| Examples of regional trade agreements |
|---|
| The European Union |
| European Free Trade Association |
| North American Free Trade Agreement |
| Southern Common Market |
| Common Market of Eastern and Southern Africa |
| ASEAN Free Trade Area |
A regional trade agreement (RTA) is an economic trade agreement to reduce tariffs and restrictions on trade between two or more nations within a certain region. There are currently 205 agreements in force as of July 2007. A total of 300 RTAs have been reported to the World Trade Organization (WTO). [1] There are a variety of RTAs; with some being quite complex (European Union), while others are far less intensive (North American Free Trade Agreement).[2] For the most part, governments are supportive of further RTAs; however, there have been some concerns expressed by the WTO. According to Pascal Lamy, Director-General of the WTO, the proliferation of RTA “...is breeding concern — concern about incoherence, confusion, exponential increase of costs for business, unpredictability and even unfairness in trade relations.” [3]
RTAs are preferential trade agreements and therefore different from arrangements such as APEC, which are open not preferential. RTAs come in different forms:
- An FTA is a group of two or more customs territories which has eliminated tariffs and other trade restrictions on substantially all trade.
- A Customs Unions is two or more customs territories which have an FTA and which also apply a common external tariff on goods from non-members.
- A regional economic integration agreement is the next step: it can include the free movement of capital as well as goods and services, a common currency and a common economic policy
References
- ^ "Regional trade agreements". WTO. 2007-7. http://www.wto.org/english/tratop_e/region_e/region_e.htm. Retrieved 2008-07-20.
- ^ Whalley, John (1998). "Why do countries seek Regional Trade Agreements". The Regionalization of the World Economy. p. 64. ISBN 0226259951. http://books.google.com/books?hl=en&lr=&id=RxvLPTCDqVoC&oi=fnd&pg=PA63&dq=Regional+trade+agreement&ots=IrnQAjB7kU&sig=7sLsMYmPMWBpmL-FEfBGJCyTnrg#PPA64,M1. Retrieved 2008-07-21.
- ^ Lamy, Pascal (2007-09-10). DG Pascal Lamy - Proliferation of regional trade agreements “breeding concern” -- Lamy. Geneva. http://www.wto.org/english/news_e/sppl_e/sppl67_e.htm. Retrieved 2008-07-20.
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