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Making sense of the Middle Income Trap

The debate is about reforms needed to enable countries to grow past the 'easy' phase of economic growth.

A worker at a production line in Kuala Lumpur. Malaysia and Thailand are taken to be exemplars of the Trap, given their upper middle income status and fears that they are no longer competitive in established niches.

WHILE it is a wide-ranging concept, the Middle Income Trap (MIT) usually refers to countries that have reached a certain level of per capita income on the basis of labour-intensive tasks and are struggling to transition towards more skill-intensive and sophisticated activities. Unable to compete