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Trade Policy Reforms and the Structure of Protection in Vietnam

  • Prema-chandra Athukorala

This paper examines the current state of the trade policy regime in Vietnam against the backdrop of market-oriented policy reforms undertaken over the past one-and-a-half decades. The core of the paper is an in-depth analysis of the structure of protection, focusing on both incentives for import-competing production and the bias in the incentive structure against export production compared to import-competing production. It is found that, despite notable reform efforts, the structure of protection in Vietnam is still out of line with that of the major trading nations in the region, in terms of the level and the inter-industry dispersion of nominal and effective protection rates. There is a clear anti-export bias in the incentive structure, even though the degree of the bias has considerably declined over the years. There is no evidence to justify the existing protection structure on grounds of infant industry protection or employment generation. Copyright 2006 The Author Journal compilation 2006 Blackwell Publishing Ltd .

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Article provided by Wiley Blackwell in its journal World Economy.

Volume (Year): 29 (2006)
Issue (Month): 2 (02)
Pages: 161-187

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Handle: RePEc:bla:worlde:v:29:y:2006:i:2:p:161-187
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  1. Prema-chandra Athukorala & Hal Hill, 2010. "Asian trade: long-term patterns and key policy issues," Asian-Pacific Economic Literature, Asia Pacific School of Economics and Government, The Australian National University, vol. 24(2), pages 52-82, November.
  2. Hakkala, Katariina & Kokko , Ari, 2007. "The State And The Private Sector In Vietnam," EIJS Working Paper Series 236, The European Institute of Japanese Studies.
  3. David Greenaway & Chris Milner, 2003. "Effective Protection, Policy Appraisal and Trade Policy Reform," The World Economy, Wiley Blackwell, vol. 26(4), pages 441-456, 04.
  4. Arvind Panagariya, 1994. "East Asia and the New Regionalism in World Trade," The World Economy, Wiley Blackwell, vol. 17(6), pages 817-839, November.
  5. Prema-chandra Athukorala, 2008. "Export Performance in the Reform Era:Has India Regained the Lost Ground?," ASARC Working Papers 2008-03, The Australian National University, Australia South Asia Research Centre.
  6. Richard G. Harris & Peter E. Robertson & Melissa Wong, 2007. "Analyzing Economy Wide Effects of Trade Liberalisation on Vietnam using a Dynamic Computable General Equilibrium Model," Discussion Papers 2007-24, School of Economics, The University of New South Wales.
  7. Jones, Nicola & Nguyen, Ngoc Anh & Nguyen, Thu Hang, 2007. "Trade liberalisation and intra-household poverty in Vietnam: a q2 social impact analysis," MPRA Paper 4206, University Library of Munich, Germany.
  8. Hill, Hal, 2000. "Export Success Against the Odds: A Vietnamese Case Study," World Development, Elsevier, vol. 28(2), pages 283-300, February.
  9. Auffret, Phillipe, 2003. "Trade reform in Vietnam : opportunities with emerging challenges," Policy Research Working Paper Series 3076, The World Bank.
  10. James Riedel, 1993. "Vietnam: On the Trail of the Tigers," The World Economy, Wiley Blackwell, vol. 16(4), pages 401-422, 07.
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