Peterson Institute publications
The Peterson Institute for International Economics is a private, nonprofit, nonpartisan
research institution devoted to the study of international economic policy. More › ›
RSS News Feed Search

Policy Brief 14-6

A Proposed Code to Discipline Local Content Requirements

by Cathleen Cimino, Peterson Institute for International Economics
and Gary Clyde Hufbauer, Peterson Institute for International Economics
and Jeffrey J. Schott, Peterson Institute for International Economics

February 2014


The global economic crisis in 2008 produced pledges from countries around the world to avoid new barriers to trade and investment. These commitments were largely honored when it came to tariffs and quotas, but not when it came to nontraditional forms of protection, including behind-the-border, nontariff barriers such as local content requirements (LCRs). This Policy Brief analyzes the impact of the widely used requirements that local suppliers of goods, services, and even entire projects be favored. It explains why the steps to prevent such protectionism have been effective and further recommends a new World Trade Organization (WTO) code to constrain the use of LCRs, enhance transparency, expedite dispute resolution, and impose penalties for noncompliance.

View full document [pdf]


RELATED LINKS

Book: Local Content Requirements: A Global Problem September 2013

Op-ed: Too Much Legitimacy Can Hurt Global Trade January 13, 2013

Policy Brief 12-11: Will the World Trade Organization Enjoy a Bright Future? May 2012

Op-ed: The G-20 Is Failing April 12, 2012

Paper: The Doha Dilemma: Implications for Korea and the Multilateral Trading System September 26, 2011

Policy Brief 11-8: What Should the United States Do about Doha? June 2011

Op-ed: US Trade Policy and the Doha Round: An Alternative View May 18, 2011

Book: Figuring Out the Doha Round June 2010

Policy Brief 10-11: A Trade Agenda for the G-20 May 2010

Working Paper 09-6: What's on the Table? The Doha Round as of August 2009 August 2009

Article: A Crisis Round of Trade Negotiations? March 30, 2009

Op-ed: A 5-Step Program for Doha Rehabilitation: Rational Expectations about the Doha Round Negotiations July 18, 2008

Working Paper 08-2: Currency Undervaluation and Sovereign Wealth Funds: A New Role for the World Trade Organization January 2008

Book: Global Warming and the World Trading System March 2009

Book: Delivering on Doha: Farm Trade and the Poor July 2006