External Tariff Liberalization in CARICOM: A Commodity-Level Analysis

February 1, 2008

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Azim M Sadikov. External Tariff Liberalization in CARICOM: A Commodity-Level Analysis, (USA: International Monetary Fund, 2008) accessed November 21, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

This paper estimates the impact of the tariff liberalization in four largest CARICOM countries (Barbados, Guyana, Jamaica, and Trinidad and Tobago) on their trade flows. I trace changes in the product-line imports from CARICOM and non-CARICOM countries against time and commodity-level variation in external tariffs. I find that in each country the reduction of the external tariff, which eroded preferences enjoyed by member imports, increased the ratio of imports from non-member countries to imports from member countries. In Trinidad and Tobago, the higher ratio was largely the result of non-member imports crowding out member imports. In the three other countries, the ratio increased mainly because of higher non-member imports; there is little evidence that tariff reductions had an impact on member imports. Findings suggest that in Trinidad and Tobago liberalization of the external tariff reversed some of the trade diversion effects of CARICOM.

Subject: Commodities, Imports, Tariffs, Trade liberalization, Valuation, origin and classification

Keywords: CARICOM country, Commodity import, Imports from CARICOM, Non-member imports, WP

Publication Details

Pages:

33
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2008/033
Stock No:

WPIEA2008033
ISBN:

9781451868951
ISSN:

1018-5941

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