By Lucy Ogalue
Prof Ha-Joon Chang of the University of Cambridge, said developing countries fared better under multilateral system than the bilateral.
Chang said this at the Africa Export-Import Bank(Afreximbank) Annual Meetings in Moscow, Russia on Thursday.
He said this in his presentation on “Building Pro-Developmental Multilateralism in an Era of Protectionism.”
The News Agency of Nigeria (NAN) reports that Multilateralism in international relations is an alliance of multiple countries pursuing a common goal.
While reiterating the benefits of Free Trade, Chang, however, added that free trade had its disadvantages.
According to him, free trade at different levels of development is bad for small countries because it affects their productivity and make them dependent on the rich countries.
He said all the rich countries have continued to be rich at the expense of the poorer ones.
Chang said the rich countries have had a developmental history of high tariffs and a widespread quantitative restrictions.
He said to make multilateral system pro-developmental on the continent, there should be a level playing field and the right principle where players had similar capabilities.
According to him, special and preferential treatment are important to ensure countries with different needs and capabilities are considered.
“We need to reform the current multilateral system based on the principle of asymmetric protectionism.
“Such that the economically weaker countries are allowed to protect and regulate more than the stronger countries can.
“And to gradually reduce the use of these extra policy measures as their economies develop over time and catch up with those of the richer countries.”
Also speaking, Prof. Eswar Prasad, Cornell University and Brookings Institution, said the basic requirements for Africa Trade expansion were education, improved infrastructure, and finance among others.
While speaking on the topic “On The Path for Africa’s Integration into the Blobal Economy”, Prasad listed the barriers to foreign capital to include underdeveloped financial markets and vulnerability to global shocks.
He said undisciplined macroeconomic policies, political instability and weak governance also hindered the continent for foreign capital.
The expert said the way forward was to redouble commitment to de facto trade integration and ensuring macro economic stability through right policy framework.
“Building credibility, improving institutional frameworks, governance, preparing for and managing risk is also important to ensure trade expansion.”
Meanwhile, Afreximbank in collaboration with the Roscongress Foundation and Russian Export Centre inaugurated a strategy for export trading companies at the sideline of the meeting. (NAN)