GTAP Resources: Resource Display
| GTAP Resource #7866 |
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"Future Trade Integration, LDC Graduation, and Lao Economic Development: A General Equilibrium Analysis" Authors: Chanthavong, Sinthavanh Abstract Lao PDR's 2026 graduation from Least Developed Country status will change the market access conditions facing its exporters. The main risk is not a uniform loss across the economy, but a concentrated shock to the EU-facing apparel corridor that has relied on duty-free access. This paper estimates the likely external market-access loss and then traces how that loss affects domestic exports, output, and welfare. In the headline economy-wide results, an MFN fallback reduces EU exports by 16.916%, lowers equivalent variation by 0.308%, and contracts wearing-apparel output by 22.00%. GSP+ sharply reduces the simulated loss, but only if apparel firms can satisfy double-transformation rules of origin and use the preference in practice. RCEP access helps redirect trade toward regional destinations, yet it does not replace the lost EU apparel preference margin. RCEP plus MFN graduation keeps total exports positive, while welfare remains negative and apparel output falls further. The policy implication is practical: graduation readiness depends on usable fallback preferences, rules-of-origin compliance, regional market access, transport efficiency, and productivity upgrading in the activities most exposed to preference erosion. |
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- Bridging CGE and new quantitative trade (NQT) literature - Multilateral trade negotiations - New quantitative trade models - Preferential trading arrangements - Trade in textiles and wearing apparel - Asia (Southeast) |
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Public Access  GTAP Resource 7866 (843.1 KB) Replicated: 0 time(s)Restricted Access No documents have been attached. Special Instructions No instructions have been specified. |
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Last Modified: 4/30/2026 12:56:16 PM
