and the equity that is required when nations engage in international trade among themselves. In the final analysis, it is prudent for nations to diversify their articles of trade and maintain a reasonable number of foreign reserves to support the stability of their currencies and social programs that are necessary to obtain any measure of development. Accordingly, this chapter also looks at Sierra Leone’s articles of trade, effects of exogenous shocks, and the repercussions of trade imbalances for the country. Some historical lessons or comparisons for resolving current account problems are presented at the end of the chapter.

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