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Abstract

The objective of this paper is to determine the probable losses to the Brazilian regions due to the Doha round of negotiations failure. A model for the General Equilibrium Analysis Project for the Brazilian Economy (PAEG) is built following the GTAPinGAMS structure and syntax. The PAEG model is multiregional at a global level as well as at the Brazilian level. PAEG database is constructed using input-output matrix for 5 Brazilian regions connected to the GTAP database version 7. It is simulated the Doha Round requirement for agricultural production and exports subsidies reduction. Also, this scenario includes reduction on bound import tariffs. All regions considered in the current aggregation lose gains in economic growth and welfare due to the Doha Round failure. The Midwest is the Brazilian region that loses the most in terms of economic growth while the South region presents the highest welfare loss. While agriculture is highly competitive in all Brazilian regions, the manufacture sector is not. Thus the Doha Round failure allows an additional period of time to implement public policies and private management strategies to guarantee competitiveness to the manufacture sector in the case the new Doha Round agreement is signed.

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