DISCUSSION PAPER N°5

The Global Textile and Clothing Industry post the Agreement on Textiles and Clothing

This paper, written under the exclusive responsibility of a staff member of the WTO Secretariat in a personal capacity, assesses some of the possibilities with respect to the potential impact of trade liberalization in the textiles and clothing sector with the end of import quotas on 1 January 2005.

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The paper reproduces simulation estimates of the effects on trade flows of quota removal, using standard general equilibrium modelling techniques. It then argues that the estimates thus derived tend to ignore certain industry characteristics and policy factors. The paper does not purport to reflect a comprehensive list of such factors. The paper ends by offering an alternative estimation technique. The fluidity of the commercial and policy environments affecting trade in this sector, and the consequent difficulty in assessing the impact of trade liberalization, should be borne in mind when reading this paper.

Published in 2004

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