what is the middle-income trap? Since the end of the Second World War, a large number of low-income countries have succeeded in escaping the poverty trap and joined the ranks of a broad group of middle- income countries. But only a few, notably Japan. Korea, Chinese Taipei and Singapore in Asia, Israel in the Middle East, and Ireland in Europe, have sustained their development progress and transformed themselves into high income countries. In recent years, scholarly and policy attention has turned to explaining how and why most middle-income countries have failed to make the transition. This failure has been called the "middle-income-trap" (Gin and Kharas. 2007). It refers to a developmental stage characterised by a slowdown in growth due to an inability to move up the value chain, away from factor driven, export dependent growth and into new inn driven industries.The Gill and Kharas paper has spawned a lively controversy on the concept, causes and consequences of the middle-income trap (MIT) puzzle. Several studies (Agénor, Canuto and Jelenie, 2012. Canuto, 2011. Eichengreen. Park and Shin.2012) suggest the trap arises from a Lewis-type development process. A low-income country makes rapid economic initial stage of development as labour moves from low-productivity sectors like agriculture to higher-productivity labour intensive industries. In addition, expanded access to technologies allows it to reduce huge inefficiencies that had held the economy back. However, productivity gains from sector shifts and technology catch-up are eventually exhausted. Wages rise, undercutting the country's competitiveness in labour-intensive sectors but innovation does not take root, preventing the economy's evolution into new higher-value activities. Some evidence suggests that developing countries become vulnerable to the growth slowdowns characteristic of the MIT at two stages: one at around Income per capita of USD 10-11 thousand and again in the region of USD 15-16 thousand fat purchasing power parity exchange rates and 2005 prices) Same observers have questioned whether the growth slowdowns associated MIT can be viewed as a "trap" in any meaningful sense. They argue that protracted growth slowdowns can and have occurred at various levels of per-capita income and reflect the difficulties of sustaining development (Jiang. 2011). However, whether termed a "trap" or something else, the fact that so many middle-income countries have found it difficult to sustain their development progress points to the overriding challenge facing a large number of countries that have eliminated widespread poverty now in continuing to raise living standards and transformed themselves into advanced economies with strong innovation engines. Note in this outlook, we define the "middle-income trap" as a stractural transformation phenomenon where economies require a range of structural reforms in the process of changing from a model of "intrinsic" growth based mainly on factor accumulation to a model of "extrinsic" or Productivity led growth driven by improvements in the quality of human and physical capital and in the organisation of production and related business activities. This transformation is usually needed in economies that are categorised in the middle-income group