The Impacts of Trade Liberalization on Ethiopian Textile and Garment Sector
Chapter one Introduction
The proponents of classical theories on international free trade predict that free trade based on competitive advantage leads to mutual benefits to the trading partners; whereas, opponents of free trade insist on protectionism to secure fairness, Hill. (2005). There are a number of empirical evidences supporting both ideals of free trade and the positions of the opponents.
Based on the above approaches to trade liberalization , chapter two will present the overall principles and arguments related to trade liberalization, followed by benefits and impacts of trade liberalization on income distribution, employment opportunity, and environmental issues focusing on textile and garment sector. Here, particular attention will be devoted to current and potential impacts of trade liberalization on Ethiopian textile and garment industry.
The third chapter of the paper deals with research methodology i.e., data collection techniques, source of data, and tools to analyze and present the findings to reveal whether general assumption held on free trade is consistent with the current business practices, particularly in Ethiopian textile and garment sector.
1.1. Background
In a very general term, Trade liberalization assumed to improve global efficiency in resource allocation. It encourages international competition and cooperation to exchange goods and technological know-how, and etc.
On the other hand, there are also evidences indicating the negative impacts of trade liberalization particularly in least developing countries, inducing income inequalities, job loses and decline of firms.
Textile and garment industry is one of the sectors that were challenged by trade liberalization after the removal of quota on textile products. The impacts of trade liberalization on Ethiopian Textile and garment sector appears to be consistent with some other African countries due to similar constraints in productivity and other factors
The proponents of classical theories on international free trade predict that free trade based on competitive advantage leads to mutual benefits to the trading partners; whereas, opponents of free trade insist on protectionism to secure fairness, Hill. (2005). There are a number of empirical evidences supporting both ideals of free trade and the positions of the opponents.
Based on the above approaches to trade liberalization , chapter two will present the overall principles and arguments related to trade liberalization, followed by benefits and impacts of trade liberalization on income distribution, employment opportunity, and environmental issues focusing on textile and garment sector. Here, particular attention will be devoted to current and potential impacts of trade liberalization on Ethiopian textile and garment industry.
The third chapter of the paper deals with research methodology i.e., data collection techniques, source of data, and tools to analyze and present the findings to reveal whether general assumption held on free trade is consistent with the current business practices, particularly in Ethiopian textile and garment sector.
1.1. Background
In a very general term, Trade liberalization assumed to improve global efficiency in resource allocation. It encourages international competition and cooperation to exchange goods and technological know-how, and etc.
On the other hand, there are also evidences indicating the negative impacts of trade liberalization particularly in least developing countries, inducing income inequalities, job loses and decline of firms.
Textile and garment industry is one of the sectors that were challenged by trade liberalization after the removal of quota on textile products. The impacts of trade liberalization on Ethiopian Textile and garment sector appears to be consistent with some other African countries due to similar constraints in productivity and other factors
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