The goal of this chapter is to evaluate the impact of three prospective trade reforms on poverty in fifteen developing regions and to identify the most significant components of these reforms from a poverty perspective. To that end, the chapter uses the latest GTAP data, household survey data and a modified version of the GTAP model that includes AIDADS consumer preferences. Poverty impacts are assessed using post-simulation techniques based on the household survey data.
Results suggest that the near term effects of the core Doha scenario on poverty in the 15 countries in our sample would be mixed, with substantial reductions in some cases, while some countries are unaffected, and others show small poverty increases. Introducing reciprocal (i.e. deeper) cuts in bound tariffs in the developing countries improves the poverty outcome overall. Indeed the core Doha scenario is less poverty friendly than the reforms that are not undertaken in this scenario. The reason for this is the heavy emphasis of Doha on cuts to export subsidies and domestic support, both of which tend to raise poverty in this sample of countries. On the other hand, the most poverty friendly reform measure, namely cuts in developing country tariffs, is nearly absent from the core Doha scenario. These limited cuts in developing country applied tariffs are caused by extensive binding overhang and non-reciprocal tariff cuts in the developing countries.