Impact of Selectivity and Neutrality of trade Policy Incentives on Industrialization of Developing Countries; Implications for NAMA Negotiations

Abstract This author sheds some light on the theoretical arguments on the use of selectivity and uniformity of trade policy in trade and industrialization for targeting industries and firms and provides a brief historical review of practices of developed countries and East Asian countries with particular reference to Republic of Korea. Furthermore, he provides empirical evidence on the impact of non-neutral tariff rates for a sample of 32 developing countries for the period 1980-87 - before important changes towards neutrality of tariff structure of developing countries took place. Further, he outlines preconditions for implementing “selective” (targeted) trade and industrial policies. Yet more, he discusses the implications of the findings of the study for the dynamism of the tariff structure of developing countries, thus for negotiation for NAMA (Non-agricultural market access) in WTO and outlines necessary changes in WTO rule to make them conducive to the interest of developing countries.