Preferential market access and foreign aid key to economic development in LDCs.
Exporters in less developed countries face high costs when selling to developed countries. Giving these countries special access to markets in developed nations can help reduce these costs. However, just having this special access isn't enough to boost economic growth in less developed countries. There are other issues that hold back their producers from taking full advantage of these opportunities. Research on preferential market access between the EU and ACP countries shows that this access can increase exports. But for it to actually help economic development, these countries also need enough foreign aid focused on trading activities.