1.  Sectoral Imbalances: over-specialisation in primary products (eg. agriculture, mining, oil) may leave economy vulnerable  Demographic Transition Thresholds: - as development takes place, death rates fall faster than birth rates – population soars – slightly ↑ GDP may ↓ GDP/head

2.  Lack of Finance & Burden of Debt Repayments: many countries can’t get on the path of ↑ incomes, ↑ tax revenues, ↑ public sector investment - efforts to repay debt may ↓ public sector investment → ↓ FDI – a cycle of ↑ degradation of resources & ↓ economic potential

3.  Capital flight: funds may leave the country when accumulated due to higher returns elsewhere  Foreign currency gap: not enough foreign currency to import necessary commodities to stimulate growth (not enough exports)  Savings gap: inadequate gathering of funds means not enough for investment

4.  Poor infrastructure – health, transport, education, attracting MNC’s  Human capital deficiencies – education, health, experience  Poor governance – weak decision making, no enforcement power, civil wars, etc

5.  Corruption: corrosive to an economy - money intended for public sector may be siphoned off to individuals - money spent maintaining political structure against the general will - contracts may be awarded on basis of non-market criteria  However: corruption exists everywhere – it may just be more invisible in developed countries

6.  Volatile commodity & primary product prices: traditionally the main export of developing countries  Low levels of FDI  Global recession / fear of terrorism  Uneven access to world markets owing to tariffs, subsidies, etc.