2 The Bretton Woods trio

The Great Depression of the 1930s leads to the birth of Keynesianism and the interventionist state. As World War Two ends, the victors put together a new set of rules for the global economy. This post-War financial architecture includes the World Bank, the International Monetary Fund (IMF) and the General Agreement on Tariffs and Trade (GATT). But, as Third World nations emerge from centuries of colonialism, these institutions are seen increasingly as pillars of the status quo.

As World War Two was drawing to a close, the world’s leading politicians and government officials, mostly from the victorious ‘Allied’ nations (mainly Britain, the United States, the Soviet Union, Canada, France, Australia and New Zealand) began to think about the need to establish a system of rules to run the post-War global economy.

Before the outbreak of the War in 1939, trading nations everywhere had been racked by a crippling economic depression. When the US stock market crashed in October 1929 the shockwaves were felt around the world. Nations turned inward in an attempt to pull themselves out of a steep economic skid. But without a system of global rules there was no coherence or larger logic to the ‘beggar-thy-neighbor’ polices adopted worldwide. High tariff barriers were hastily erected between countries with the result that world trade nosedived, economic growth spluttered and mass unemployment and poverty followed. From 1929 to 1932 global trade fell by an astounding 62 per cent while global industrial production slumped by 36 per cent. As a result the 1930s became a decade of radical politics and rancorous social ferment in the West as criticism of laissez-faire (‘let it be’) capitalism and an unchecked market economy grew.

Scholars like Hungarian exile Karl Polanyi helped reinforce a growing suspicion of a market-based economic model which put money and investors at the center of its concerns rather than social values and human wellbeing. ‘To allow the market mechanism to be the sole director of the fate of human beings and their natural environment…would result in the demolition of society,’ Polanyi wrote in his masterwork, The Great Transformation.

Polanyi was not alone in his distrust of the market economy. Other thinkers, like the brilliant British economist John Maynard Keynes, were also grappling with a way of controlling global markets, making them work for people and not the other way around. Keynes both admired and feared the power of the market system. With the example of the Great Depression of the 1930s fresh in his mind he predicted that, without firm boundaries and controls, capitalism would be immobilized by its own greed, and would eventually self-destruct. As it happened, only World War Two turned things around. The War set the factories humming again as millions of troops were deployed by all sides in the conflict. Arms manufacturers, aircraft factories and other military suppliers ran 24-hour shifts, primed by government spending. Then, as the War wound down, government policymakers began to think about how to ensure a smooth transformation to a peacetime economy.

Keynesian economics

It was Keynes’ radical notion of an ‘interventionist’ state to which governments turned in an effort to rebuild their economies. Until the worldwide crash of the 1930s, the accepted economic wisdom had been that a degree of unemployment was a ‘normal condition’ of the free market. The economy might go up or down according to the business cycle but in the long run, growth (and increased global trade), would create new jobs and sop up the unemployed.

Keynes was skeptical about this laissez-faire orthodoxy. He believed that the economy was a human-made artifact and that people acting together through their government could have some control over its direction. We must act now, he suggested, since ‘in the long run we’re all dead’. With no other solutions in the wings, his approach offered a lifeline for governments who found themselves helplessly mired in economic stagnation.

In The General Theory of Employment, Interest and Money published in 1936, Keynes argued that the free market, left on its own, actually creates unemployment. Profitability, he pointed out, depends on suppressing wages and cutting costs by replacing labor with technology. In other words, profits and a certain amount of unemployment go hand in hand – so far so good, at least for those making the profits. But Keynes went on to show that lowering wages and sacking workers would eventually backfire. There would be fewer people who could afford to buy the goods that factories were producing. As demand fell, so would sales; factory owners would be forced to lay off even more workers. This, reasoned Keynes, was the start of a downward spiral with terrible human consequences.

To ‘prime the pump’, he suggested that governments should intervene actively in the economy. He reasoned that business owners and rich investors are unlikely to open their wallets if the prospects for profit look dim. When the economy is floundering, argued Keynes, that’s when governments should step in – by spending on public goods (education, healthcare, job training) and on ‘infrastructure’ (roads, sewers, dams, public transport, electricity), and by giving direct financial support to the jobless.

Even if governments had to go into debt to kick-start growth Keynes advised politicians not to worry. The price was worth it. By directly stimulating the economy, government could rekindle demand and help reverse the downward spiral. Once their confidence returned, companies would begin to invest again to increase production to meet the growing demand. This would mean hiring more workers who would soon have more money in their pockets. As jobs increased, so would taxes, from workers and from businesses. Eventually, the government would be able to pay back its debt with increased tax revenues from a now healthy, growing economy.

Desperate Western governments were quick to adopt Keynes’ answer to economic stagnation. In the US, the ‘New Deal’ policies of the Roosevelt administration were directly influenced by Keynes. The American Employment Act of 1946 accepted the federal government’s responsibility ‘to promote maximum employment, production and purchasing power’. The British government, too, in 1944 accepted as one of its primary aims ‘the maintenance of a high and stable level of employment after the war’.

Other countries like Canada, Australia and Sweden quickly followed. Keynes’ influence spread and people began to believe that economics was more than a ‘dismal science’, the term coined by the 19th-century British historian Thomas Carlyle. Maybe it could actually be managed to make the world a more prosperous and predictable place.

‘We are witnessing a development under which the economic system ceases to lay down the law to society and the primacy of society over that system is secured.’ Thus wrote Karl Polanyi, in a moment of supreme optimism just before the end of the war.

It was this confidence that delegates from 44 nations brought to the postcard-pretty resort village of Bretton Woods, New Hampshire, in July 1944. The aim of the UN Monetary and Financial Conference was to erect a new framework for the post-War global economy – a stable, co-operative international monetary system which would promote national sovereignty and prevent future financial crises. The purpose was not to bury capitalism but to save it. The main proposal was for a system of fixed exchange rates. In the light of the Depression of the previous decade, floating rates were now seen as inherently unstable and destructive of national development plans.

Keynes’ influence at Bretton Woods was huge. But despite his lobbying and cajoling he did not win the day on every issue. The US opposed his ‘soft’ approach and in the end the enormous military and economic clout of the Americans proved impossible to overcome.

The Conference rejected his proposals to establish a world ‘reserve currency’ administered by a global central bank. Keynes believed this would have created a more stable and fairer world economy by automatically recycling trade surpluses to finance trade deficits. Both deficit and surplus nations would take responsibility for trade imbalances. However, his solution did not fit the interests of the US, eager to take on the role of the world’s economic powerhouse in the wake of World War Two. Instead the Conference opted for a system based on the free movement of goods with the US dollar as the international currency. The dollar was linked to gold and the price of gold was fixed at $35 an ounce (28 grams). In effect the US dollar became ‘as good as gold’ and in this one act became the dominant currency of international exchange – a position which it still holds, despite growing pressure from China and others to come up with an alternative.

Three governing institutions emerged from the gathering to oversee and co-ordinate the global economy. These were not neutral economic mechanisms: they contained a powerful bias in favor of the industrialized nations, global competition and corporate enterprise. And each had a distinct role to play.

1 The International Monetary Fund (IMF)

The IMF was born with a mission: to create economic stability for a world which had just been through the trauma of depression and the devastation of war. As originally conceived, it was supposed to ‘facilitate the expansion and balanced growth of international trade’ and ‘to contribute to the promotion and maintenance of high levels of employment and real income’.

A major part of its job was to oversee a system of ‘fixed’ exchange rates. The aim was to stop countries from devaluing their national currencies to win a competitive edge over their neighbors – a defining feature of the economic chaos of the 1930s.

The Fund was also to promote currency ‘convertibility’ to encourage world trade – to make it easier to exchange one currency for another when trading across national borders.

And finally the new agency was to act as a ‘lender of last resort’ supplying emergency loans to countries that ran into short-term cashflow problems.

Keynes took a different tack. He wanted to set up an International Clearing Union which would automatically provide unconditional loans to countries experiencing balance-of-payments problems. These loans would be issued ‘no strings attached’ with the purpose of supporting domestic demand and maintaining employment. Otherwise countries feeling the pinch would be forced to balance their deficit by cutting imports, lowering wages and dampening domestic demand in favor of exports.

Keynes stressed that international trade was a two-way street and that the ‘winners’ (those countries in surplus) were as obligated as the ‘losers’ (those countries in deficit) to bring the system back to balance. Keynes suggested that pressure be brought to bear on surplus nations so they would be forced to increase their imports and recycle the surplus to deficit nations.

But Keynes did not prevail. Instead a proposal put forward by US Treasury Secretary Harry Dexter White became the basis for the IMF. The International Clearing Union idea disappeared. IMF members would not automatically receive loans when they fell into deficit. Instead members would have access to limited loan amounts which were to be determined by a complex quota system. Voting power within the IMF would be based on the level of financial contributions – one dollar, one vote – which meant that rich countries would call the shots.

When a country joins the IMF it is assigned a quota which is calculated in Special Drawing Rights (SDRs), the Fund’s own unit of account. Quotas are assigned according to a country’s relative position in the world economy, which means that the most powerful economies have the most influence. In 2014, for example, the US had the largest SDR quota at 42.1 billion (about $65 billion) while the smallest member, the Pacific island nation of Tuvalu, had an SDR quota of 1.8 million (about $2.78 million). The size of a member’s quota determines a lot, including how many votes it has in IMF deliberations and how much foreign exchange it has access to if it runs into choppy financial waters.

Nonetheless, the IMF was founded on the belief that collective action was necessary to stabilize the world economy, just as nations needed to unite together at the UN to bring stability to the global political system.

The final decision was that balance-of-payments loans are contracted at less than the prevailing interest rate and members are supposed to use and repay them within five years. The issue of whether the IMF could attach conditions to these loans was unclear in the original Bretton Woods agreement. But Harry Dexter White was crystal clear six months later when he wrote in the journal Foreign Affairs that the Fund would not simply dole out money to debtor countries. The IMF would force countries to take measures which, under the old gold standard, would have happened automatically.

The delegates at the Bretton Woods Conference supported a gradual reduction of trade barriers and tariffs. The consensus was that the state should focus on jobs, growth and the wellbeing of its citizens – intervening in the market if necessary. But they were less keen on allowing the free movement of capital, which was seen to undercut the policy of fixed exchange rates.

Keynes advocated a balanced world trade system with strict controls on the movement of capital across borders. He held that the free movement of goods and capital, advocated most powerfully by the US delegation, would inevitably lead to inequalities and instabilities. This battle he won at Bretton Woods: capital controls remained in place, more or less, for the next 35 years.

2 The World Bank

One of the other key goals of the Bretton Woods Conference was to find a way to rebuild the economies of those nations that had been devastated by World War Two. The International Bank for Reconstruction and Development was created to spearhead this effort. The Bank is funded by dues from its members and by money borrowed on international capital markets. It makes loans to members below rates available at commercial banks. Its initial mandate was to provide financing for ‘infrastructure’ which included things like power plants, dams, hospitals, roads, airports, ports, agricultural development and education systems. The Bank poured money into reconstruction in Europe after World War Two. But it was not enough to satisfy the US, whose booming industries were in need of markets. In response the US set up its own ‘Marshall Plan’, named after then Secretary of State, George Marshall. From April 1948 to December 1951 the US provided $12.5 billion to 16 European nations, largely in the form of grants rather than loans.

As Europe gradually recovered, the Bank turned from ‘reconstruction’ to ‘development’ in the newly independent countries of the Third World, where it became widely known as the World Bank. As Southern countries sought to enter the industrial age, the Bank became a major player throughout the region. According to the ‘stages of growth’ economic theory popular at the time, developing nations could achieve economic ‘take-off’ only from a strong infrastructure ‘runway’. It was part of the Bank’s self-defined role to build this ‘infrastructural capacity’ and this it did enthusiastically by funding dams, hydroelectric projects and highway systems throughout Latin America, Asia and Africa.

But despite the Bank’s low lending rates it was clear early on that the very poorest countries would have difficulty meeting loan repayments. So in the late 1950s the Bank was pressured into setting up the International Development Association. This wing of the Bank was to provide ‘soft loans’ with very low interest or none at all. It was not all altruism – it was also designed to head off Third World countries from setting up an independent aid agency under UN auspices, separate from the Bretton Woods institutions. In addition, the Bank established two other departments: the International Finance Corporation, which supports private-sector investment in Bank-approved projects, and the Multilateral Insurance Guarantee Agency, which provides risk insurance to foreign corporations and individuals that decide to invest in one of the Bank’s member countries.

3 General Agreement on Tariffs and Trade (GATT)/ World Trade Organization (WTO)

Although Bretton Woods delegates debated the idea of an International Trade Organization there was no consensus. The Americans balked at the idea that trade should be linked to employment policy or that poor countries should get a fairer price for their commodity exports. So the General Agreement on Tariffs and Trade (GATT) emerged in 1947 to set rules on global trade in industrial goods only. Its aim was to reduce the national trade barriers and to stop the beggar-thy-neighbor policies that had so hobbled the global economy prior to World War Two. After seven rounds of tariff negotiations over the next 40 years GATT members reduced tariffs from 40-50 per cent to 4-5 per cent.

The final ‘Uruguay Round’ began in 1986. In March 1994, following its completion, politicians and bureaucrats met in Marrakech, Morocco, to approve a new World Trade Organization (WTO) to replace the more loosely structured GATT. The WTO is officially an international organization rather than a treaty. And unlike the Bank and the Fund it does not set rules. Instead it provides a forum for negotiations and then ensures that agreements are followed. By June 2014 there were 160 member states, accounting for over 98 per cent of world trade. There were also 25 ‘observers’ including eight countries negotiating to join the WTO: Afghanistan, Bhutan, Comoros, Equatorial Guinea, Ethiopia, Liberia, São Tomé & Príncipe and Sudan.

The WTO vastly expands GATT’s mandate. The text of the WTO agreement had 26,000 pages: a hint of both its prolixity and its complexity. It includes the GATT agreements which mostly focus on trade in goods. But it also folds in the new General Agreement on Trade in Services (GATS), which potentially reduces barriers to investment in more than 160 areas – including basic needs like water, healthcare and education as well as telecommunications, banking and investment, transport and the environment. GATS is not a treaty. It’s more like a framework agreement where negotiations can continue indefinitely. For large global corporations it’s a potential goldmine of new business opportunities.

From the outset GATT was seen as a ‘rich man’s club’ dominated by Western industrial nations slow to concede their position of power. The WTO continues this tradition of rich-world domination. Rubens Ricupero, former Secretary-General of the UN Conference on Trade and Development (UNCTAD), is frank in his assessment of the multilateral trading system. It is a matter of ‘concrete evidence’, he said at the September 1999 G77 (developing countries ‘Group of 77’) Ministerial Meeting in Morocco, that global trade rules are ‘highly imbalanced and biased against developing countries’. Why is it, asked Ricupero, that developed countries have been given decades to ‘adjust’ their economies to imports of agricultural products and textiles from the South when poor countries are pressured to open their borders immediately to Western banks and telecommunication companies? As a case in point he mentions the Multi Fibre Arrangement (MFA) on textiles under which industrial countries were allowed to impose quotas restricting clothing and textile imports from developing nations. The MFA developed from a waiver which the US demanded on behalf of its domestic cotton industry in the late 1950s. By the time the MFA was phased out in January 2005 it had lasted nearly 50 years – a ridiculously long time for a ‘temporary’ concession which was to allow US producers to adjust to cheap textile imports.1


The gold standard

Until the Great Depression of the 1930s gold was the one precious metal that most large trading countries in the world recognized and accepted as a universal medium of exchange. The shift to gold began when international trade exploded after the industrial revolution. Britain was the first to adopt the gold standard in 1816; the US made the change in 1873 and by 1900 most of the world had joined them.

Most national currencies were redeemable in gold. Paper bank notes often contained the phrase ‘the bank promises to pay the bearer on demand’ the equivalent in gold. That implied you could go into a bank and demand the equivalent in gold if the mood moved you.

What that meant was that all nations set the value of their national currency in terms of ounces of gold (1 ounce = 28g). It was a convenient way of settling national trading accounts. And the fixed gold standard was supposed to both stabilize foreign exchange rates and domestic economies. A country’s wealth could be measured by the amount of gold it had stored in its vaults; certainly an unfair advantage for those countries lucky enough to be sitting on vast natural deposits of gold.

With gold as a fixed standard the fluctuations of international trade were relatively simple to track. If a country’s imports exceeded its exports then gold had to be shipped to those countries who were owed in order to balance the books. The decline in the amount of gold would then force a government to reduce the amount of cash in circulation. Because money was redeemable for gold both governments and banks would want to make sure they could cover themselves if necessary. Less money in circulation would tend to lower prices, dampening economic activity at home and decreasing imports. Gold flowing to countries on the receiving end would have the opposite effect. Governments would release more cash into the economy to cover the increase of gold in their vaults and prices would tend to increase.

With the Depression of the 1930s one country after another abandoned the gold standard in an attempt to ‘devalue’ their currencies to gain a ‘competitive advantage’ over their trading partners (ie to make their exports cheaper). There was an attempt to modify the gold link after World War Two when the US set the value of the dollar at 1/35 of an ounce (0.9g) of gold but holders of cash were no longer able to demand gold in exchange and the circulation of gold coins was prohibited. Then in 1973 US President Richard Nixon suspended the exchange of American gold for foreign-held dollars at fixed rates. At that point gold became just another commodity, its price determined by the law of supply and demand. Many countries (as well as the International Monetary Fund) continue to hold vast gold reserves and quantities are occasionally sold on the open market – though sellers are careful not to flood the market and depress the international price too much.


In contrast, according to the UN Development Programme (UNDP), developing countries have been much more willing to open their borders to foreign imports and reduce trade barriers. The average tariff in developing countries fell from 25 per cent in the late 1980s to 11 per cent by the end of 2004. India, for example, reduced its tariffs from an average of 82 per cent in 1990 to 7.2 per cent by the end of 2013. Brazil chopped average tariffs from 25 per cent to 7.9 per cent over the same period and China lowered them from 43 per cent in 1993 to 4.1 per cent in 2013. According to UNDP, only 79 per cent of exports from the least developed countries were given duty-free access to the markets of developed countries in 2007. In addition, OECD2 (developed) countries continued to subsidize agriculture to the tune of $258.6 billion in 2012 – a little more than twice the $125.6 billion total of official foreign aid that year. In North America the US spent over $30 billion and Canada more than $7.5 billion on agricultural subsidies in 2012.

Notes UNDP: ‘The world’s highest trade barriers are erected against some of its poorest countries. On average, trade barriers faced by developing countries exporting to rich countries are three to four times higher than those faced by rich countries when they trade with each other.’3

How the WTO has its way

The WTO pursues its free-trade agenda with the single-minded concentration of the true believer. Nonetheless, there is a growing unease about the organization’s globalizing agenda. Critics are especially wary of the Dispute Resolution Body (DRB), which gives the WTO the legal tools to approve tough trade sanctions by one member against another, especially against nations that might disagree with the organization’s interpretation of global trade rules. Any member country, acting on behalf of a business with an axe to grind, can challenge the laws and regulations of another country on the grounds that they violate WTO rules.

Previously, if GATT wanted to discipline one of its members for not playing according to the rules, every member had to agree. The WTO has considerably more power. The DRB appoints a panel of ‘experts’ who hear the case behind closed doors. If the panel decides on sanctions the only way to escape them is if every WTO member is opposed to adopting them – a virtual impossibility. In effect, the WTO regime is one of trade über alles. Environmental laws, labor standards, human rights legislation, public health policies, cultural protection, food self-reliance or any other policies held to be in the ‘national interest’ can be attacked as unfair ‘impediments’ to free trade.

Already there have been cases where the WTO has effectively struck down national legislation in its pursuit of a ‘level playing field’. The 1999 WTO decision against the European Union (EU) over importing bananas is a case in point. The WTO’s ‘most favored nation’ clause demands that similar products from different member countries be treated equally. Under the terms of the Lomé Convention (a trade and aid agreement between the EC and 71 African, Caribbean, and Pacific countries first signed in February 1975 in Lomé, Togo) the EU had promised to give preference to bananas from former European colonies in Africa, the Caribbean and the Pacific. In general these banana growers tend to be small farmers, typically with plots of less than four hectares, who are less dependent on pesticide-intensive plantation methods than the giant US companies like Dole and Chiquita. Bananas account for between 20 and 60 per cent of export earnings in the Caribbean.

The Europeans stressed their right to determine a sovereign foreign policy in relation to former colonies while the US argued that EU tariffs prohibited American banana companies in Latin America from reaching lucrative markets in Europe. The WTO decided on behalf of the US, ruling that the European preference was unfair. Meanwhile, small island nations in the Caribbean, so dependent on income from the banana trade, worried that the decision would wipe out their major market in Britain and destroy their industry. By 2005 their fears seemed to be coming true. The number of registered banana growers in the Windward Islands (Dominica, Grenada, St Lucia and St Vincent and the Grenadines) had fallen from about 24,000 in 1993 to fewer than 5,000 in 2005. Meanwhile, banana-industry earnings tumbled from 20 per cent of the islands’ GDP in the early 1990s to less than five per cent of GDP in 2005.4

Quotas on the import of ‘third country’ (ie Latin American) bananas into the EU were finally eliminated in January 2006. (The Lomé Convention was replaced in June 2000 by the Cotonou Agreement, named after the town in Benin where the deal was signed.)

All nations have the right to use the Dispute Resolution Body to pursue their economic self-interest. But the fact is that the world’s major trading nations are also its most powerful economic actors. So the tendency is for the strong to use the new rules to dominate weaker countries. The ‘national treatment clause’ basically says that a country may not discriminate against products of foreign origin on any grounds whatsoever. And in so doing it removes the power of governments to develop economic policy which serves the moral, ethical or economic interests of their citizenry. WTO rules prohibit members from barring products if they disagree with the ‘Processes and Methods of Production’. For example, if t-shirts or shoes are produced by children in sweatshop conditions, that is not considered germane. The same is true if a foreign factory fouls the air, if poverty wages are paid to workers or if the goods themselves are poisonous and dangerous.

According to WTO rules, any country that refuses to import a product on the grounds that it may harm public health or damage the environment has to prove the case ‘scientifically’. So Canada, the world’s biggest asbestos producer, petitioned the WTO’s dispute panel and won – forcing the EU to lift its ban on the import of the known carcinogen. And when the EU refused imports of hormone-fed beef from North America, the US took the case to the WTO arguing that there was no threat to human health from cows fed on hormones. The EU ban on hormone-fed beef also applied to the region’s own farmers but that made little difference. The WTO’s dispute resolution panel decided in favor of the US, effectively ruling that Europeans had no right to pass laws that supported their opposition to hormones. The EU was ordered to compensate producers in the US and Canada for every year of lost export earnings. And in retaliation the WTO allowed the US to impose $116 million worth of sanctions on a range of European imports – including Dijon mustard, pork, truffles and Roquefort cheese.

Meanwhile, in 2001 the giant US-based shipping company, United Parcel Service (UPS), lodged a complaint with the North American Free Trade Agreement (NAFTA) – which runs a dispute resolution body similar to the WTO – threatening Canada’s government-run postal service. UPS charged that Ottawa is unfairly subsidizing Canada Post and therefore poaching potential customers. In response, the Council of Canadians and the Canadian Union of Postal Workers (CUPW) asked Ontario’s Superior Court of Justice to rule NAFTA’s investment rules as unconstitutional.

‘UPS claims that simply by having a public postal system, Canada is allowing unfair competition,’ charged Council Chair Maude Barlow. ‘By this logic, every public service from healthcare to education could face similar lawsuits. We don’t intend to let foreign corporations destroy our public services.’

In June 2007, the UPS claim was denied when the NAFTA tribunal hearing the challenge dismissed the $160-million suit against the Canadian government.

A year earlier, the WTO sided with Canada, the US and Argentina in a dispute with the EU over genetically engineered crops. The WTO argued that the EU discriminated against biotech seeds without adequate scientific evidence. US agribusiness claimed the ban cost American firms $300 million a year in sales to the EU. Critics, however, called the WTO decision a ‘direct attack on democracy’ – undaunted, EU governments voted in 2005 to reaffirm their ban on GM seeds.5

And so it goes in the topsy-turvy world of economic globalization. Those institutions which first emerged from the Bretton Woods negotiations half a century ago have become more important players with each passing decade. It is their vision and their agenda which continue to shape the direction of the global economy. Together, they are fostering a model of liberalized trade and investment which is heartily endorsed by the world’s biggest banks and corporations. A deregulated, privatized, corporate-led free market is the answer to humanity’s problems, they tell us. The proof, though, is not so easily found.

1 Martin Khor, ‘WTO must correct imbalances against South’, Third World Network Features, Oct 1999. 2 OECD stands for Organization for Economic Co-operation and Development – 34 of the most developed countries are members. 3 Human Development Report 2005, UNDP, New York, 2005. 4 ‘Caribbean Bananas: The Macroeconomic Impact of Trade Preference Erosion’, IMF Working Paper, M Mlachila, P Cashin, C Haines, March 2010. 5 ‘Biotech industry gets boost’, Toronto Star, 8 Feb 2006.