Domestic Transparency and Trade Policy Making

in Developing CountriesHadi Soesastro

CSIS, Indonesia

Major weaknesses

• Lack of clear and precise national interests in trade policy

• Lack of transparency in trade policy making

• Lack of trade policy capacity

• Lack of negotiating capacity in international forums

These weaknesses are interrelated

Implications

• Ineffective in international forums

• Trade policy often driven externally

• Unable to accommodate domestic concerns

Trade policy is increasingly challenge at home

Some Illustrations

• Thailand’s FTA Policy under Thaksin“FTAs have been rushed, driven by fuzzy foreign-policy goals, and had very little sense of economic strategy” (R.Sally)

• ASEAN countries have poorly used ASEAN’s potential diplomatic and bargaining strength in their individual trade policy“There is still great resistance in ASEAN to formulate a coherent common external trade policy”

Trade policy making deficit

• Poor leadership• Misguided policies• Institutional defects• Top-down process• Lack of administrative capacity and

expertise• Lack of public knowledge and debateTrade policy is dominated by “insiders”

Democratizing the trade debate?

Incorporating the social dimension in trade and investment regimes

• To give social justice advocated a “seat at the table”?

• To ignore, accommodate or interact with People’s Forum/Summit/Assembly?Mercosur’s Economic and Social Consultative Forum; NAFTA’s “side agreements”; “advisory bodies” in the EU strcuture; a Civil Society Committee in FTAA; EPG’s recommendation for the ASEAN Charter

Other Tasks are Essential

Democratizing the trade debate only part of policy formulation process

• Tasks of trade policy management:- formulating clear, precise definition of national interests

in trade policy

- developing effective negotiating capacity

- ensuring effective domestic implementation of unilateral

measures and regional/international agreements

What to Do?

• Enhance transparency and improving public debateProducing credible, objective policy studies (Australia’s Trade Commission)

• Enhance inter-agency coordinationEffective interaction with non-border regulatory bodies (Hong Kong’s Coalition of Services Industries)

• Enhance negotiating capacityInvest competence in foreign ministries (Brazil, Chile, Australia); Strengthen WTO missions (Singapore)