Sustaining trade reform: Institutional lessons from Peru and Argentina
Elías A. Baracat, J. Michael Finger, Julio J. Nogués, Raúl León Thorne 28 October 2013
Trade reforms must be durable if countries are to reap the benefits of international specialisation and trade. Whereas Peru has sustained the reforms it carried out in the 1990s, Argentina has introduced multiple trade restrictions in recent years. This column argues that Peru’s success is due to two factors. First, Peruvian trade reform was part of a broader reform effort. Second, by highlighting the success of Asian countries and negotiating bilateral agreements, Peru’s political leaders fostered a positive vision of Peru’s role in the world economy.
Beyond removing restrictions, trade reform in Latin American in the 1980s and 1990s was also an attempt to reform the culture of policy management, and in some countries to introduce an optimistic, ‘Asian’ perspective into trade politics. In Peru, reforms have been sustained over several changes of president. In contrast, Argentina has introduced multiple restrictions and has reverted to the ‘off-the-books’ forms of policymaking that the adoption of GATT/WTO standards by previous the leadership tried to eliminate.
Institutions and economics International trade
WTO, trade liberalisation, Latin America, reform, Argentina, Peru
New roads to export: Insights from the Inca roads
Jerónimo Carballo, Christian Volpe Martincus, Ana Cusolito 13 July 2013
Expanding road infrastructure is often justified on the basis of its presumed effects on exports. Yet, available evidence on to what extent these effects really materialise is very limited due to difficulties faced in convincingly identifying true casual relationships. Historical road networks can help overcome this endogeneity challenge. This column provides evidence for Peru based on the Inca road network and suggests that improvements in road infrastructure have had a significant impact on firms’ exports and thereby on job creation.
In policy circles domestic transport infrastructure is seen as a key determinant of exports. More precisely, among policymakers, there is a well rooted idea according to which new roads can generate increased exports. Statements in official documents introducing public export plans of developed and developing countries alike are illustrative in this regard. The report presenting the US National Export Initiative 2011 is a clear example.
infrastructure, Export, Peru
Monetary policy in Latin America: Where are we going?
Christian Daude 10 December 2012
Latin American central banks are facing new challenges in the form of unprecedented levels of uncertainty and exchange rate appreciation pressures. This column, focusing on Brazil, Chile, Colombia, Peru and Mexico, argues that there is an overestimation of the potential output in several Latin American economies, a lack of an explicit policy direction from central banks, and lacklustre frameworks for macroprudential policy. Although inflation targeting has served countries in Latin America well, significant risks remain.
Inflation targeting has served countries in Latin America well . They have achieved macroeconomic stability by reducing inflation and the pass-through of external shocks such as oil price and exchange rate fluctuations (cf. Mishkin and Schmidt-Hebbel 2007).
Macroeconomic policy Monetary policy
inflation targeting, Latin America, Central Banks, foreign exchange, Brazil, Chile, Mexico, Colombia, Peru