How much policy space still exists under the WTO? A comparative study of the automotive industry in Thailand and Malaysia

Dawn of Industrialisation? The Indonesian Automotive Industry

“…However, there are policy differences too. Thailand skilfully used excise-duty provisions to encourage its product champions-first the pick-up truck, and then the eco-car Thoburn 2013, 2014)-while Indonesia has gained from its focus on MPVs and on light commercial vehicles for private use, whose economies of scale are less pronounced than those of sedans. Indonesia has encouraged investment in its LCGC by exempting it from luxury tax, but not, as we have indicated, by providing incentives to investors like those in Thailand .…”

“…In addition, starting mainly in the 2000s, the kinds of policies that are internationally acceptable have changed. Restrictions imposed by the WTO on trade-related industrial policies have restricted the 'policy space' available for promoting the development of automotive industrialisation, especially of the import-substituting kind that characterised the attempts of most developing countries-including Indonesia-to establish their industry (Gallagher 2005;Wade 2003;Natsuda and Thoburn 2014). In this context, Indonesia has some interesting features in contrast to its ASEAN neighbours.…”

“…Similarly, Thailand has continued to promote increased local content (LC), though LC requirements are banned under the WTO's rules on trade-related investment measures. It has done so by using fiscal measures that have been sufficiently WTO-compliant to avoid protests Thoburn 2013, 2014). In contrast, Indonesia's LC requirements were strongly attacked under the conditionality imposed on loans from the IMF after the 1997-98 Asian financial crisis (Hale 2001, 634).…”

Rethinking Development Space in Emerging Countries: Turkey's Conservative Countermovement

“…More importantly, many developing states stepped up their industrial policy efforts (Aggarwal and Evenett, ; Wade, ). In fact, the long‐term trend suggests that, in response to ever constraining multilateral rules, countries in the North as well as South learn to use more effectively whatever policy room they have left to foster their domestic industries (Block, ; Natsuda and Thoburn, ; UNCTAD, : 95).…”

What's Wrong with the WTO and How to Fix It By RordenWilkinsonCambridge: Polity, 2014.

“…Even after all these years, international trade in agriculture and services remains relatively restricted behind tariff (and other) barriers. Still, the WTO has produced considerable policy innovation beyond simple trade‐barrier reduction: from TRIMs (Trade‐Related Investment Measures) and TRIPs (Agreement on Trade‐Related Property Rights) to SCMs (Agreement on Subsidies and Countervailing Measures) and GATS (General Agreement on Trade in Services) (see, e.g., for a comparative case study of several of these, Natsuda and Thoburn ). Since the 2008 financial crisis, proponents of open markets fear that trade barriers across the board may once again return to fragment the world economy.…”