INTERNATIONAL TRADE POLICY

International Trade Policy

International Trade Policy

Much of the literature on developing countries in the General Agreement on Tariffs and Trade (GATT) argues that developing countries' behaviour in the GATT was driven by a commitment to import substitution and a demand for special and differential treatment (SDT). The precepts of import substitution are seen as having underpinned a desire by developing countries to evade commitments to tariff reductions and a refusal to engage in reciprocal tariff bargaining. Furthermore, due to their “misguided” focus on import substitution developing countries are generally seen as having opted not to participate in the GATT, demanding instead SDT provisions to escape GATT obligations.

Elsewhere, with Dilip K. Das, I have shown that this characterisation of developing countries' actions in the GATT does not do justice to the extent to which developing countries participated in the GATT's activities (Dilip K. Das, 2001, p. 27). In the present paper, the focus is on examining the critical period around the ultimately doomed negotiation of the Charter for an International Trade Organisation (ITO) and the process of creating the GATT.

Dilip K. Das argues in his book that while a concern with maintaining the freedom to protect infant industries was clearly an important consideration underpinning developing countries' attitudes to the Charter and GATT, it was only one aspect of a more complex set of aims and ideas. In seeking to understand the views of the developing world with regard to the ITO and GATT, we do them a disservice in reducing those ideas to a “relentless but misguided pursuit of […] import substitution” (Dilip K. Das, 2001, p. 27). While it is clearly true that the desire of developing countries to maintain a degree of freedom in commercial policy to allow the introduction of protection for infant industries was an important concern in determining their position with regard to the Charter and GATT, other ideas were also important. By forgetting these other factors we can be led to characterise inaccurately the interaction between developing countries and the GATT.

All too often the ideas that are taken to have lain behind the attitudes developing countries took to the ITO and GATT negotiations are characterised as being simply import substitution and a demand for SDT, leading them to demand no restrictions on their trade policy and to opt out of the GATT. Certainly, import substitution and SDT were features of the beliefs and requests made by less developed countries, but there was a great deal more behind the attitudes they took to the negotiations. This book has examined some of these, taking as a departing point the dual contention that to understand a country's behaviour and views it is necessary to understand the ideas that lie behind them, and that nothing contributes more to those views than their previous experiences. For developing countries, the most important experience underlying their attitudes in the GATT negotiations was that of colonialism and the control of their commercial policies that colonialism ...