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Would general trade liberalization in developing countries expand South-South trade? (English)

For most developing countries, the proportion of exports going to other developing countries has steadily increased since the early 1970's. Until that time, most of the developing countries with an outward-looking trade strategy did proportionately less trade with other developing countries, particularly manufacturers. Since the early 1970's, however, an outward orientation has often gone hand in hand with more South-South trade. The proportionate increase in South-South trade occurred despite relatively higher protection in most developing countries against the products for which they, as a group, have a comparative advantage. As the annual growth rate slowed, it greatly affected the direction of developing countries trade. But the resumption of growth in industrial countries did not alter the increasing trend in South-South trade. The structure of tariff and nontariff protection in most developing countries discriminated against products that other developing countries could supply competitively. Hence, across the board, nondiscriminatory liberalization would generally favor South-South trade - particularly if liberalization focused on the most heavily protected sectors.

Details

  • Author

    Erzan, Refik

  • Document Date

    1989/12/31

  • Document Type

    Policy Research Working Paper

  • Report Number

    WPS319

  • Volume No

    1

  • Total Volume(s)

    1

  • Disclosure Date

    2010/07/01

  • Doc Name

    Would general trade liberalization in developing countries expand South-South trade?

  • Keywords

    direction of trade;round of multilateral trade negotiation;comparative advantage;trade among developing countries;South East Asian;elimination of trade barrier;annual average growth rate;high levels of protection;share of export;manufactured export;comparative advantage index;returns to scale;regional integration scheme;economies of scale;regional trading arrangements;export of capital;protection can;labor-intensive product;production and export;capital intensive goods;income developing country;cross country differences;technology and resources;trade in manufacture;effective protection rates;share of import;gdp growth rate;middle-income developing countries;long term development;market of destination;newly industrializing country;share of trade;geographical region;industrial country;export share;trend analysis;consumer good;consumer goods;trade regime;liberal trade;engineering good;import duty;Trade Policies;industrialized country;positive correlation;Industrialized countries;Trade Policy;domestic production;welfare gains;scale economy;correlation coefficient;import substitution;significant correlation;export promotion;factor market;cyclical fluctuation;world trade;net impact;preferential scheme;estimation result;weighted average;longer period;trade strategy;quantitative restriction;factor endowment;primary goods;high capital;market size;differentiated products;rank order;trade preference;price deflator;trade flow;domestic supply;labor-intensive industry;individual products;real gdp;high ratio;high tariff;significant factor;graphical representation;debt crisis;intra-regional share;promotion effort;reveal preference;home market;regression estimation;capital good;demand pattern;trade datum;positive impact;product differentiation;product category;capital input;tariff cut;protection level;primary data;export drive;manufacturing export;interventionist policy;oil shock;resource base;dynamic efficiency;considerable difference;world income;higher growth;trade model;standard deviation;trade share;nondiscriminatory liberalization;negative correlation;manufacturing sector;asian countries;rank correlation;protected goods;export expansion;imperfect competition;industrial capacity;transportation facility;quality variety;trade volume;export performance;cyclical movement;international competitiveness;regression analysis;statistical table;

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Citation

Erzan, Refik

Would general trade liberalization in developing countries expand South-South trade? (English). Policy, Planning and Research Department working papers ; no. WPS 319 Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/650541468764981559/Would-general-trade-liberalization-in-developing-countries-expand-South-South-trade