Competitiveness in global trade in edible oil

Abstract

Away from classical theories of absolute and relative comparative advantage, modern agricultural industries are also experiencing a new paradigm for competitiveness. As producer countries attempt to appropriate more and more of added values, the framework for competitiveness shifts to newer grounds more in sync with the agricultural policies of the developed importing western world. Interventions through government policies, notwithstanding supposedly a multilateral trade regime, distort competitiveness in the market place. This is done by limiting market access through innovative non-tariff trade barriers and levying discriminatory tariffs mainly to protect and promote increased growth of domestic industries at the cost of the home consumers. This paper attempts to overview some of these developments affecting competitiveness of global trade in edible oils, in particular with respect to palm oil.