A Global Perspective of Liberalizing World Textile and Apparel Trade

International trade in textile and apparel has been governed by quantitative restrictions under the Multi-Fiber Arrangement (MFA) and earlier agreements for more than 30 years. One of the major accomplishments of the Uruguay Round was the Agreement on Textiles and Clothing (ATC), which provides for the dismantling of these restrictions. Under the Uruguay Round ATC, the MFA restrictions are to be phased out over a 10-year period and are scheduled to end by the year 2005. This study combines a data description of the trends in world textile and apparel trade flow, an econometric analysis on the linkage between textile trade and growth, and an intertemporal, world CGE model to evaluate the possible impact of liberalizing world textile and apparel trade. As textile and apparel industry is an important source of the growth, our study focuses on the effect on the developing countries.