Trade can be a boon for developing nations, offering residents newfound economic opportunities. Bigger markets for goods once limited to local sales, higher prices for goods that rise in demand, more jobs — all are potentially beneficial spikes that can translate to lower levels of poverty and crime.

“I believe that communities isolated from the global economy can become breeding grounds for terrorist groups,” says Romaine Seguin, president of UPS International Americas Region. “Would the 300 girls from Chibok, Nigeria, kidnapped by Boko Haram, still be in school if the conditions that give rise to terrorism were different?”

Yes, trade can be great for an up-and-coming country, but not in a vacuum, says Raju Jan Singh, program leader at the World Bank. “You also have to equip people to seize these opportunities.”

According to Singh, assuming the availability of literate workers who can rapidly adopt new skills, two other factors contribute to how well a developing country can turn trade into success.

• Availability of credit. New equipment will likely need to be purchased. How easily can the private sector access credit?
• Business environment. In many countries the private sector is dominated by a handful of big companies. Trade can allow outside competitors to shake up the status quo, driving old businesses to innovate, but is the door open to newcomers? Can bright entrepreneurs start new businesses?

“In our research, looking at the relationship between trade and poverty, we’ve found that when these indicators are at relatively high levels, trade is associated with lower rates of poverty. When these variables are low, more trade is associated with more poverty,” Singh says.

Makes sense. When one business or industry thrives, another may falter. Improved education and access to credit are keys to a worker’s survival. “Helping former manufacturing employees think about different lines of business, for example, and taking a hard look at their skills to see how they can be employed in different lines of work also will go a long way,” Singh says.

Geography is another consideration. People who build roots in villages need a good public transportation system to get to and from jobs that may no longer be local. They may even have to relocate, which isn’t necessarily feasible.

While implementing new trade opportunities has its challenges, the potential benefits trade delivers are clear, not only for the developing country but also for U.S. businesses. If you’re exporting machinery, for example, a developing country that gains access to better machines may in turn make better products, which increases competition and can have a positive effect on the entire sector.

“Trade forces companies to stay on their toes,” Singh says. “If proper policies are also put in place, exporters and importers alike are driven to do better.”

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