Preferential Trade Agreement Examples

Posted by on December 15, 2020

Most of the reciprocal agreements covered by this instrument are free trade agreements. Free trade agreements (FTAs) remove barriers to trade between members and provide preferential access to markets on a reciprocal basis. In addition to trade in goods, free trade agreements generally cover trade in services and investment rules and remove tariff and non-tariff barriers. They may also include a number of provisions relating to customs cooperation and trade facilities, as well as harmonising standards and promoting regulatory cooperation in various areas. As has already been said, these are rules under which a country unilaterally offers preferential rights to another country or group of countries. The country that offers preference removes or reduces import duties on imports from these countries without the same preferences. These rules generally focus solely on trade in goods. These tariff preferences have led to many departures from the principle of normal trade relations, namely that members of the World Trade Organization (WTO) should apply the same tariff to imports from other WTO members. [1] Since the beginning of the 20th century, several hundred bilateral PTAs have been signed. The Canada Research Chair in International Political Economy`s TREND project[6] lists approximately 700 trade agreements, the vast majority of which are bilateral. [7] A Regional Trade Agreement (RTA) is an example of ALP.

In the United States, some industries, such as automakers and electronics manufacturers, favour ATRs because these agreements allow these industries to exploit low production costs in other countries in the hemisphere, while avoiding competition from European and Japanese manufacturers, which they would face in a multilateral agreement. [2] All of the above agreements are indeed free trade agreements, but for various reasons, members prefer to mention them under another name. In many cases, these names reflect the broader scope of agreements: many recent free trade agreements go beyond the scope of traditional trade agreements and cover areas such as public procurement, competition, intellectual property, sustainable development, labour and the environment, etc. The World Trade Organization unilaterally designates preferential trade agreements and reciprocal trade agreements as regional trade agreements. A turnkey example is the Generalized Preference System (GSP): a one-sided preferential program proposed by many industrialized countries (for example. B United States, Switzerland, Japan and the EU) for a number of developing and least developed countries. Preferential rules of origin are applied to prevent third countries from benefiting from preferential tariffs offered to select GSP recipient countries. A preferential trade zone (including preferential trade agreements, PTA) is a trading bloc that offers preferential access to certain products from participating countries.

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