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NEWS RELEASE 98-036; MAY 18, 1998
May 18, 1998
News Release 98-036
Inv. No. 332-372
ITC SYMPOSIUM RESULTS DEMONSTRATE
THE MAJOR IMPACT OF NONTARIFF BARRIERS ON APEC TRADE
Nontariff barriers (NTBs) have a major impact on trade involving Asia Pacific Economic
Cooperation (APEC) economies, and economic welfare gains from NTB liberalization would
likely far exceed those from removing tariffs, according to research presented at a U.S.
International Trade Commission (ITC) symposium and included in the resulting ITC report,
The Economic Implications of Liberalizing APEC Tariff and Nontariff Barriers to Trade.
The ITC, an independent, nonpartisan, factfinding federal agency, recently concluded the
study for the U.S. Trade Representative (USTR), who had asked the ITC to organize the
symposium. The symposium was held at the Commission on September 11 and 12, 1997,
following a public call for papers on relevant topics. Symposium participants represented a
broad spectrum of academic, research, and government institutions from a large number of
APEC members. The ITC's report includes a summary and assessment of principal results
of the symposium papers, the papers presented at the symposium, and critiques of those
papers written by experts in the respective fields. Highlights of the report follow.
- As requested by the USTR, the ITC's symposium included presentations of research
on trade-related aspects of various public and private policies and practices, as well as
on the general equilibrium modeling of trade policy.
- NTBs vary greatly in nature across issues such as intellectual property rights,
government procurement, investment, services, deregulation, and competition policy.
The symposium participants presented evidence indicating the relative importance of
the various barriers to APEC trade, including means for quantifying them.
- Symposium participants found that the nature and importance of NTBs depend directly
on government practices in many instances but depend more often on government
choices of how to enforce laws governing private markets. Even NTBs generated
largely by private practices raised significant public policy questions.
- Based on their research, several of the authors drew tentative policy conclusions on
particular issues. One of the most complex areas was domestic regulations governing
competition policy, where the approach of several researchers was to rank issues
according to the likely productivity of pursuing an international consensus.
- Recent general equilibrium modeling work has expanded on the measurement of
economic gains from liberalizing both tariff and nontariff barriers by including new
trade issues and new modeling techniques. The most general APEC liberalization
scenarios indicate potential static gains of around 1 percent of APEC gross domestic
- Trade issues more recently represented in general equilibrium trade models include
trade facilitation (for example, simplifying customs procedures), trade in services, and
deregulation. In many instances, the estimated economic welfare gains from
liberalization in these areas substantially exceed those from tariff elimination.
- Newer modeling techniques include dynamic models incorporating international
investment decisions. While comparisons between static and dynamic model results
can be difficult to make, dynamic gains from trade liberalization are likely several
times as large as the static gains.
The foregoing is from The Economic Implications of Liberalizing APEC Tariff and Nontariff
Barriers to Trade (Inv. No. 332-372, USITC publication 3101, April 1998).
The report will be posted on the ITC's Internet server at www.usitc.gov. A printed copy
may be requested by calling 202-205-1809 or by writing to the Office of the Secretary, U.S.
International Trade Commission, 500 E Street SW, Washington, DC 20436. Requests may
also be faxed to 202-205-2104.
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