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Published byRodney Reed Modified over 9 years ago
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Role of Effective Policy Management in Sustainable Economic Integration K. T. Chacko Director / Vice-Chancellor Indian Institute of Foreign Trade New Delhi (India)
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2 Economic Integration maximizes global efficiency. efficiency. GATT / WTO MTNs deepened integration process. process. Emergence of RTAs / PTAs / CECAs. Selective liberalization reduces injury to vulnerable sectors. vulnerable sectors. Enhancing Economic Integration
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3 Burdens & Benefits of Integration may be asymmetrical. asymmetrical. How to Share it equitably. Weak institutional and enforcement set – up pose challenges. up pose challenges. Economic Integration - Issues
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4 Economic Integration process got a jolt with Global Economic Crisis. Global Economic Crisis. Reducing the adverse impacts of crisis also depended on how Domestic and External Policy depended on how Domestic and External Policy Management was undertaken. Management was undertaken. Countries adopted different Policies to boost demand confronted with contraction of global demand confronted with contraction of global demand. demand. Impact of Liquidity shortage sought to be reduced through Trade Finance Measures. through Trade Finance Measures. Response to Global Economic Crisis
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5 Monetary Policy played a crucial role, post crisis. Managing volatile capital flows proved important. Semi – open emerging economies and their partially open capital account and its correlation partially open capital account and its correlation with impact of crisis. with impact of crisis. Pre-mature opening hurts. Need more research on the type of controls needed. needed. Macro Economic Policies
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6 Huge opportunities exist. Efficient Domestic Policy Management crucial for integration. Eg. Health Services crucial for integration. Eg. Health Services Services Trade Integration
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7 Economic Integration and the need for SDT for Developing Countries Economic Integration and the need for SDT for Developing Countries Distortions in Agriculture Trade impacting Developing Countries adversely. Countries adversely. State support for technology improvement, etc. vital. Developing Countries need labour absorbing technologies - Scope for South-South Cooperation. External Policy induced distortions also need correction through domestic action. through domestic action.
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8 Need to factor variables other than “efficient allocation of resources”, also. allocation of resources”, also. -Diversification of production, structural transformation, correction of Govt. & Market failures. Understand the forces underlying Growth. -Technology catch – up. -Encourage Risk – taking. State’s role in selective interventions. Growth
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9 To Maximize Benefits of Economic Integration To Maximize Benefits of Economic Integration Manage macro economic policies efficiently. Build Institutions for efficient management. Different tool sets required depending on the degree of openness. degree of openness.
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