This article concentrates on problems of native peoples in the context of technical change moulded by institutionalized racism. External specialists are often imparted to developing countries in order to introduce advanced technology as well as to organize and run the administration. Native workers are presumed to gain know-how from work experience and take over management and professional jobs gradually as they learn from the foreign professionals. However, this strategy may suffer from conflicts between the foreign professionals and natives due to different cultures and ethnic backgrounds. Learning processes are undermined by these conflicts creating mistrust and lack of confidence. These conflicts often develop into institutionalized racism involving organized forms of exclusion such as overvaluation of formal education as opposed to native knowledge. The result is permanent reproduction of the need for imported specialized labour and 'destructive forgetting' of local culture.