ABSTRACT
Trade policy reform, because of its economy-wide effects on relative prices and efficiency, has often been a key component of the first phase of adjustment. Such reforms, when implemented well, have contributed to improved economic performance in developing countries. Nonetheless, both the implementation and outcomes of reforms have been less successful than might have been hoped for, given their prominence in adjustment policies and World Bank lending. There remains substantial room for improvement. Through the insights provided by economic theory and the experience of many developing countries that have attempted to implement reforms, a number of lessons can be derived to improve implementation and performance.
