Government-Led Export Promotion in Light of Distributional Fairness in the Global Trading System Jai S. Mah JOURNAL OF ECONOMIC ISSUES Vol. XLIV No. 4 December 2010 DOI 10.2753/JEI0021-3624440402 Presented by Kyaw Sein Win (2015535064)

Purpose Seeking more benefits for Developing Countries(DCs) in the Global Trading System emphasizing on export promotion of manufactured products of DCs Motivation The importance of Gov’t-led export promotion in rapid economic growth The ways for economic development of DCs through promoting manufactured export of them

Why is the Topic important? Rapidly growing economies pursued government-led export promotion and benefited from subsidization policy Under the current WTO system, there are strict restrictions or even prohibition on the DCs’ use of export promotion policies

Why is the Topic important? (Con’t) Huge gap between the economic development level of developed countries and that of DCs continues and appears to have become even wider Need to promote manufactured exports of DCs in light of “distributional fairness” in international trade relations

Research Objective To examine the fairness of the current WTO system particularly regulations on the use of export promotion policies To provide suggestions on modifying current WTO regulations in favor of the export promotion policies of developing countries (Especially Uruguay Round Subsidies Code) To suggest ways of promoting manufactured exports of DCs under the current WTO system.

Research Questions Does the current WTO system provide fair regulations on the use of export promotion policies regardless of different economic development levels? How to develop production capacities and exports of manufactured products of DCs? How to modify the current WTO regulations in favor of the export promotion policies of DCs?

Previous Studies Prebisch, Myrdal, and Singer, Ho (2008) emphasized promotion of manufactured exports from the viewpoint of economic development of DCs Despite special treatment of DCs in the current WTO regulations, many feel that they codify existing rules or practices created in developed countries (Wolfe 2004)

Previous Studies (Con’t) Developed countries actively utilize export promotion measures - R&D policy measures, education programs, and export credit schemes (Weiss 2005) One may doubt the “fairness” of the current WTO system that regulates the use of export promotion policies regardless of different economic development levels

Focus of the Research It focused on Export-led Economic Development of DCs Promotion of Manufactured Export of DCs under the current WTO system Modification of current WTO regulations on export promotion

Contribution A few works compared the regulations on industrial policies between General Agreement on Tariffs and Trade (GATT) and the current WTO system Amsden (2000) discussed prohibition on export subsidies, major difference between GATT and WTO But focus on the aspect of science and technology

Contribution (Con’t) Chang (2005) emphasizes on shrinking policy space with respect to tariff policy from a historical perspective, but he does not cover export promotion policies DiCaprio and Gallagher (2006) examine the industrial policies implemented by the newly industrializing countries during the GATT regime They explain the provisions in the GATT and WTO relating to industrial policies in general

Contribution (Con’t) But, this paper focuses on Export Promotion Policies (Government-led export promotion) By emphasizing on promotion of manufactured export of DCs under the current WTO system Analyzing the way to modify current WTO regulations in view of Distributional Fairness in international trade relations

Structure Descriptive explanation on export promotion measures prohibited and permitted to DCs in the WTO regulations Explaining Regulations on Export Promotion Policies and Fairness in International Trade Brief explanation about Special and Differential Treatment and Distributional Fairness

Structure (Con’t) Explaining Ways of Export Promotion Under the Current WTO Regulations Suggestion on Modification of the WTO regulations especially Uruguay Round (UR) Subsidies Code Finally, researcher concluded the paper providing viewpoint of “distributional fairness” to justify special treatment of DCs