The Importance of International Trade to Developing CountriesAnswer the following questions:1. State the main points in this passage.2. How to paraphrase the statement “Trade is still of vital importance to developing countries?”3. What are main imports or exports at each stage? The role of international trade is one of the most contentious in development of economics. Should countries adopt an open trade policy with few if any barriers to imports? Should governments go further and actively promote trade by subsidizing their export sector? Or should governments restrict trade and pursue a policy of greater self-sufficiency?Whether it is desirable that developing countries should adopt policies of more trade or less trade, trade is still of vital importance. Certain raw materials, capital equipment and intermediate products(中间产品) that are necessary for development can only be obtained from abroad. Others could be produced domestically, but only at much greater cost. In some cases it might be possible for a country to develop without trade. China, from 1949 to 1976, followed a policy of virtually no trade with the outside world. But such cases are exceptions. Certainly for smaller countries, with small domestic markets and a lack of resources, an absence of trade would greatly hinder development. Thus for most policy makers it is a question not of free trade versus no trade, but rather of more trade versus less trade.One of the most important considerations affecting a countrys trade policy is the state of its balance of trade. Many countries are desperately short of foreign exchange: their demand for imports has grown rapidly and their exports have not kept up. Given this situation, should a country concentrate on expanding its exports, or should it reduce imports and replace them home-produced goods (or go without them altogether)?As they develop, countries policies towards trade tend to change. Typically they go through various stages.Primary outward-looking stage: Traditionally, developing countries have exported primaries- minerals such as copper, tin and uranium, and cash crops(经济作物) such as coffee, tea, cocoa, sugar and tropical fruit, and non-food stuffs such as cotton, rubber and jute-in exchange for manufactured consumer goods. In their early phase of development, countries have little in the way of an industrial base, and thus if they want to consume manufactured goods they have no option but to import them.Secondary inward-looking stage: Most developing countries saw little prospect for rapid economic development by relying on primary exports. They therefore sought to draw lessons from the experience of the advanced countries. The main conclusion was that industrialization was the key to economic success.But if developing countries were to industrialize, this would require foreign exchange in order to purchase the necessary capital equipment; and with only a slow growth in primary exports, where was the foreign exchange to come from? The answer was to cut back on all non-essential imports and thereby release foreign exchange. The policy became known as import-substituting industrialization (IS)(进口替代型的工业化). The process by which this was done was to impose tariffs and other restrictions on those imports for which a domestic substitute existed or which were regarded as unimportant.Secondary outward-looking stage: There were limits to import substitution. Once an industry had satisfied domestic demand, it would have to seek markets abroad if expansion was to continue. What is more, as we shall see, import substitution brought a number of serious problems for developing countries. The answer seemed to be to look outwards again, only this time not to primary exports, but to the exports of manufactured goods. Many of the most economically successful developing countries or districts have owed their growth rates to a rapid expansion of manufactured exports.1