Small Island developing states and globalization: Development potential

Abstract

Previous studies of small island developing states (SIDS) have emphasized their multiple disadvantages in relation to economic and social development due primarily to geographical factors such as their distance from major countries, and markets, their small size and populations, their dispersal across an immense area of sea, the high transaction costs involved in importing goods, and their vulnerability to natural disasters such as typhoons, tsunamis, and coastal erosion. The expansion and deepening of globalization increased the mobilization of migrant workers and advances in information technology led to changes in the international economic environment. Owing to their remoteness, these islands have retained their own unique natural environments and cultures, which in the current context of rising demand for international tourism can be regarded as valuable tourism resources. Increased demand for seafood worldwide has made fisheries resources extremely valuable and island nations will benefit through the fishing industry and their fishing rights. These cases can be seen in terms of a dynamic paradigm shift arising from the advance of globalization. However, other factors matter such as coastal erosion due to global warming, the economic and cultural impacts of foreign investment and influxes of foreign workers, and the low levels of success in achieving the millennium development goals (MDGs). In this chapter, the present condition of SIDS under the globalization was reviewed from a viewpoint of international macroeconomics.