India and the Credit Rating Agencies Jayati Ghosh

The recent downgrade of India as a sovereign borrower by the US-based Fitch has come close on the heels of similar downgrades and placing on “negative watch” by the other big two international credit rating agencies. In April, Standard and Poor’s had lowered India's rating outlook from “stable” to “negative”, and June it warned that India become the first “fallen angel” among the BRICS nations to get a sovereign credit rating below investment grade. These moves have created hysteria in much of the media and near panic in official circles. The domestic financial press, being more susceptible to external perceptions…

The Dalian Mini Ministerial and the Road to Hong Kong: Uncertain future for WTO Parthapratim Pal and Shravani Prakash

The forthcoming Hong Kong Ministerial meet of WTO is facing a problem. Slow progress of the Doha round of negotiations has led to a large number of unresolved issues in all key areas of negotiations. A recent informal meet of prominent WTO Members at Dalian, China did not manage to make much progress. This paper takes stock of the current round of negotiations and assesses the prospect of the Hong Kong Ministerial. Dalian_Mini_Ministerial (Download the full text in PDF format)

WTO and Agriculture: Once More with Vengeance C.P. Chandrasekhar

Developed country negotiators and officials at the World Trade Organisation, the powerbrokers in global trade, are striving hard to impose a limited "consensus" on members of the organisation. Holding out the threat of the breakdown of the multilateral trading system and the emergence of damaging bilateralism, they are seeking an agreement on the framework for the next round of global trade talks before a self-imposed "drop-dead deadline" of July 31. For the last few days WTO director general Supachai Panitchpakdi has been warning the organisation's 147 member countries that a "failure this month means the continuation of an unsatisfactory status…

Post Cancun Ministerial Negotiations on Agriculture: Latest Developments Parthapratim Pal

The failure of the Cancun Ministerial Meet has put brakes on the progress of negotiations on agriculture in World Trade Organization (WTO). Lack of consensus among key WTO members in the Ministerial did not allow WTO to endorse an official ‘modalities text' [1] on which Members could carry the negotiation forward. The impasse continued even after the Ministerial as WTO was forced to postpone a meeting on farm trade negotiations which was scheduled to take place on Oct 6-9, 2003. In a statement made in Geneva, Stuart Harbinson, Chairman, Committee on Agriculture (CoA) said: "in order to allow a period for reflection…

The Hypocrisy of Farm Subsidies

When Mexican corn farmers tramp through their fields behind donkey-drawn plows, they have one goal: to eke out a living. Increasingly, however, they find themselves saddled with mountains of unsold produce because farmers in Kansas and Nebraska sell their own corn in Mexico at prices well below those of the Mexicans. This is not primarily due to higher efficiency. The Americans' real advantage comes from huge taxpayer-provided subsidies that allow them to sell overseas at 20 percent below the actual cost of production. In other words, we subsidize our farmers so heavily that they can undersell poor competitors abroad. And…

Foreign Investment in Mexico after Economic Reform Jorge Máttar, Juan Carlos Moreno-Brid and Wilson Peres

The paper investigates why investments in post-reform Mexico have not recovered sufficiently from their 1981 collapse, to be able to ensure high levels of sustainable and steady economic growth over the nineties. This happened despite the fact that total gross fixed investment, GDP, and foreign direct investment grew vigorously in 1996–2000, but this impetus was cut short in 2001, thus revealing the inherent weakness of the system to sustain growth. foreign_investment (Download the full text in PDF format)

South African Finance Minister Admits he was Wrong

Finance minister Trevor Manuel advocated spending cuts, the dismantling of trade barriers and fighting inflation during the past six years, all under the guidance of World Bank economists. He is still waiting for the payoff. South Africa's economic growth has topped 4 percent only once since the mid-1990s. A third of the workforce is jobless. The government has faced a wave of strikes driven by anger at the slow gains in living standards since apartheid ended in 1994. Now, Manuel and even some World Bank officials say Africa's largest economy has not gained as expected from the lender's advice. Their…

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