This paper argues that the growing space for industrial policies, at least in its present form and shape, is unlikely to promote sustainable development in most Global South countries, especially in the smaller economies. This claim builds on those who have thought about structural transformations for and from the Global South throughout history. This vision contrasts with the policy recommendations of Rodrik, Mazzucato, and others who promote industrial policies as essentially national policies. They regard international cooperation and coordination in trade and investment with skepticism because it may erode the national policy space to implement these policies. My argument ultimately is not against industrial policies or a more active role of the state. Instead, a critical insight is that WTO rules were never the only reason against industrial policies or economic experimentation in the Global South, and that cooperation and coordination remain necessary to promote sustainable development on a global scale.
Photo by Anamul Rezwan