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Policies for the Poor

This interview is with L Alan Winters, one of the authors of Trade Liberalization and Poverty: A Handbook. This Handbook, published with the Department for International Development (DFID), examines how openness to trade is a key element of economic policy and how our concerns about the world's poor should affect our attitude towards and implementation of trade liberalization.

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Questions and Answers

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1. Is your backing for free trade as enthusiastic as one might expect? Who is right, protesters or economists? [James Morgan]
... Free trade is good for you…the handbook is realistic…but recognizes that pulling down trade barriers isn’t the only thing…invest in social, physical infrastructure ... [L. Alan Winters]

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2.  Do the LDCs have the capacity to liberalize and do those other things - provide the necessary physical and social infrastructure at the same time? [James Morgan]
Trade liberalization helps in all circumstances…best of combined with other policies...should be there anyway ... they become more relevant ... [L. Alan Winters]

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3. Trade liberalization makes winners and losers. But in the developing world the losers are especially hard hit [James Morgan]
... Liberalize sensibly, there won’t be many losers…but they can be helped...change crops…market better…better regulations, public services ... [L. Alan Winters]

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4. You emphasize the importance of agriculture but power is in the towns and they demand protection [James Morgan]
Poverty alleviation policies have to concentrate on the rural... spillovers ... poor spend 50-60% of income on food ... [L. Alan Winters]

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5. Anti-dumping causes the most anger. Are there no cases of unfair trade? [James Morgan]
... Maybe 3% of cases ...those can be dealt with by other methods ... danger not just US, EU ... LDCs may start and thus damage their own people ... [L. Alan Winters]

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6. Is it true that developing countries always lose on intellectual property protection? [James Morgan]
... Very small, very poor ones yes ... India, Brazil no ... but much work needed on who can gain ... [L. Alan Winters]

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7. In the developed world people feel they want to help those who suffer poor employment and environmental conditions. Is there not a case for standards? [James Morgan]
... Maybe, but have to be appropriate and adopted willingly ... dangers of partial coverage ... cannot be imposed by trade sanctions ... [L. Alan Winters]

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8.  You suggest that post-September 11 conditions could improve the chances of the proposed new trade round [James Morgan]
... Becoming clear that the world is a community ... cooperation the sensible way ... trade policy can help heal the wounds. [L. Alan Winters]

Trade Liberalization and Poverty: A Handbook - Report Details

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Trade liberalization is an important ally in the fight against poverty in the developing world. But how can policy-makers ensure that its impact on the poor is as beneficial as possible? A new Report explains how to think through the key issues - Read more in "European Economic Perspectives"
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