In export-oriented industrialization (EOI), what policy approach is typically emphasized?

• A. Tariffs to protect domestic market.
• B. Export subsidies and policy support to integrate into global markets.
• C. Complete isolation from global markets.
• D. Deregulation of all sectors with no policy support.

Answer: (B)

Export-oriented industrialization aims to grow by selling goods abroad, so the government actively creates conditions for that to happen. The best approach is to back exporters with subsidies and policy support that help firms connect to global markets—things like financial incentives, streamlined export procedures, and infrastructure tailored to export activity. This outward focus lets domestic producers scale up, gain access to foreign demand, and earn foreign exchange, which is essential for sustained growth in EOI.

Tariffs to protect the domestic market align more with import-substitution strategies that try to shield local firms from competition rather than push them to compete internationally. Complete isolation from global markets contradicts the whole idea of exporting-oriented growth. Deregulation with no policy support ignores the targeted measures governments use to boost exports, so it doesn’t fit this approach.