ABSTRACT

This chapter explains about trade as an alternative to aid. It traces the process of trade liberalisation, and in particular the Uruguay Round and its aftermath; assesses the potential benefits from freer trade for development prospects; and reviews the need for developing countries to promote more openness in their economies to take full advantage of trade liberalisation. Trade liberalisation is returning and history can be a guide to the future. The Round has been by far the longest and most comprehensive of all, finally establishing a basis for universal and equitable trade liberalisation under the supervision of a new international agency, the World Trade Organisation. Developing countries participating in the agreement have mostly only agreed to limited market access, but have a lot to gain from liberalisation. The Uruguay Round has led to a widespread liberalisation of trade in products and services, and laid down a definitive framework for a continuation of the process.