Analyzing the experience of developing countries in recent years and the deadlock in trade negotiation in WTO, the author argues that the theories and practices of trade and industrial policies are surrounded by a number of fallacies: that universal and across-the-board trade liberalization is to the benefit of all developing countries, irrespective of their level of development; that the Invisible Hand of free market alone is conducive to industrialization, that the infant industry argument is against export expansion; that developed countries industrialized without government intervention; that WTO rules are conducive to development.

MEHDI SHAFAEDDIN is a development economist with D.Phil from Oxford University, UK. He is in charge of the Macroeconomics and Development Policies Branch, Globalization and Development Strategies Division of UNCTAD. He has extensive experience at national and international levels as a researcher, university lecturer and trainer. He has published a large number of articles on trade and industrial policies, economic reform, development of oil exporting countries and other development policy issues.