Walking and chewing gum at the same time: Australia’s free trade area strategy

The pursuit of free trade area agreements (FTAs), according to some, does not impede the multilateral trade negotiations process. It is argued to the contrary in the present paper that the FTA approach does impede the multilateral one. Comments are offered on common approaches to the analysis of the impact of FTAs, on the reasons why, despite concerns evident in these comments, the FTA strategy has become so popular, and on ways out of a dilemma of FTA proliferation, or at least ways to avoid the risks associated with it.International Relations/Trade,

US and EU Trade Policies and East Asia

This article identifies a number of examples of apparent lack of coherence in United States and European Union trade policies. They include the effect of preferential policies that lock in trade shares and inhibit growth promoting structural adjustment, biases in tariff structures, policies that affect incentives of developing countries to make commitments in the World Trade Organisation, the use of anti-dumping actions and the nature of tariff peaks and escalation. The origins of the lack of policy coherence lie within the domestic policy-making processes of the developed economies. An important question, then, is whether opportunity exists for East Asian economies to mobilise to induce an external shock sufficient to shift policy consensus in the United States and the European Union The key elements of such a grand bargain on trade in manufactured goods would include an explicit East Asian commitment to bind more tariff lines, initiatives to resolve the problem of accelerating anti-dumping actions and a replacement for the program of tariff preferences. A package of trade policy reforms of this type in East Asia would constitute a substantial offer and benefit to the United States and the European Union. It has the potential to trigger a response of equal benefit to East Asian economies.trade policy, US, EU, East Asia

US AND EU TRADE POLICIES AND EAST ASIA

This article identifies a number of examples of apparent lack of coherence in United States and European Union trade policies. They include the effect of preferential policies that lock in trade shares and inhibit growth promoting structural adjustment, biases in tariff structures, policies that affect incentives of developing countries to make commitments in the World Trade Organisation, the use of anti-dumping actions and the nature of tariff peaks and escalation. The origins of the lack of policy coherence lie within the domestic policy-making processes of the developed economies. An important question, then, is whether opportunity exists for East Asian economies to mobilise to induce an external shock sufficient to shift policy consensus in the United States and the European Union The key elements of such a grand bargain on trade in manufactured goods would include an explicit East Asian commitment to bind more tariff lines, initiatives to resolve the problem of accelerating anti-dumping actions and a replacement for the program of tariff preferences. A package of trade policy reforms of this type in East Asia would constitute a substantial offer and benefit to the United States and the European Union. It has the potential to trigger a response of equal benefit to East Asian economies.US, EU, trade policy, East Asia

FUTURE TRADE RESEARCH AREAS THAT MATTER TO DEVELOPING COUNTRY POLICYMAKERS

behind the border, WTO, policy

Private sector participation in infrastructure investment

Private participation in the provision of infrastructure is less than was once expected, particularly in developing countries. Some reasons for this are identified in this paper. It is argued that the problem of dealing with market power in the provision of infrastructure services is similar to that of other forms of procurement in the presence of long-lived and immobile assets employed specifically to produce an item or service

The APEC air transport schedule

The meeting of Asia Pacific Economic Cooperation (APEC) Transport Ministers in June 1995 asked a small group of members to draw up a paper to identify options for ‘more competitive air services with fair and equitable opportunity for all APEC member economies’. This paper was prepared at a meeting of the Small Group in October 1995.2 The paper was submitted to Transport Ministers but it was not until this year at the 1997 meeting of Transport Ministers that the issue became active again. The 1997 ministerial group asked the Small Group to reconvene to provide more advice on ‘priorities’ among the list of options that it had prepared. It is argued below that the original paper raised some of the important issues in this sector but that it could have gone further, and that certainly some of the ideas require elaboration before the proposals can be ordered into priorities. The aim of this paper is to present a framework in which a fuller set of options can be generated and evaluated. It is also intended to illustrate the application of this framework with a set of suggestions for an APEC agenda (see Table 3 for a summary of those suggestions). The next section of the paper outlines the nature of the current regulatory arrangements for international aviation. There follows a discussion of some of the pressures for change in the system. The policy options suggested by APEC’s Small Group and those proposed by a number of other reports are then examined in the context of this review of the features of the system and the forces for change. The paper concludes with suggestions about APEC’s air transport ‘schedule’

Are Preferential Tariffs Utilized? Evidence from Australian Imports, 2000-9

Preferential tariff rates are often not utilized by qualified beneficiaries. Two reasons are complex rules of origin and erosion of preference margins as a result of multilateral trade liberalization. Our paper contributes to this research by providing evidence from high-quality disaggregated customs data of the utilization rate for Australia's preferential trading arrangements in the period 2000-9. A pattern of low ratios of imports receiving preferential tariff treatment to the total value of bilateral imports applies to all six of Australia's PTAs. Over half of Australian imports from New Zealand, the Pacific Island Forum economies, Thailand and Chile claimed preferential treatment in 2000, but all had lower utilization rates by 2009. This is primarily because of the increasing number of zero MFN tariff lines. Where MFN tariffs are positive, preferential tariffs are utilized and preferred trading partners pay lower customs duties. Positive utilization rates indicate that tariff preferences do have an impact, and at a minimum the exporters claiming the preferential tariff rate are better off than they would be in its absence, but by themselves utilization rates shed no light on the size of the impact on trade flows or on economic wellbeing.preferential tariffs, trade liberalization, preference erosion

Impact of FDI on Domestic Firms' Exports in China

Using manufacturing industry firm-level census data from the period of 2000-2003 in China, this paper examines the impact of foreign direct investment on domestic firms' exports. After dealing with econometric problems of endogeneity and sample selection, we find that foreign direct investment in China has had a positive impact on domestic firms' export value through backward industrial linkages and a positive impact on domestic firms' export propensities in the same industry through demonstration effects. In particular, non-exporting FDI firms and FDI firms producing homogeneous products are more likely to generate the positive export spillovers to domestic firms through industrial linkages while exporting FDI firms and FDI firms producing heterogeneous products are more likely to generate positive export spillovers to domestic firms through demonstration effects in the same industry.Foreign Direct Investment, export spillovers, industrial linkage

New directions in Australian air transport

The events of September 11 2001 and the Ansett collapse a few days later have had a major impact on the Australian air transport markets. In this paper, we examine the immediate and longer-term competitive outcomes associated with these developments, and review the policy issues that arise