International Economic Problems by Leonard Gomes (auth.)

By Leonard Gomes (auth.)

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The same cascaded effect, to a lesser or greater degree, is apparent on the processing of a wide range of industrial supplies and raw materials. This means, as we have seen, that effective rates of tariff protection on finished products substantially exceed the nominal rates. , for instance, effective rates exceed nominal rates by 30 per cent on average. 3 Industrial Tariff Profiles in Selected Major Industrial Countries Industrial supplies United States Japan E. E. C. Source: 1974. formation, Ministry of International Trade and Industry, Japan, Tariff rates are weighted averages of those on individual commodities within each commodity group in effect as of 1 January 1972.

The effective rate of subsidy (ERS) = vd; vw_loo w =[(Vw+:,)-Vw]_lOO=:. 100 w w Estimates of effective rates of subsidy to different industries can then be used to (a) detect cases of excessive subsidisation, (b) equalise the incentive provided to the export sector with tariff protection afforded to import replacement activities. S. National Bureau of Economic Research (NBER) on exchange control, liberalisation and economic development2 over the last few years, and the ongoing research on export-promotion policies of a number of developing countries by the World Bank indicate potential benefits from an export-oriented development strategy.

Market. However one cares to regard it, the application of this formula is so restrictive that little expansion of preferential trade is likely. In addition to these basic features which restrict the trade creation effect of the GSP, the schemes are further circumscribed by strict rules of origin and the exclusion of some important suppliers from the list of beneficiary countries. The rules of origin exclude from preferential treatment clothing manufactured from imported textiles or radios assembled using imported transistors.

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