Analysis of the operation of the manufacturing sector in connection with trade liberalizationrnis important. It helps to see what impacts (positive or adverse) has happened following thernchange in trade regime and envisages what action to take in the future. Review of tradernrelated policy measures and assessment of the extent of liberalization are made using somernindicators. Both econometric and descriptive techniques are also applied to investigate thernoperation of the manufacturing sector and the association between measures of productivityrnand some indicators of liberalization.rnThe results indicate that manufacturing output, value added, capital expenditure and salesrnhave increased after the reform when compared with the pre reform situation. Share ofrnmanufacturing export, however, depicted a declining trend after 1995/96. There is also anrnincrease in the number of firms though manufacturing employment has not shown significantrnchanges between the two periods. The increase in output that observed after the reform isrnmainly attributed to the performances during the initial periods of the trade reform than beingrnthe whole period phenomena.rnOnly a minor increase in productivity has been observed in the post reform period. Increasedrncompetition across domestic firms and fall in parallel market premium are found to affect thernproductivity of the manufacturing sector positively, while the effect of change in relativernprices (measured by ratio of effective exchange rates) is not significant. Size of the differentrnsector also has an implication on efficiency.rnThe observed results, in general, imply that strengthening domestic competition byrnencouraging entry and liberalizing the foreign exchange market with accompanied tradernpolicy adjustment has impacts on the performance of the manufacturing sector. Emphasizingrnthe role of prices alone is not, however, sufficient to bring the intended changes inrnproductivity.