Consultations between different levels and branches of government A trade ministry should not confine its consultations to other agencies o...
Consultations between different levels and branches of government A trade ministry should not confine its consultations to other agencies of the executive branch at the national level. Depending on the constitutional arrangements within a country, it may also be necessary or advisable to extend those consultations to the legislative branch and/or to subnational units of government. This is an area where it is more difficult to make generalizations, given the diversity of political cultures, traditions, and constitutions. Much depends on whether a given country has a presidential or a parliamentary system, and on the extent of the authority that is exercised by smaller units of government. Coordination between the ministries of finance and trade is no less important today than it was in the past. Trade taxes, which may be collected as tariffs on imports and exports as well as consumption taxes on imports, still account for a relatively high share of total government revenue in numerous developing countries.
No matter what the precise level of fiscal dependence on trade taxes, it is imperative that trade policymakers work closely with budget planners in preparing for all negotiations that may lead to a reduction in tariffs. As things now stand in some developing countries, budget planners have no way of incorporating the projected results of trade negotiations in their plans, nor of providing useful guidance to trade negotiators regarding the budgetary consequences of making proposed deals. If the two ministries do not coordinate on these matters before and during a trade negotiation the fiscal consequences of a given tariff cut might have to be considered on a purely intuitive basis, and after the fact. Other ministries that might never have paid the slightest attention to trade must now be consulted. This point can be appreciated by considering the many ways that the interests and authorities of the ministry of health might now be affected by issues that are on the table in negotiations or might be raised in litigation. The country’s medical community is the natural constituency of this ministry. It is doubtful that most doctors, dentists, X-ray technicians, hospital administrators, and others who work in this field think of themselves as exporters of services, or that they consider their tasks to be in competition with foreign providers of these same services; it is equally doubtful that the officials in the ministry of health will think of the laws that they administer as being the subject matter of trade negotiations. And yet that is precisely what may happen if one of the country’s partners asks that it make a commitment on trade in medical services. The ministry of health will also have its own views on the consequences of extending stricter protection to patents on pharmaceuticals, the concessions that might be made on tariffs and regulations affecting the sale of alcohol and tobacco, and the “portability” of health insurance across borders. Even if these issues are not explicitly addressed in a trade agreement, it is also possible that they will arise later in a disputesettlement case. A coherent trade policy framework is needed because of the fact that, upon attaining political independence in 1975, [Papua New Guinea] inherited from the colonial administration a system of government that did not have such a framework … The lack of a vision and coherent trade policy has resulted in the development of ad hoc and often conflicting rules, regulations and practices affecting trade, and in an even greater disconnect between trade policy framework and other key economic (tariff, investment, industrial), sectoral (manufacturing, agricultural, forestry, fisheries, minerals) and social policy issues. Papua New Guinea Trade Policy Framework (2006) 58 TRADE POLICY FRAMEWORKS FOR DEVELOPING COUNTRIES: A MANUAL OF BEST PRACTICES It is nonetheless worth observing that countries in all quarters of the globe now find it necessary to consult more fully with other branches and levels than they did in the past. This is due not only to the changing subject matter of trade, but also to more fundamental shifts in governance. Democracy is more widespread in the WTO era than had been the case in the GATT period: 125 out of 195 countries (64.1 per cent ) were electoral democracies in 2015, up from 69 out of 167 (41.3 per cent ) in 1989.17 The spread of democracy is one of the most encouraging developments in recent history, but in some countries it poses new challenges for trade policymakers. National and even subnational legislatures are more involved today in the making of international economic policy, as are a bewildering array of participants in civil society. The end result is that the domestic diplomacy of trade policymaking can be just as challenging for a trade ministry as are its dealings with its foreign counterparts. Even some countries with long democratic traditions are only now extending greater authority to their legislative branches in matters of foreign policy in general or trade policy in particular. That is most clearly evident in the case of the European Parliament, which under the Lisbon Treaty is now more powerful vis à vis the European Commission than in the past. The Inter-Parliamentary Union urges that legislatures in other countries be equally active in their scrutiny of international economic negotiations. Any trade policy framework and strategy should emanate from the aspirations of the nation and the various stakeholders as to what kind of society and economy they want to create. Trade Policy Framework: Zambia (2016) Consultations also need to include subnational units of government in those countries where these institutions have jurisdiction over issues related to trade. This is an area where policymaking is often more complex in larger than in smaller countries, irrespective of their levels of economic development. Whether the units in question are called states (as in Brazil, India, Nigeria and the United States), provinces (as in Canada, China, and Turkey), or some other title (e.g. departments, länder, or cantons), subnational divisions may have either exclusive or shared jurisdiction over matters that have come to be incorporated within the expanded definition of trade policy. They can be especially active in the regulation of such services as banking, insurance, and education. Government procurement is another topic over which subnational governments may jealously seek to retain their autonomy, including the power to extend preferential treatment to local providers. These levels of government may also have limited authority in such topics as sanitary and phytosanitary measures, technical barriers to trade, and sales taxes. National governments are well advised to consult fully with their subnational counterparts on any topics that might require implementation at their level.
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