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IR Working Paper 1990/5
Trevor Matthews and John Ravenhill, ‘Is Unilateral Trade Liberalisation the Answer?’, IR Working Paper 1990/5, Canberra: Department of International Relations, Research School of Pacific Studies, Australian National University, August 1990.
Australia and the Northeast Asian Ascendancy, the Garnaut Report, is an impressive overview of political and economic trends in Northeast Asia. But it is seriously flawed in its undertaking of the postwar liberal trading regime, in its treatment of industry policy, and in its disregard for the politics of trade liberalisation. This paper questions the validity of a number of the Report’s core economic assumptions, and raises doubts about the political feasibility of implementing some key policy recommendations. It addresses five main issues: the role of reciprocity in establishing and maintaining a liberal international trade regime the social and political costs of economic adjustment; the domestic political forces that sustain protectionism in Australia’s principal trading partners; the non-tariff barriers to trade in Northeast Asia and the variety of industry policies pursued by Australia’s competitors.