Financial Times FT.com

Why free trade has costs for developing countries

By Robert Hunter-Wade

Published: August 11 2005 03:00 | Last updated: August 11 2005 03:00

Before and after the Live8 concerts and the Group of Eight summit in Gleneagles, we heard much about how the west can help Africa: debt write-downs, aid and trade liberalisation.

Debt write-down and aid apply mainly to Africa; but trade liberalisation applies to the entire developing world. Western development organisations such as the World Bank say that trade liberalisation is not just a vital condition of development, it is a powerful propulsive force. The bank noted in a recent report that a reduction in trade barriers "could accelerate growth, provide stimulus to new forms of productivity-enhancing specialisation and lead to a more rapid pace of job creation and poverty reduction around the world".

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