Transparency in Trade Policymaking: Lessons for South Africa from Australia’s Experiences

Image: Flickr, Flowcomm
Image: Flickr, Flowcomm

Trade policy reform in the form of trade liberalisation is a very important tool for raising living standards and improving a country’s economy.

Such reform on its own, however, is likely to be rejected by the public and those sectors that would be most adversely affected. The key to gaining support for trade policy reform really lies in the concept of transparency, which helps to explain policy change, which in turn assists the public to accept change and creates a coalition for change. Australia is a very good example of the power of transparency in trade policy reform.

Hawke government, elected in 1983, managed to liberalise a highly protected economy through the successful application of transparency. The government ensured that the public was privy to all information related to trade policy reform. Very influential in this drive was an enquiring media and an intellectual base that produced independent, evidence-based reports on the costs of trade protectionism. The short-term risks and long-term benefits were made clear to the public and, simultaneously, adjustment assistance was provided for those that would be most adversely affected by reform. Rather than pursue trade protectionism, South Africa could learn from the Australian experience by setting up a body of independent experts to determine the benefits of trade policy reform and publish their findings. Reform should be accompanied by openness and honesty, which will help garner public support for it if the public is kept fully informed of the need for it and the processes involved. The media should also engage with such issues and report on them. As long as the government tackles trade policy reform in an honest and transparent manner, the benefits are likely to outweigh the disadvantages.

23 Aug 2010