Discuss some of the key policy issues facing america. Discuss what you assess ar

Question

Discuss some of the key policy issues facing america. Discuss what you assess are the factors in their political systems, history, etc. impact the ability of these nations to address their policy challenges. and develop. Should we be optimistic about their prospects for success —why or why not? What recommendations would you make to the government, if you were called in as a consultant? It would be tempting to simply suggest that the governments and systems to fully pattern their policies after the US or another governmental system you may prefer, but why would that be unreasonable and difficult advice to follow.

Explanation / Answer

ANSWER:

Aid for trade comprises: technical assistance for capacity building and institutional reform, as well as financial support for diagnostic studies, investments in trade-related infrastructure, and assistance to offset adjustment costs, such as support to help countries make the transition from tariff to other source of revenue. The significant trade liberalization undertaken by developing world over the past two decades has been associated with rapid growth in a number of formerly poor countries, especially in Asia. Countries with export-oriented policies have grown faster than those with inward-oriented policies that block integration and discourage competition. The increase in per capita incomes in these countries has been accompanied by a – sometimes dramatic decline in the incidence property.

Efforts to provide aid for trade, like any other aid, need to take account countries’ absorptive constraints, whether at the project implementation, institutional or macroeconomic level. Nevertheless, it is useful to note that both trade reforms and aid for trade can also be complementary to the broader growth in aid: trade reforms and aid for trade can play a role in managing scaled-up in flows, by encouraging aid absorption and containing or mitigating the consequences of upward pressure on real exchange rates. For instance, more open trade policies can counteract the negative impact that surges in aids, which can raise real exchange rates, might have on the competitiveness of exports. Lower import tariffs reduce costs for the export sector, both directly by making imported inputs available more cheaply and by diverting fewer resources into import competition and learning. Aid for trade in turn can tackle bottlenecks hampering supply and productivity in the non-tradable sector –such as roads, storage, ports, distribution-enabling the sector to expand supply instead of increasing prices, and thus benefiting the competitiveness of tradable sectors. Finally customs reform and trade facilitation more generally, can reduce transaction costs for trade, thus countering the effects of real exchange rate appreciation.

At the request of the Government of Mauritius, Bank and Fund staff provided in-depth analytical and technical assistance support in identifying key elements of a reform program. The IMF has advised on budgetary measures that will be central in the restructuring process, while strengthening the social safety net. The World Bank has focused on how Mauritius might improve its trade competitiveness, through a combination of tariff reduction and simplification, tax and regulatory reforms to encourage investment and to tap new sources of future growth, while protecting low-income workers during transition process and providing new opportunities for the unemployed. Moreover, an IMF-sponsored consultant is also assisting the authorities in monetary and financial sector policy formulation. Bank and Fund staffs have been working with Mauritius to identify prospects for possible donor funding associated with the aid for trade initiative.
Going forward, the authorities are seeking an IMF/World Bank assessment of their reform strategy to help to mobilize financial support in the context of donor commitments on aid for trade. Mauritius plans to showcase its economic reform program on margins of the Annual Meetings in Singapore. The government has asked the World Bank, in the context of aid for trade, to provide financing and technical assistance through series of programmatic loans and selected infrastructure projects. Potential benefits of regional cooperation can be large, particularly for small, very poor, and land locked countries. To trade, countries need to be competitive and cross-border infrastructure and policy cooperation (harmonization, mutual recognition, adoption of common regulatory systems) can help lower trade costs. Landlocked countries of which they are over 20 amongst the low income countries-can be dependent on action by neighbors to ensure their access to trade and transport links. The establishment of a transport corridor linking two or more countries can be a mechanism that reduces trade costs both directly and indirectly by increasing the incentives of all countries involved to monitor “performance” on the corridor. Non tariff barriers are a major impediment confronting traders in low-income developing countries-red tape, corruption, internal tax and regulatory controls. These are matters that may be difficult for national governments to address – international cooperation can help focus political attention on these problems.

We have seen and discussed the theories of international relations, and critically examined the various development agenda; and reviewed the existing discourse on globalization and its impact to the global development.

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