We see that many third world countries, although they have a lot of resources and the people work hard, can never develop. Why? Because their efforts are used as wedding dresses for others.

We see many third world countries. Although they have a lot of resources and the people work hard, they can never develop. Why?

Because of their efforts, they made wedding dresses for others.

Third world countries are actually developing countries, and China is also a third world country. The term

was proposed during the Cold War between the United States and the Soviet Union. At that time, the United States and the Soviet Union were first world countries. The second world countries were capitalist powers such as Europe, Japan, Australia, and Canada, and the rest Asia, Africa, and Latin America The countries are all third world countries.

At that time, third world countries were less developed and poorer countries.

In our understanding, a trade surplus means that exports are greater than imports. Simply put, it means that we have made money, which is our country's income;

A trade deficit means that imports are greater than exports, which means that we have spent too much money.

But for many third world countries, not all international trade surpluses can become the national economy.

Why?

Because most of the profits were taken away by capital European and American companies through deception.

So even though these countries have a lot of resources, they still cannot develop. The profits were taken away by European and American companies.

Trade and exports from these countries are done by European companies.

For example, exporting oil is exported by American oil companies;

exporting mineral deposits is also exported by American, British or other European companies.

And these companies will take away most of the profits through various means, and the little profit earned by resource exporting countries will also be deducted by these European and American companies.

How do they do it?

The parent companies of these companies are all in the United States or Europe, and these head offices have registered trading branches in tax havens.

Then these branches control the resource exports of these third world resource exporting countries.

These branches often sell the exported resources to their own parent companies at extremely low prices, so that they do not make much money at all in the accounts. In this way, resource exporting countries can only get very little profit.

Then the head office in the United States sells these resources to other buyers at high prices. The huge profits have nothing to do with the resource exporting country.

In addition, companies registered in tax havens do not need to pay corporate income tax, and they do not need to pay tax on their own profits.

Moreover, these tax havens use US dollars, and there is no exchange rate risk during the transaction.

They have to make various deductions for the little profit left to resource exporting countries.

For example, these European and American branches will say that the head office lent them money to invest here, so the branches do not need to repay the principal and interest.

In this way, these companies do not have to pay income taxes in these third world countries. In addition, they will also pay depreciation fees . These are costs that do not need to be paid to the country where the resources are located.

In order to export oil, the branch must import a large number of machines, as well as other production materials, such as chemical products, various goods and services, etc.

These imported production materials are costs and must be deducted from export earnings.

These companies also need to hire foreign managers and foreign workers. They will charge 10% of the export price as a management fee. The country where these resources are located must pay these sent American managers or British managers.

These so-called "costs" are true or false.

In the end, only 20% of the actual export price may be retained in the country, and 80% will flow to the foreign parent company in the form of profits or costs.

In this way, even though these third world resource exporting countries are rich in resources, they still cannot make much profit.

In this way, they actually rarely have a trade surplus. Current balance of payments calculations obscure this issue.

This was clear before the 1930s, but since Americans invented the accounting methods of gross national product GNP and national income GNI, they have treated exports as if they were all paid for in cash.

they blur everything.

It seems that these resource-rich countries have oil or raw material export industries, or export-oriented processing trade industries, but it is not necessarily a good thing for them.

Moreover, European and American countries will prevent the people of these countries from understanding this approach, because once their people understand all their hard work, most of them will become wedding dresses for European and American companies.

Then the pressure on the United States to continue investing in these countries will be much greater.