L20Nov09.306

L20Nov09.306 - Lec 21 State Trading Enterprises in...

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Lec 21: State Trading Enterprises in Agriculture FRE 306
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Lec 20: State Trading Enterprises in Agriculture 2 State Trading Enterprises (STEs) Agency or enterprise that is publicly/government owned or legislated and has some trading rights Often has some import or export monopoly rights Many examples in most countries Canada: Canadian Wheat Board: wheat and barley exports Canadian Dairy Commission: dairy product trade China COFCO: most food imports Indonesia: BULOG: rice trade monopoly Vietnam: Agency with rice export monopoly (private/public)
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Lec 20: State Trading Enterprises in Agriculture 3 State Trading Enterprises II Why the concern in international trading circles with these entities? If they have export monopoly or import monopsony powers, does that not affect only the domestic economy, and have no effect on the world market? Worries that these enterprises allow countries to evade their trade agreement commitments on export and import practices On exports: can STEs effectively subsidize exports but in a hidden fashion? On imports: can STEs indirectly impose import trade barriers, effectively adding tariffs to imports that run counter to commitments made in trade agreements?
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Lec 20: State Trading Enterprises in Agriculture 4 State Trading Enterprises III In principle, these institutions could engage in activities that mimic export subsidies or import restrictions However, in summarizing empirical research in this area, it is clear one must examine these STEs carefully and individually in order to conclude what role they play or can play and what effects they have on trade It depends on the specific operating details or
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This note was uploaded on 03/09/2010 for the course LFS FRE 306 taught by Professor Barichello during the Winter '09 term at UBC.

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L20Nov09.306 - Lec 21 State Trading Enterprises in...

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