Which development strategy is based on domestic manufacture of goods that were previously imported to satisfy domestic markets?

Which development strategy is based on domestic manufacture of goods that were previously imported to satisfy domestic markets?

• A. Export Substituting Industrialization
• B. Import Substituting Industrialization (ISI)
• C. Industrial Substitution
• D. Liberalization

Answer: (B)

Import substitution industrialization is a strategy that aims to reduce dependence on imported goods by developing domestic production for items that were previously imported to meet local demand. Governments promote this with protective tariffs, import quotas, subsidies, and state-led investment to build up local industries and shift the economy toward manufacturing for internal markets. This approach is different from strategies that push exports, or from liberalization, which lowers trade barriers overall.

Import substitution industrialization is a strategy that aims to reduce dependence on imported goods by developing domestic production for items that were previously imported to meet local demand. Governments promote this with protective tariffs, import quotas, subsidies, and state-led investment to build up local industries and shift the economy toward manufacturing for internal markets. This approach is different from strategies that push exports, or from liberalization, which lowers trade barriers overall.