Trade Policy Reform in the East Asian Transition Economies

The performance of the East Asian
transition economies in export and income growth has been
strikingly better than that of countries in Eastern Europe
and the former Soviet Union. The East Asian economies have
achieved remarkably high growth rates in outputs and exports
without the often large declines in output and exports
observed in Eastern Europe and the former Soviet Union. East
Asian reformers have successfully made many of the parallel
changes needed in both domestic and trade policies to secure
export and income growth. (It makes no sense, for example,
to introduce the trade policy instruments of a market
economy when the domestic economy is still based on central
planning.) But there has been no single magic formula for
their success. The author discusses what each of the
economies (Cambodia, China, Lao People's Democratic
Republic, and Vietnam) has done. China experienced an
extended transition process; the transition ws much shorter
in other East Asian transition economies--especially
Cambodia. Several of the East Asian transition economies
used accession to a regional arrangement as part of their
reform strategy. China focused mainly on unilateral reforms
and, more recently, reforms associated with its accession to
the World Trade Organization. Most have made extensive use
of policies to attract foreign investment and to mitigate
the burden of protection on manufacturing exporters. Most of
the remaining trade policy problems, although difficult,
appear to be problems more of development than of transition.