Poverty Impact Analysis: Approaches and Methods - Chapter 7 pot

PART TWO

Applications of the CGE

Modeling Framework for

Poverty Impact Analysis

CHAPTER 7

Computable General Equilibrium Model:

Can the Poor in Indonesia Benefi t from

Trade Liberalization?

Guntur Sugiyarto and Douglas H. Brooks

Introduction

The latest and ongoing round of trade negotiations under the World Trade

Organization (WTO) has become commonly referred to as the Doha

Development Agenda (DDA). It was set out in the WTO’s Doha Ministerial

Declaration in November 2001. Earlier trade negotiation rounds took

place under the auspices of the General Agreement on Tariffs and Trade

(GATT) but, since 1 January 1995, the WTO has been mandated to discuss

international trade issues, including multilateral negotiations to create an

open trade environment (Table 7.1). The WTO advocates global free trade to

raise standards of living and promote greater employment with a large and

steadily growing volume of real income and effective demand.1

The Doha round of WTO negotiations was scheduled to be completed

by the end of 2004. When it started in November 2001, members gave

1 WTO is an international trade organization complementing the Bretton Woods institutions

of the International Monetary Fund (IMF) and World Bank that were started just after

World War II. The 23 founding members of the GATT have expanded into the current

151 members of the WTO.

Table 7.1 Trade Negotiation Rounds

Year Place/Name Main Subjects Countries

1947 Geneva Tariffs 23

1949 Annecy Tariffs 13

1951 Torquay Tariffs 38

1956 Geneva Tariffs 26

1960–1961 Dillon Round Tariffs 26

1964–1967 Kennedy Round Tariffs and antidumping measures 62

1973–1979 Tokyo Round Tariffs, nontariff measures “framework” agreement 102

1986–1994 Uruguay Round Tariffs, nontariff measures, rules, services, intellectual property,

dispute settlement, textiles, agriculture, creation of WTO, etc.

123

2001–present Doha Development Agenda Agriculture and services 148

Source: Authors’ summary.