Trade, growth: Weep not for Doha

The Economist’s Robert Guest once described the process of delivering beer from a port in Cameroon to the interior. A trip that was supposed to take three-quarters of a day took four days because the delivery truck was stopped 47 times at roadblocks, where tolls and other fees were extorted from the driver by police.

Trade increases when barriers fall. Tariffs are barriers, but so are corruption, administrative incompetence, superfluous paperwork, transportation monopolies and the use of antiquated technology.

Governments are becoming motivated to reduce these barriers because business, employment, investment and growth are all affected by the country’s approach to trade facilitation.

Multi-lateral agreements from the latest Doha talks on July 21 to reduce tariffs, subsidies and other barriers would be great for everybody. But even if the tottering Doha Round collapses for good, trade and growth can still rise sharply with the right unilateral reforms.

Ikenson is associate director of the Center for Trade Policy Studies at the Cato Institute and author of the new study “While Doha Sleeps: Securing Economic Gains through Trade Facilitation.”

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