Institutional Reform for Trade Liberalization

A significant number of developing countries are adopting more liberal trade and industrial policies. However, there is interest in how to phase-in and how to maintain the momentum of liberalization. Analysis at the World Bank stresses the need for the correct mix of macro-economic and trade policies if trade liberalization is to bring about the expected benefits. There has also been a considerable amount of work on the phasing-in of trade liberalization and the sequencing of trade and macro-economic reforms. In this context the recent proposals in the Uruguay Round by Australia, Canada, Hong Kong and New Zealand concerning domestic transparency in the formulation of national trade policies is of interest. Experience in some of these countries and in some developing countries gives us some useful insights on how such a mechanism might operate if it is to be effective in maintaining the momentum of liberalization and in seeing that the reform process is efficiently introduced.