This book has shown that over the past 30 years emerging market and developing countries have lost a significant amount of policy space to pursue development strategies that have worked in the past for industrialized and developing countries alike. The WTO, and even more so BITs and FTAs, curtail the room to maneuver in the twenty-first century. But each of these deals was a negotiation, implying that nations have traded away this policy space of their own free will. That is true. However this book and the work of others shows that in many cases such “acceptance” was due to asymmetric bargaining power, collective action problems and beyond. Indeed, many of those problems became overturned at the WTO and have prevented the further restriction of policy space for development. This final chapter draws on the rest of the book to put forth some ideas regarding what a world trading system that put development first would look like.

Re-embedding Liberalism

During the postwar period, many developing countries were not yet included in GATT, and, even when they were, they were allowed to play under different rules given that they were not considered much of a threat by the industrialized world. By the 1990s, advanced countries faced competition by some developmental states and asserted a trading system that among other things would place limits on policy space for industrialization and financial stability.