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Consultations with the private sector

  Consultations with the private sector The private sector is the ultimate beneficiary of trade policy, and should be involved as much as po...


Consultations with the private sector The private sector is the ultimate beneficiary of trade policy, and should be involved as much as possible in its development and execution. Businesses are often the most important source of information on other countries’ trade barriers, apparent violations of trade agreements, and related matters. The importance of consultations is easily acknowledged but not so easily executed. While many countries have some type of public–private consultative arrangement in place, relatively few function as well as they ought. Officials in the public and private sectors of developing countries often have parallel complaints regarding the conduct of consultations. Whereas representatives of the business community may criticize a government for consulting with them only sporadically, and doing so only when a policy is in the final stages of development or adoption, government officials may be equally unhappy with the input that they receive from the private sector. Comments may come too late, or not at all, and business representatives may raise their objections only after a policy has been implemented. Dialogue between government and civil society should ideally be comprehensive, with the public sector being both informed by and giving actionable information to firms, industry associations, labour unions, and other interested parties. Producers, workers, exporters, and actual or potential investors need to know about any anticipated changes in the trading environment that might affect their opportunities or decisions. These include not only those steps that the government plans to take (e.g. the negotiation of a new agreement), but also information that the government obtains on the plans of other countries (e.g. if a certain programme or policy in a partner country is expected to change). Similarly, it is incumbent upon the business community to keep the government informed of any developments that should be taken into account in trade negotiations or other initiatives. For example, businesses should be encouraged to inform the government of any existing or anticipated barriers to foreign markets. V. TRADE POLICYMAKING INSTITUTIONS 59 Representatives of the private sector may also be included in delegations to international meetings. This is a common practice in some countries, and ensures that policymakers have the benefit of on-thespot information and advice. Many trade negotiations now include “parallel” events to which representatives of civil society are invited, ranging from trade fairs to seminars. While it is important to foster consultation and collaboration between the public and private sectors, it is equally important to ensure that government does not respond only to the most influential interests. There is a distinct danger that the most organized and connected groups in civil society might “capture” government agencies, such that it is not the agencies that regulate industry but vice versa. In the field of trade policy, capture may manifest itself in unbalanced representation that favours protection over consumer interests. While it is economically rational for small numbers of producers to band together in support of continued protection, there is little incentive for large masses of consumers to organize in counterpoise to the protectionists. Skewed representation of interests can result in equally skewed policies. These observations point to the need to include a wide range of civil society groups in consultations. In addition to groups that represent industries, exporters, and importers, a government should ensure that it gives adequate voice to the interests of consumers, service sectors (including the creative community), and others whose interests were often overlooked when trade debates were limited to issues involving the cross-border movement of goods

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