ABSTRACT
The consequences of contemporary protectionism on underdeveloped economies is considered here. The chapter analyses the effects of the trend towards greater protection on the part of the advanced nations with the rise in Preferential Trade Agreements and Non-Tariff Barrier regimes. Facing widespread tariff barriers on labour-intensive manufactures and on primary products, the underdeveloped economies are experiencing reductions in their rates of economic growth and a rising developmental gap. Faced with trade deals that favour the advanced nations underdeveloped countries find themselves at a disadvantage due to the power relations that exist. Negotiators for the weaker party find that they must make concessions even if they then arrive at a sub-optimal outcome, on the basis that a deal is better than no deal. The overall result for the underdeveloped economies is an international trade environment that fails to produce mutually beneficial outcomes and indeed, perpetuates and exacerbates global inequality.
