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GTAP Resource #1851

"Could Unrestricted Market Access to the QUAD Markets make the Doha Round useful for SSA After taking Account of AGOA and EBA?"
by Karingi, Stephen, Hakim Ben Hammouda and Romain Perez

A great deal of attention has been given to the integration of sub-Saharan African countries into the international trading system over the past five years. The QUAD countries (United States, Canada, the European Union, and Japan) have strongly reinforced their preferential trade agreements in favour of least developed countries (LDCs) from Africa and elsewhere, with specific initiatives from the EU and the US, and large extensions of the existing preference schemes by Japan and Canada. Yet, despite sharp reductions in the tariffs on African exports towards these markets, African exporters still face tariff barriers that are significant for key products. This study estimates the gains that sub-Saharan African countries could draw from genuine unrestricted market access (UMA) and also discusses the institutional framework in which UMA should be implemented. The analysis shows that, despite recent improvements in the preferences granted to African states, welfare gains associated to UMA would amount to USD 1.2 billion in sub-Saharan Africa, favouring primarily unskilled workers. This paper highlights the limited costs that UMA would imply for the QUAD countries, as well as the indirect benefits developing countries would realize due to the trade shifting induced by UMA and the economic gains in sub-Saharan Africa. The analysis is extended to investigate the potential impacts of a Most Favoured Nations liberalisation likely to result from the current Doha Round. The results show that the current Doha Round could erode the benefits of UMA, as the MFN tariffs are likely to decrease substantially after its implementation. But on the other hand, the analysis in this paper also quantifies the potential impact of reciprocity in a multilateral framework. The results show that asymmetrical reciprocity could leave the UMA benefits nearly unchanged but this asymmetry would have to leave at least 40 percent of sub-Saharan Africa trade for QUAD imports free of tariff reduction.

Resource Details (Export Citation) GTAP Keywords
Category: GTAP Application
Status: Not published
Date: 2005
Created: Karingi, S. (6/16/2005)
Updated: Dimaranan, B. (6/30/2005)
Visits: 2,296
No keywords have been specified.

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