This article examines the basic economic background of the seven South Asian countries (Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan and India), their growth in imports intra-SAARC, direction and composition of trade in South Asia, and the relative importance of the South Asian trade in the global trade. The trends and patterns of growth in exports and imports in South Asia over the period 1991 to 2005 have been discussed in this article along with trends in intraregional trade. Developed industrial economies are also important suppliers of imports to South Asia and noticeable proportion of imports to the region are sourced from the Middle East.

Federation was the beginning of a new era of the Australian trade policy with the introduction of free trade between states and the adoption of a common external tariff against imports. During the early years under the new Commonwealth government, revenue raising was the prime purpose of import dudes and protection to domestic industries was a secondary issue. The 1908 Lyne tariff was the first significant step towards a protectionist Australian tariff since federation. The second and more important tariff increase was the 1921 Green tariff when the Commonwealth decided to provide protection to industries which emerged during World War I. The establishment of the Tariff Board was another important policy decision of the year. There were number of tariff increases during the 1920s on the advice of the Tariff Board. While manufacturers were receiving protection, there was a growing dissatisfaction among the primary producers because they believed that the higher costs imposed on the Australian economy by tariffs were finally borne out by the farming sector. The policy of protection in Australia in the 1930s was to ensure that a significant change in income distribution would occur in favour of wage earners. However, the attitude toward such need has gradually diminished over last three decades. Hence it may be questioned whether the strong historical public support for protectionism in Australia distracted policy makers' attention from more efficient trade policy alternatives (Anderson and Garnaut, 1987, p.31). The purpose of this paper is to provide a quantitative assessment of this trade policy debate of the 1930s Australia. This is achieved by comparing the impact of a tax on wool exports with that of a uniform increase in tariffs on imports. We use a computable general equilibrium (CGE) model of the Australian economy in the 1930s Australia to derive the empirical results. A computable general equilibrium (CGE) model of the Australian economy in the 1930s is used to analyse the effects of protection to manufacturing and the impact of a tax on wool exports at macroeconomic and sectoral levels. The results lend support to the proposition that the policy of protection would have resulted in a higher national income and welfare for the inter-war Australian economy. This is the effect of improved terms of trade due to tariffs and the wage earners seemed to have benefited from that trade policy. The findings however reject the hypothesis that a tax on wool exports would have been a better substitute for a uniform tariff on all imports.

Australia's trade with India and South Africa has been growing steadily in recent times. These countries have become more liberalized in trade during the last five years and they also play a significant role in the Indian Ocean Rim-Association for Regional Cooperation (IOR-ARC). It has been proposed that Australia should take the initiative informing effective cooperation with India and South Africa for complete free trade. This paper examines the trade links between these three countries and then evaluates quantitatively the likely effects of the establishment of a bilateral Free Trade Agreement (FTA) between them. GTAP (Global Trade Analysis Project) model has been used to quantify the effects of the FTA. The results provide some indication of the magnitude of the welfare gains involved under free trade and shed some light on prospects for trade liberalization in IOR countries.

Contracting parties to the Agreement on South Asian Free Trade Area (SAFTA) are committed to trade liberalization within a fixed time frame. Most contracting parties have kept agriculture out of their tariff liberalization commitments. A key question therefore is: should agriculture receive dispensation given the sector's important contribution to South Asia's economic structure? An enhanced multi-household framework within a multi-country computable general equilibrium (CGE) approach was used to assess the impacts on trade flows, government fiscal revenues and income distribution among households in countries that are contracting parties to SAFTA, assuming full trade liberalization and trade liberalization with the protection of the agricultural sector. The results indicate that, although both policies would facilitate economic growth and lead to a reduction in income disparity among household groups in all South Asian countries, the overall welfare gains would be greater under full trade liberalization. Hence, the removal of agricultural sector tariffs should be an important consideration in future SAFTA discussions; such a step would be a principal means for strengthening intraregional trade.

South Asia consists of seven economies (India, Sri Lanka, Pakistan, Bangladesh, the Maldives, Nepal and Bhutan) that have been recognised as the South Asian Association for Regional Cooperation (SAARC) in terms of their attempt to enhance trade and investment. Australia has been given the observer status in SAARC. Australia has experienced a significant growth in trade with South Asia in recent years. For example, India has become the 4th largest export destination for Australia in 2009. An FTA between Australia and SAARC countries would enable both Australia and South Asia to strengthen further this trade and to benefit by taking full advantage of each other's relative competitive strength. This can be achieved by removing barriers to trade and investment on a bilateral basis which impose additional costs to producers and consumers. In this paper we analyse the prospects for forming an FTA between Australia and SAARC countries. We use the Global Trade Analysis Project (GTAP) model to evaluate benefits and costs for both parties of an FTA. While the analysis mainly focuses on macroeconomic and sectoral performance under an FTA, it also highlights the potential welfare gains, trade creation and trade diversion issues that are important to policy makers.

This paper uses a computable general equilibrium (CGE) model to investigate the impact on poverty of trade liberalisation in Bangladesh. The simulation results show that the complete removal of tariffs favours export oriented sectors in the economy. With trade liberalisation, rural and urban areas experience an overall reduction in poverty in the short run. However, a marginal increase in the poverty gap and poverty severity for urban areas is projected, implying that the poor become poorer in urban areas. Moreover, poverty incidences vary among various socio-economic groups. In the short run, poverty incidence increases for rural landless and urban illiterate and low-educated household groups. In contrast, the long run results highlight that trade liberalisation reduces absolute poverty for all groups both in rural and urban areas.

Mega events such as the World Financial Crisis in 2008 have tremendous negative economic effects, particularly on tourism. This study employs recent Singaporean tourism survey data, the updated Singaporean input-output tables, and a Computable General Equilibrium (CGE) model to gauge the negative effects of the 2008 World Financial Crisis on Singapore and to simulate the effects of selected policy responses. The CGE simulation results demonstrate that at the macro level, although almost all variables are negatively affected, exports benefit greatly. At the industry level, a negative tourism shock impacts severely on the tourism-related sectors, impacts only slightly on sectors weakly linked to tourism, but tourism-competing sectors expand. In commodity market, prices and outputs decrease for most products but real household consumption and exports increase. In the labor market, low skilled workers are harshly affected, but some occupational groups benefit at the expense of others. The simulation results also suggest that, in response to an event like the 2008 World Financial Crisis, a slightly decrease in the GST rate is more effective than a significant increase in the tourism tax rate.

This chapter evaluates the economic impacts of SAFTA relative to alternative trade policies to determine which policies best deliver increased welfare to citizens, thereby helping to alleviate income disparities and poverty in the region. The study does so with a particular emphasis on the income inequality and poverty effects of trade liberalisation in South Asia on households in Sri Lanka. A static multi-country computable general equilibrium model for South Asia (SAMGEM) is formulated by incorporating a multiple household framework into the Global Trade Analysis Project (GTAP) model. A nonparametric extended representative household agent approach is used to estimate the income inequality and poverty effects of trade liberalisation in South Asia by using micro-household survey data. The findings revealed that amongst the different trade policy options considered, unilateral trade liberalisation ensures the highest welfare to all South Asian members followed by the customs union (with the exception of Sri Lanka) and the SAFTA. The poverty and income equality analysis for the Sri Lankan economy suggests that poverty is predominant in the rural and the estate sectors and Sri Lanka can achieve a significant progress towards poverty reduction as a result of implementing trade reforms.

The paper analyses the effects of biofuel development on food security and the agricultural sector using the global trade analysis project (GTAP) model. It attempts to quantify the economic effects of taxes and/or subsidies on the agricultural and biofuel sectors within APEC, the EU, Brazil and Sub-Saharan Africa. The balance between food security and energy security will be bleak in the future as population increases notwithstanding changes in income (i.e., changing diets, increasing demand for consumer non-durables and durables). The latter does not only increase demand for energy but puts food and energy security at odds with each other.

A bilateral Free Trade Agreement (FTA) between Australia and the United States came into effect on 1st January 2005. Since the U.S. is one of the main trading partners for Australia, it was anticipated that the FTA would bring a substantial increase in Australia's bilateral trade with the United States. It would also have important implications for Australia's other main trading partners such as Japan, and China. This paper seeks to provide a quantitative assessment of the impact of the FTA by undertaking simulations usingthe Global Trade Analysis Project (GTAP) model. By simulating the GTAP multi-country CGE model, the paper evaluates various economy-wide effects, sectoral level effects, and trade diversion and trade creation effects in the two countries in response to bilateral free trade. It will also identify the effects on trading partners outside the FTA. The results will provide a preliminary indication of the magnitude of welfare gains involved.