Razeen Sally's New Frontiers in Free Trade - Chapter 3

Sally writes that liberalization critics should be silenced on multiple accounts. First, he notes that according to an OECD study, countries with liberal trade policies grow faster than less open countries. He cites Southeast Asia as a region that opened up its borders and provided incentives to invest in their markets. These countries subsequently had FDI-led growth according to Sally.
He writes that external shocks or crises can be beneficial to growth, as can mitigating the power of domestic interest groups. Strong institutions are seen more often in developed countries than poor countries and seem to provide the stability necessary to foster growth.
Sally provides a few ideas on how future liberalization can happen. First, he writes that “trade policy should be coupled strongly with competition-friendly measures to improve the domestic business climate.” Second and third, he requires that trade be seen “through the prism of the domestic economy” and that policy-making should be simple and transparent.
I generally agree with Sally on these issues. Waiting on non-governmental institutions to provide agreed upon resolutions for trade policy takes too long and inevitably does not properly look after the interests of each domestic economy. The US Senate writes up thousand page bills regarding health care that no one reads or can completely comprehend. This is not a good example for trade policy, although having politicians and NGOs draft trade agreements follows essentially the same process. Each government should make simple trade policies based on unilateral liberalization that echoes domestic economic policies.