Towards a More General Approach to Trade Liberalization (original) (raw)

Asian Trade and Western Economics: Towards a More General Approach to Trade Liberalisation

Despite the frequency with which they have been promoted as a model of development, East Asian trade policies have had little influence on the normative economics of trade reform. In contrast to directly dismantling protection, developing countries have often provided concessional import rights which override existing protection. These instruments include EPZs and duty remission. This paper accommodates these instruments of 'new trade liberalisation' within a more general understanding of trade liberalisation illustrating their similarities and their differences. Both old and new trade liberalisation can, on their own, bring about complete free trade. Needless to say, so far, neither has! * [P]olicymakers have something on their side. Recall that deficit spending as an instrument to create employment preceded the General Theory. Economists should be a little more cautious in assuming that policy wisdom is necessarily on their side. In the area of trade policy I . . . doubt w...

Comparative study of trade liberalization regimes: the case of China’s accession to the WTO

2000

During the past twenty years, the Chinese economy has become substantially more integrated into the world economy. China's share of world exports has risen dramatically, and its composition has shifted strongly away from primary commodities towards manufactures. China's recent offers for WTO accession involve another large step forward in integrating China into the world economy. Central to China's liberalization over the past decades have been tariff exemptions on inputs used in the production of exports. While these "new trade liberalization" instruments have overridden existing protection in China and have effectively opened up many sectors of the Chinese economy, they have been given relatively little attention either in trade negotiations or in multilateral trade liberalization studies. This paper provides a new modeling framework that permits the analysis of large-scale liberalization scenarios in the presence of "new trade liberalization" instruments. Our results suggest that failure to account of the duty exemptions on imports for production of exports will significantly misstate the impact of China's accession to the WTO on the country's structure of production and trade. More specifically, we found that studies which abstract from the presence of duty exemptions might overstate the increase in China's export share due to accession to the WTO by as much as 75 percent, in the case of apparel, and the increase in China's welfare due to accession by more than 66 percent!

From protectionism to free trade fever? Recent reforms in developing countries

Open Economies Review, 1995

During the 1980s, increasing numbers of developing countries unilaterally liberalized their trade regimes. This paper presents an overview of this dramatic shift from protectionism toward freer trade. South Asia, Latin America, and East Asia have implemented extensive reforms, yet each region has shown a distinct difference in approach and in the degree of liberalization actually achieved. Latin America stands out as moving sharply toward the level of openness of the East Asian Newly Industrialized Countries (NICs). Only in Africa is there little progress toward freer trade.

MODERN MECHANISMS OF FOREIGN TRADE LIBERALIZATION

In a market economy, countries seek to maximize the benefits of international exchange within their capacities. Small countries, unable to change world trade conditions for their benefit, liberalize markets in anticipation of benefiting from increased economic efficiency. Meanwhile, different countries choose different ways of foreign trade liberalization. After studying the international experience, two main ways of foreign trade liberalization have been distinguished - mutual and unilateral trade liberalization, each of which has its own varieties. Mutual liberalization of trade is carried out on a bilateral, regional and multilateral basis, and unilateral liberalization is manifested in two ways: autonomous and unilateral preferential liberalization. Mutual multilateral and unilateral autonomous forms of foreign trade liberalization are favorable in terms of ensuring free competition in international trade, whereas differentiated approaches to bilateral, regional and privileged forms of liberalization have patronage elements.