PREFERENTIAL TRADING ARRANGEMENTS

Size: px
Start display at page:

Download "PREFERENTIAL TRADING ARRANGEMENTS"

Transcription

1 PREFERENTIAL TRADING ARRANGEMENTS The Treaty of Rome, reached in 1957, set in motion a process of integrating the economies of Western Europe. This process has culminated with the European Union which is beginning to achieve a level of economic integration just short of that in the US. The student is encouraged to visit the EU s homepage at EUROPA - European Union website, the official EU website on the web. In 1988 the US signed a free trade agreement with Canada. In 1994 the agreement was extended to include Mexico. With concurrent trade liberalization in the rest of Latin America, there is a momentum that may lead to a Western Hemispheric trade bloc. The Bush and Clinton administrations have advocated the expansion of NAFTA into the Trade Bloc of the Americas, but resistance by labor groups in the US has stalled progress. NAFTA s homepage at is also interesting reading. The countries of the Pacific Rim already in the political union called ASEAN - Association of South East Asian Nations - are slowly progressing in forming a free trade agreement between them. On a broader scale APEC, the Asian Pacific Economic Cooperation, includes not only the ASEAN nations but all Pacific Rim countries. Current APEC membership includes Australia, Brunei, Canada, Chile, People's Republic of China, Hong Kong, Indonesia, Korea, Japan, Malaysia, Mexico, New Zealand, Papua New Guinea, the Philippines, Singapore, Chinese Taipei, Thailand, and the United States of America. What are the implications of this regionalization on continued liberalization of international trade? This is a controversial topic. The two sides of the issue give opposing answers to the following two questions. Does regionalization mean the abandonment of WTO (GATT)? Will regionalization help or hinder the goal of global free trade? What is important is that regionalization is occurring and we need to have an understanding of its implications. There are several types of preferential trading arrangements. These are based on the level of integration among participating countries. These are listed below in order of the level of economic integration from least to most. A free trade agreement is the removal of barriers of trade between members. It still requires border checks between members since individual countries still have different trade relations with the rest of the world. This leads to what is known as the transshipment problem. Transshipment is when goods are shipped through a third country. A Trade Blocs page 1

2 foreign exporter in order to avoid high tariffs would export its goods to the member country with TRADE BLOCS Andean Group Arab Maghreb Union Asia Pacific Economic Cooperation Forum APEC Association of Southeast Asian Nations ASEAN Caribbean Community and Common Market CARICOM Central American Common Market Commonwealth of Independent States CIS Economic Community of Central African States CEEAC Economic Community of West African States ECOWAS European Free Trade Association EFTA European Union EU Latin American Integration Association LAIA North American Free Trade Agreement NAFTA South Asian Association for Regional Cooperation SAARC Southern Cone Common Market MERCOSUR members of the customs union. the lowest tariff rates and then ship the product to other member countries with relatively higher tariff rates. To avoid this problem, free trade agreements usually contain local content regulations. Customs unions not only have removal of trade barriers the same as FTA but they have a higher level of integration by including a common external tariff. With a common external tariff, all members adopt the same trade policies with the rest of the world. This does away with the transshipment problem since tariff rates are the same across all A common market has the same provisions as a customs union but also eliminates barriers to factor movements among its members. This is a significant jump in the level of integration. Labor is now free to migrate between countries in a common market. An economic union, the European Union for example, augments the level of integration found in a common market. It requires the coordination of economic policy among its members. This may take the shape of a common currency or restrictions on fiscal policy. As we move up the level of economic integration the greater will be the loss of national sovereignty for the individual member. A country s ability to set its own course diminishes as policymaking is done at the union level. THEORY OF TRADE BLOCS The formation of a trade bloc is achieved by granting preferential treatment to member nations as opposed to non-members. The realignment of countries into a trade bloc will have effects that are both immediate and also that develop over time. Trade Blocs page 2

3 Static effects The static effect leads to a change in the trade patterns among members as well as with nonmember countries. We use the welfare economic tools of consumer and producer surplus to analyze the implications of forming a trade bloc. The change in the patterns of trade has two major static effects, one that leads to a more efficient allocation of resources, and the other which is movement away from global comparative advantage. Trade creation, which increases efficiency in the allocation of resources, arises from the removal of trade barriers between member countries. The major result of this is, barring any other impediments, that resources among member countries will be applied to activities for which they have the lowest opportunity costs among S the member nations, in essence to their comparative advantages. P* + t P* A B C D qs qst qdt qd Quantity Figure 1 Suppose there are two countries in a trade bloc, the US and Mexico. Further suppose that Mexico is a lower cost producer of an item. Thus the US would import the good. Figure 1 portrays the US s demand and supply of the good. With a tariff, imports are restricted to qdt-qst. The elimination of the US tariff (t) on Mexican imports, leads to a gain for US consumers of the areas A+B+C+D. Of these, A and C represent transfers for producers and government, respectively. Hence the net gain which accrues to the country are areas B and D which results from the elimination of deadweight loss. This is similar to our previous discussion of the costs of a tariff. D The other static effect, trade diversion, leads to a less efficient allocation of resources. The discussion of trade diversion requires introducing an outside non-member nation into the analysis. In essence by giving preferential treatment to member countries over non-members, the possibility Trade Blocs page 3

4 exists that production of the good will shift from the lowest cost producer to a higher cost producer. This would represent a shift away from comparative advantage and a less efficient allocation of resources. Suppose there are three countries, the US, Mexico and Chile. Of these, let Chile be the lowest cost producer of the good, while the US is the highest cost producer. In Figure 2 Chile s price (Pc) is lower than Mexico s (Pm), whereas the US autarkic price (Pa) is higher than both the others. Pm + t Pc + t Pm Pc Figure 2 A B qs qst C E Sa D Da Quantity qdt qd Prior to the US entering a trade bloc with Mexico, Chile has both the comparative advantage as well as the competitive advantage in producing and selling the good. Competitive advantage is defined here as the full price of the good to US consumers. This would be inclusive of taxes and tariffs. With a uniform tariff against both Mexico and Chile, Chile s competitive price (Pc + t) would still be lower than Mexico s competitive price (Pm + t). In this case, the US will import the good from Chile. If the US and Mexico form a trade bloc exclusive of Chile, the set of relevant prices to US consumers changes because the tariffs on Mexican goods are eliminated. This gives Mexico the competitive advantage even though Chile has a comparative advantage. Now, with Pm being less than Pc+t, the good will be imported from Mexico instead of Chile. So, as a result of the trade bloc, production of the good shifts away from the lowest cost producer, Chile, to the higher cost producer, Mexico. This represents a movement away from comparative advantage and leads to a less efficient allocation of resources. The welfare implications require comparing consumer and producer surpluses before and after the formation of the trade bloc. Initially, US consumers paid Pc+t for the good and the US government earned tariff revenues of t*(q dt -q st ) given by areas C+E. With the formation of the trade bloc, price fell to Pm when the tariff was eliminated. Consumers in the US gain areas A+B+C+D of which A and C represent transfers from producers and government, respectively. Government lost all tariff revenue. Area C is transferred to consumers and area E represents a loss not being captured by Trade Blocs page 4

5 anyone. Areas B + D represented the deadweight loss of having the tariff which now goes to consumers because of the trade bloc. Therefore the net gain to society is the sum of areas B+D less area E. Should area E be greater than B+D, then the US could be made worse off for having joined the trade bloc. The degree of trade diversion will depend upon two factors: the level of protection levied against non-member nations, and the differential in the costs of production between the low-cost member producer and the lowest-cost non-member producer. What is important is a comparison of the competitive costs between the two. The country that will prevail, after all is said and done, is the one that can provide the good to US consumers the most cheaply. Mexico has the advantage of not having the tariff but Chile has the lower cost of production. For trade diversion to occur, Chile has the comparative advantage ( Pm > Pc) but Mexico has the competitive advantage (Pc + t > Pm). With this last statement, the greater the difference between Pc+t and Pm, the greater the scope for trade diversion. Subtracting Pm from Pc+t and rearranging terms gives the price spread of (Pc-Pm) + t. The larger this number, the greater the possibilities for trade diversion. Note that we have two counteracting forces. The tariff (t) is a positive number and so the greater the preferential treatment accorded to the member nation the more likely trade diversion will occur. The first term represents the differential in the cost of production between Chile and Mexico. Since Chile has the comparative advantage, it is a negative number. If Chile s costs of production are less than Mexico s by an amount greater than the tariff, [ -(Pc-Pm) > t ], then Chile can absorb the tariff and still retain the competitive advantage and no trade diversion occurs. But, as either the tariff rises or the cost differential narrows, the greater the price spread and the scope for trade diversion. In a world of growing regionalization where industrial countries are including middle-income countries in trade blocs, the implications for trade diversion are enormous. For example, NAFTA s combining the US and Mexico will lead to a great deal of trade diversion from nonmember countries with similar cost structures as Mexico. The advantages that accrue to Mexico will be at the expense of other middle- income countries, particularly of the Pacific Rim and Latin America. Trade Blocs page 5

6 Dynamic Effects Joining a trade bloc increases the size of the market that a firm can sell to. This has important implications with regards to economies of scale, especially for smaller countries. A small country may not have sufficient market demand for a firm to fully capture economies of scale. In Europe s situation with many small countries, there was a high degree of redundancy in the number of firms, each servicing domestic markets. Each firm was in essence inefficient in that the size of the domestic market did not allow it to expand production sufficiently to enjoy the low costs of largescale production. With the formation of the EU, the number of firms will decrease but the size of the remaining firms will expand, creating efficiency. Reports about the European Union estimate the gains from economies of scale will lead to about a 3% expansion of European production. Increasing market size will also diminish the market power of individual firms. By opening up markets, domestic firms will face greater competition. Monopoly power will fade as a result, and domestic firms will have an incentive to increase productivity through implementing newer technology or better management. In situations where partner countries are dissimilar in capital endowments, there may also exist possibilities for investment. Capital will find the highest return. In general this is where capital is scarce. Trade Blocs page 6

The Relative Significance of EPAs in Asia-Pacific

The Relative Significance of EPAs in Asia-Pacific The Relative Significance of EPAs in Asia-Pacific 10 November 2015 Kenichi Kawasaki GRIPS/JIIA/RIETI 29 October 2011 Overview The relative significance of EPAs in Asia-Pacific TPP and RCEP are shown to

More information

Legal Review of FTA Tariff Negotiations

Legal Review of FTA Tariff Negotiations Legal Review of FTA Tariff Negotiations Prof. Jong Bum Kim August 6, 2007 Legal Review of FTA Tariff Negotiations 1. Recent state of FTAs in the world Causes behind FTA Proliferation 2. WTO Consistent

More information

APEC AND PROGRESS TOWARD BOGOR GOALS

APEC AND PROGRESS TOWARD BOGOR GOALS APEC AND PROGRESS TOWARD BOGOR GOALS Inter-American Development Bank March 2010 This document was prepared by the Integration and Trade Sector (INT) of the Inter-American Development Bank (IDB) for the

More information

tariff global business nontariff barriers multinational corporation quota direct foreign investment trade barriers voluntary export restraints

tariff global business nontariff barriers multinational corporation quota direct foreign investment trade barriers voluntary export restraints global business tariff multinational corporation nontariff barriers direct foreign investment quota trade barriers voluntary export restraints protectionism government import standard A direct tax on imported

More information

Division on Investment and Enterprise

Division on Investment and Enterprise Division on Investment and Enterprise Readers are encouraged to use the data in this publication for non-commercial purposes, provided acknowledgement is explicitly given to UNCTAD, together with the reference

More information

The Relative Significance of EPAs in Asia-Pacific

The Relative Significance of EPAs in Asia-Pacific The Relative Significance of EPAs in Asia-Pacific 19 June 2014 Consulting Fellow, RIETI Kenichi Kawasaki 29 October 2011 Overview The relative significance of EPAs in Asia-Pacific TPP and RCEP are shown

More information

Exploring Global Business

Exploring Global Business Ch.3 Exploring Global Business 1 Explain the economic basis for international business. 2 Discuss the restrictions nations place on international trade, the objectives of these restrictions, and their

More information

Chapter 5. Partial Equilibrium Analysis of Import Quota Liberalization: The Case of Textile Industry. ISHIDO Hikari. Introduction

Chapter 5. Partial Equilibrium Analysis of Import Quota Liberalization: The Case of Textile Industry. ISHIDO Hikari. Introduction Chapter 5 Partial Equilibrium Analysis of Import Quota Liberalization: The Case of Textile Industry ISHIDO Hikari Introduction World trade in the textile industry is in the process of liberalization. Developing

More information

Analysis of Regional Investment Frameworks Worldwide

Analysis of Regional Investment Frameworks Worldwide Analysis of Regional Investment Frameworks Worldwide Sophie WERNERT Policy analyst Meeting of Working Group 1 MENA-OECD Investment Programme 15-16 February 2010, Amman, Jordan OECD Private Sector Development

More information

Advancing Good Corporate Governance by Promoting Utilization of the OECD Principles of Corporate Governance

Advancing Good Corporate Governance by Promoting Utilization of the OECD Principles of Corporate Governance 011/SOM1/EC/WKSP1/00 Advancing Good Corporate Governance by Promoting Utilization of the OECD Principles of Corporate Governance Submitted by: PECC Workshop on Advancing Good Corporate Governance by Promoting

More information

Japan s New Trade Policy in Asia-Pacific

Japan s New Trade Policy in Asia-Pacific Japan s New Trade Policy in Asia-Pacific August 22, 2013 Shujiro URATA Waseda University 1 Contents I. Japan s Economic Situation II. High Economic Growth and Regional Economic Integration in Asia-Pacific

More information

The Next-Generation Interactive APEC Tariff Database

The Next-Generation Interactive APEC Tariff Database The Next-Generation Interactive APEC Tariff Database A tool to help SMEs access trading markets in Asia Pacific Initiative by USCIB, NC-APEC, US-ASEAN Business Council, TradeMoves LLC & Mercor Consulting

More information

Entrepreneurs, E commerce, and SMEs in APEC

Entrepreneurs, E commerce, and SMEs in APEC Entrepreneurs, E commerce, and SMEs in APEC Dr Chris Hall PECC SME Network Coordinator Session 5 - PECC XIV Hong Kong 29 November 2001 PACIFIC ECONOMIC COOPERATION COUNCIL 1 Key results from the APEC SME

More information

Plurilateralism: A New Way of Trade Liberalism?

Plurilateralism: A New Way of Trade Liberalism? Plurilateralism: A New Way of Trade Liberalism? E-Leader Vienna 6 8 June, 2016 Ludmila Sterbova University of Economics, Prague Historical Background of Trade Liberalism/1 20 th Century 1929-30 Great Depression

More information

Why Corporate Governance is Important in APEC Economies

Why Corporate Governance is Important in APEC Economies 2008/SOM3/EC/WKSP/007 Agenda Item: 2 Why Corporate Governance is Important in APEC Economies Submitted by: Chile Workshop on Corporate Governance Lima, Peru 17 August 2008 Why Corporate Governance is Important

More information

Global Economic Management and Asia s Responsibility Masahiro Kawai Asian Development Bank Institute

Global Economic Management and Asia s Responsibility Masahiro Kawai Asian Development Bank Institute Global Economic Management and Asia s Responsibility Masahiro Kawai Asian Development Bank Institute PECC 18 th General Meeting Economic Crisis and Recovery: Roles for the Asia-Pacific Economies Washington,

More information

Re: Consulting Canadians on a possible Canada-ASEAN Free Trade Agreement

Re: Consulting Canadians on a possible Canada-ASEAN Free Trade Agreement October 16, 2018 Canada ASEAN trade consultations Global Affairs Canada Trade Policy and Negotiations Division (TCA) Lester B. Pearson Building 125 Sussex Drive Ottawa, Ontario K1A 0G2 Via email: CanadaASEAN-ANASE.Consultations@international.gc.ca

More information

AUSTRALIA S POLICIES TOWARDS PROTECTION AND FREE TRADE

AUSTRALIA S POLICIES TOWARDS PROTECTION AND FREE TRADE AUSTRALIA S POLICIES TOWARDS PROTECTION AND FREE TRADE Tim Riley Director Economic Literacy Centre PROTECTION: TARIFFS AND SUBSIDIES Economic Arguments: Protect infant industries Protect employment during

More information

EU Trade Policy and CETA

EU Trade Policy and CETA EU Trade Policy and CETA http://www.youtube.com/watch?v=iioc5xg2i5y The EU a major trading power European Commission, 2013 The EU a major trading power % of global exports, goods, 2012 % of global exports,

More information

ECON CHAPTER. McEachern Micro. International Trade. Designed by Amy McGuire, B-books, Ltd.

ECON CHAPTER. McEachern Micro. International Trade. Designed by Amy McGuire, B-books, Ltd. Designed by Amy McGuire, B-books, Ltd. Micro ECON McEachern 2010-2011 19 CHAPTER International Trade Chapter 19 Copyright 2010 by South-Western, a division of Cengage Learning. All rights reserved 1 The

More information

Economic Impact of Canada s Participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership

Economic Impact of Canada s Participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership Economic Impact of Canada s Participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership Office of the Chief Economist, Global Affairs Canada February 16, 2018 1. Introduction

More information

A world in transition: PwC s 2017 APEC CEO Survey, November APEC CEO Survey. The Philippines findings.

A world in transition: PwC s 2017 APEC CEO Survey, November APEC CEO Survey. The Philippines findings. A world in transition: PwC s 2017 APEC CEO Survey, November 2017 2017 APEC CEO Survey The Philippines findings www.pwc.com/apec Key themes Making of the workforce of the future An operating model for a

More information

A world in transition: PwC s 2017 APEC CEO Survey, November APEC CEO Survey. Malaysia s findings.

A world in transition: PwC s 2017 APEC CEO Survey, November APEC CEO Survey. Malaysia s findings. A world in transition: PwC s 2017 APEC CEO Survey, November 2017 2017 APEC CEO Survey Malaysia s findings www.pwc.com/apec Key themes Making of the workforce of the future An operating model for a fluid

More information

Harnessing Globalisation to Build a Better World for the Benefit of All. Yose Rizal Damuri Centre for Strategic and International Studies

Harnessing Globalisation to Build a Better World for the Benefit of All. Yose Rizal Damuri Centre for Strategic and International Studies Harnessing Globalisation to Build a Better World for the Benefit of All Yose Rizal Damuri Centre for Strategic and International Studies Growing Discontent about Globalisation Dissatisfaction over trade

More information

Is Southeast Asia Still Too Dependent on U.S. Growth? Claire Innes Asia-Pacific Group Global Insight

Is Southeast Asia Still Too Dependent on U.S. Growth? Claire Innes Asia-Pacific Group Global Insight Is Southeast Asia Still Too Dependent on U.S. Growth? Claire Innes Asia-Pacific Group Global Insight Agenda Southeast Asia s growth model A shift to domestic demand-led Growth? The development of an intra-regional

More information

APEC Development Outlook and the Progress of Regional Economic Cooperation and Integration

APEC Development Outlook and the Progress of Regional Economic Cooperation and Integration 2017/FDM1/004 Session: 1 APEC Development Outlook and the Progress of Regional Economic Cooperation and Integration Purpose: Information Submitted by: Asian Development Bank Finance and Central Bank Deputies

More information

Introduction. Institute for International Economics Institute for International Economics

Introduction. Institute for International Economics   Institute for International Economics 1 Introduction Over the past half-century, the United States and South Korea have built a strong and durable partnership that has benefited the economic and security interests of both countries. Under

More information

TPP11 Agreement in Principle: Japan s Role in Mega-regional Trade Agreements

TPP11 Agreement in Principle: Japan s Role in Mega-regional Trade Agreements TPP11 Agreement in Principle: Japan s Role in Mega-regional Trade Agreements December 15, 2017 Shujiro URATA Waseda University Contents Mega-regional FTA Negotiations Japan s objectives behind mega-regional

More information

The Impact of Free Trade Agreements in Asia

The Impact of Free Trade Agreements in Asia RIETI Discussion Paper Series 03-E-018 The Impact of Free Trade Agreements in Asia KAWASAKI Kenichi RIETI The Research Institute of Economy, Trade and Industry http://www.rieti.go.jp/en/ RIETI Discussion

More information

Comments in Response to Executive Order Regarding Trade Agreements Violations and Abuses Docket No. USTR

Comments in Response to Executive Order Regarding Trade Agreements Violations and Abuses Docket No. USTR Comments in Response to Executive Order Regarding Trade Agreements Violations and Abuses Docket No. USTR 2017 0010 Submitted by Business Roundtable July 31, 2017 Business Roundtable is an association of

More information

A world in transition: PwC s 2017 APEC CEO Survey, November APEC CEO Survey. The United States findings.

A world in transition: PwC s 2017 APEC CEO Survey, November APEC CEO Survey. The United States findings. A world in transition: PwC s 2017 APEC CEO Survey, November 2017 2017 APEC CEO Survey The United States findings www.pwc.com/apec Key themes Making of the workforce of the future An operating model for

More information

External Trade. EU TRADE & INVESTMENT POLICY & THE ROLE OF FTAs. ASEAN OECD INVESTMENT POLICY CONFERENCE November 2010

External Trade. EU TRADE & INVESTMENT POLICY & THE ROLE OF FTAs. ASEAN OECD INVESTMENT POLICY CONFERENCE November 2010 EU TRADE & INVESTMENT POLICY & THE ROLE OF FTAs ASEAN OECD INVESTMENT POLICY CONFERENCE 18 19 November 2010 EU INVESTMENT AFTER LISBON LISBON TREATY STEPPING UP EU AMBITIONS: EU Investment policy EU Trade

More information

Japan-ASEAN Comprehensive Economic Partnership

Japan-ASEAN Comprehensive Economic Partnership Japan- Comprehensive Economic Partnership By Dr. Kitti Limskul 1. Introduction The economic cooperation between countries and Japan has been concentrated on trade, investment and official development assistance

More information

2017 APEC CEO Survey Key Findings

2017 APEC CEO Survey Key Findings A world in transition: PwC s 2017 APEC CEO Survey 2017 APEC CEO Survey Key Findings www.pwc.com/apec Key themes Making of the workforce of the future An operating model for a fluid trade policy environment

More information

Regional Integration Arrangements in Economic Development

Regional Integration Arrangements in Economic Development Percy S. Mistry Regional Integration Arrangements in Economic Development Panacea or Pitfall? FONDAD The Hague ISBN: 90-74208-08-8 Copyright 1996 by Percy S. Mistry and the Forum on Debt and Development.

More information

Subject Index. Asian economies: GDP growth rates ( ) ; moves toward economic integration, See also East Asian countries

Subject Index. Asian economies: GDP growth rates ( ) ; moves toward economic integration, See also East Asian countries Subject Index AFTA. See ASEAN Free Trade Area (AFTA) Agricultural sector: protection and liberalization in Mexico, 29-35; protection in NAFTA countries, 52; rice production and marketing in Japan, 380-86,

More information

2010/IEG/WKSP1/002 Overview of IIAs and Treaty-Based Investment Disputes

2010/IEG/WKSP1/002 Overview of IIAs and Treaty-Based Investment Disputes 21/IEG/WKSP1/2 Overview of IIAs and Treaty-Based Investment Disputes Submitted by: UNCTAD Workshop on Dispute Prevention and Preparedness Washington, DC, United States 26-3 July 21 Workshop on dispute

More information

Regional Trade and Economic Integration

Regional Trade and Economic Integration Regional Trade and Economic Integration Analytical Insights and Policy Options Ram Upendra Das Research and Information System for Developing Countries, India Piyadasa Edirisuriya Monash University, Australia

More information

FREE TRADE AGREEMENTS ANALYSIS

FREE TRADE AGREEMENTS ANALYSIS FREE TRADE AGREEMENTS ANALYSIS F R E E T R A D E A G R E E M E N T S I N F O R C E Free Trade Agreement About the Free Trade Agreement ASEAN-Australia-NZ Free Trade Agreement (AANZFTA) The AANZFTA is Australia

More information

Economy Report - China

Economy Report - China 2005/FTA-RTA/WKSP/020 Economy Report - China Submitted by: Ms. Zhao Jie & Mr. Han Yi, China Workshop on Identifying and Addressing Possible Impacts of RTAs/FTAs Development on APEC Developing Member Economies

More information

Facultad de Ciencias Económicas y Empresariales TRABAJO FIN DE GRADO GRADO EN ECONOMÍA INTERNACIONAL. Economic effects of bilateral trade agreements:

Facultad de Ciencias Económicas y Empresariales TRABAJO FIN DE GRADO GRADO EN ECONOMÍA INTERNACIONAL. Economic effects of bilateral trade agreements: Facultad de Ciencias Económicas y Empresariales TRABAJO FIN DE GRADO GRADO EN ECONOMÍA INTERNACIONAL Economic effects of bilateral trade agreements: China, United States, European Union and Japan Marta

More information

A world in transition: PwC s 2017 APEC CEO Survey, November APEC CEO Survey. Australia s findings.

A world in transition: PwC s 2017 APEC CEO Survey, November APEC CEO Survey. Australia s findings. A world in transition: PwC s 2017 APEC CEO Survey, November 2017 2017 APEC CEO Survey Australia s findings www.pwc.com/apec Key themes Making of the workforce of the future An operating model for a fluid

More information

Pharmaceutical Regulatory and Compliance Congress

Pharmaceutical Regulatory and Compliance Congress Pharmaceutical Regulatory and Compliance Congress Dean Forbes, Esq. Director of Corporate Privacy Global Compliance and Business Practices November 16, 2004 1 IPPC What is the IPPC? The International Pharmaceutical

More information

CHAPTER 16 International Trade

CHAPTER 16 International Trade PART 6: INTERNATIONAL ECONOMICS CHAPTER 16 International Trade Slides prepared by Bruno Fullone, George Brown College Copyright 2010 McGraw-Hill Ryerson Limited. 1 In This Chapter You Will Learn Learning

More information

UNITED NATIONS CONFERENCE ON TRADE AND DEVELOPMENT THE POTENTIAL FOR GSTP TRADE EXPANSION. Note prepared by the UNCTAD secretariat

UNITED NATIONS CONFERENCE ON TRADE AND DEVELOPMENT THE POTENTIAL FOR GSTP TRADE EXPANSION. Note prepared by the UNCTAD secretariat Distr. GENERAL UNCTAD/ITCD/TAB/1 27 April 1998 ENGLISH ONLY UNITED NATIONS CONFERENCE ON TRADE AND DEVELOPMENT THE POTENTIAL FOR GSTP TRADE EXPANSION Note prepared by the UNCTAD secretariat The designations

More information

FAQ: Forces in the Global Market

FAQ: Forces in the Global Market Question 1: How did the European Union evolve, and how is it evolving now? Answer 1: The evolution of trade agreements within Europe, commencing with the Treaty of Rome, was a methodical process encompassing

More information

I IB Economics (Groups III and VI): Grade 11

I IB Economics (Groups III and VI): Grade 11 NAME St Maur International School I IB Economics (Groups III and VI): Grade 11 Exam Paper One : Sections A and B Wednesday June 1 st (afternoon) 2016 Time allowed: 90 minutes + 5 minute reading time Recommended

More information

AQA Economics A-level

AQA Economics A-level AQA Economics A-level Macroeconomics Topic 6: The International Economy 6.2 Trade Notes The distinction between absolute and comparative advantage A country has absolute advantage in the production of

More information

RIETI Special Seminar. The New Landscape of World Trade with Mega-FTAs and Japan's Strategy. Handout. URATA Shujiro

RIETI Special Seminar. The New Landscape of World Trade with Mega-FTAs and Japan's Strategy. Handout. URATA Shujiro RIETI Special Seminar The New Landscape of World Trade with Mega-FTAs and Japan's Strategy Handout URATA Shujiro Faculty Fellow, RIETI / Professor of Economics, Graduate School of Asia-Pacific Studies,

More information

Compendium of Auto Taxes in APEC Region

Compendium of Auto Taxes in APEC Region 2018/AD2/016 Agenda Item: 6.1 Compendium of Auto Taxes in APEC Region Purpose: Consideration Submitted by: United States 29th Automotive Dialogue Chiang Rai, Thailand 30-31 October 2018 APEC Motor Vehicle

More information

China s FTA Arrangement with Other Countries and. Its Prospect

China s FTA Arrangement with Other Countries and. Its Prospect Zhang Jianping * National Development and Reform Commission FTA 1 is one of the most important forms of regional trade arrangement in the world. In recent years, it has been developing rapidly as an approach

More information

INTERNATIONAL TRADE. Xie, Yiqing

INTERNATIONAL TRADE. Xie, Yiqing INTERNATIONAL TRADE Xie, Yiqing LECTURE 7 IMPORT TARIFFS AND QUOTA UNDER PERFECT COMPETITION Introduction A Brief History of the World Trade Organization The Gains from Trade Import Tariffs for a Small

More information

Green trade liberalisation - Green Goods Initiative

Green trade liberalisation - Green Goods Initiative Green trade liberalisation - Green Goods Initiative Civil society meeting, 11 June 2014 1. What are green/environmental goods and services? Term used in the Doha Ministerial Declaration/DDA negotiations

More information

The European Union Trade Policy

The European Union Trade Policy The European Union Trade Policy Content 1. The EU in world trade 2. EU trade policy Basic features 3. EU trade policy How it works 4. EU trade policy Competing in the world 5. A renewed strategy for Europe

More information

Rina Oktaviani Bogor Agricultural University, Indonesia

Rina Oktaviani Bogor Agricultural University, Indonesia Dhaka Roundtable on Reviving the Multilateral Trading System: Post-Bali Issues 23 24 November 2014, Bangladesh Session 6 Post-2015 International ti Development Agenda and Multilateral Trading System by

More information

The Rise Of Regionalism In The Multilateral System And Features Of Preferential Trade Agreements In Asia And The Pacific

The Rise Of Regionalism In The Multilateral System And Features Of Preferential Trade Agreements In Asia And The Pacific The Rise Of Regionalism In The Multilateral System And Features Of Preferential Trade Agreements In Asia And The Pacific Enhancing the contribution of PTAs to inclusive and equitable trade: Viet Nam 15-17

More information

No October 2013

No October 2013 DEVELOPING AND TRANSITION ECONOMIES ABSORBED MORE THAN 60 PER CENT OF GLOBAL FDI INFLOWS A RECORD SHARE IN THE FIRST HALF OF 2013 EMBARGO The content of this Monitor must not be quoted or summarized in

More information

Chapter 3. Exploring Global Business

Chapter 3. Exploring Global Business Chapter 3 Exploring Global Business International Business all business activities that involve exchanges across national boundaries. Copyright Cengage Learning. All rights reserved. Chapter 3 Slide 2

More information

The Rise Of Regionalism In The Multilateral System And Features Of Preferential Trade Agreements In Asia And The Pacific

The Rise Of Regionalism In The Multilateral System And Features Of Preferential Trade Agreements In Asia And The Pacific The Rise Of Regionalism In The Multilateral System And Features Of Preferential Trade Agreements In Asia And The Pacific Enhancing the contribution of PTAs to inclusive and equitable trade: Bangladesh

More information

CRS Report for Congress Received through the CRS Web

CRS Report for Congress Received through the CRS Web Order Code RS20755 Updated November 26, 2002 CRS Report for Congress Received through the CRS Web Summary Singapore-U.S. Free Trade Agreement Dick K. Nanto Specialist in Industry and Trade Foreign Affairs,

More information

INTERNATIONAL TAX PLANNING. Singapore Domestic Law And Treaties SHANKER IYER FCA

INTERNATIONAL TAX PLANNING. Singapore Domestic Law And Treaties SHANKER IYER FCA INTERNATIONAL TAX PLANNING Singapore Domestic Law And Treaties SHANKER IYER FCA Contents Singapore Tax System Corporate & personal Recent tax developments What makes Singapore an attractive centre for

More information

ASIA IN THE WORLD ECONOMY: THREE POLICY CHALLENGES

ASIA IN THE WORLD ECONOMY: THREE POLICY CHALLENGES ASIA IN THE WORLD ECONOMY: THREE POLICY CHALLENGES Razeen Sally EFN ASIA CONFERENCE 2012 Hong Kong, 7 th November 2112 ASIA IN THE WORLD ECONOMY Setting the scene - Shift to the East, accelerated by the

More information

CASE FAIR OSTER. International Trade, Comparative Advantage, and Protectionism. Trade Surpluses and Deficits

CASE FAIR OSTER. International Trade, Comparative Advantage, and Protectionism. Trade Surpluses and Deficits PEARSON PRINCIPLES OF MICROECONOMICS E L E V E N T H E D I T I O N CASE FAIR OSTER Prepared by: Fernando Quijano w/shelly Tefft 2of 49 PART IV THE WORLD ECONOMY International Trade, Comparative Advantage,

More information

Beyond the Uruguay Round

Beyond the Uruguay Round Public Disclosure Authorized POLICY RESEARCH WORKING PAPER 1467 Public Disclosure Authorized Public Disclosure Authorized Beyond the Uruguay Round The Implications of an Asian Free Trade Area Jeffrey D.

More information

Asia and the Pacific: Economic Outlook and Drivers

Asia and the Pacific: Economic Outlook and Drivers 2018/FDM1/004 Session 2.1 Asia and the Pacific: Economic Outlook and Drivers Purpose: Information Submitted by: International Monetary Fund Finance and Central Bank Deputies Meeting Port Moresby, Papua

More information

Presentation by Economy Under Review - Chile

Presentation by Economy Under Review - Chile 2008/SOM3/013anx3 Agenda Item: IV Presentation by Economy Under Review - Chile Purpose: Consideration Submitted by: APEC Secretariat Third Senior Officials Meeting Lima, Peru 22-23 August 2008 CHILE IAP

More information

TPP, RCEP and Prospects for Eventual Convergence Robert Scollay NZPECC and APEC Study Centre, University of Auckland

TPP, RCEP and Prospects for Eventual Convergence Robert Scollay NZPECC and APEC Study Centre, University of Auckland , and Prospects for Eventual Convergence Robert Scollay NZPECC and APEC Study Centre, University of Auckland presentation at symposium on New Development and Future Direction of Asia Pacific Regional Economic

More information

Japan s FTA Strategy. August 7, Shujiro URATA Waseda University

Japan s FTA Strategy. August 7, Shujiro URATA Waseda University Japan s FTA Strategy August 7, 2014 Shujiro URATA Waseda University 1 Contents I. Japan s Economic Situation II. High Economic Growth and Regional Economic Integration in Asia-Pacific III. Japan s New

More information

2. LEGAL FRAMEWORK (1) EXISTING GATT/WTO PROVISIONS ON RTAS

2. LEGAL FRAMEWORK (1) EXISTING GATT/WTO PROVISIONS ON RTAS CHAPTER 16 Chapter 16: Regional Integration REGIONAL INTEGRATION OVERVIEW OF RULES 1. BACKGROUND OF RULES The multilateral framework based on the GATT/WTO and IMF systems has sustained the world economy

More information

ANALYSIS OF JAPAN S EXISTING AND FORTHCOMING FREE TRADE AGREEMENTS IN THE ASIA PACIFIC AND GLOBAL CONTEXT

ANALYSIS OF JAPAN S EXISTING AND FORTHCOMING FREE TRADE AGREEMENTS IN THE ASIA PACIFIC AND GLOBAL CONTEXT 30 Analysis of Japan s existing and forthcoming free trade agreements in the Asia ANALYSIS OF JAPAN S EXISTING AND FORTHCOMING FREE TRADE AGREEMENTS IN THE ASIA PACIFIC AND GLOBAL CONTEXT Florin Bonciu

More information

Volume Author/Editor: Takatoshi Ito and Anne O. Krueger, Eds. Volume URL:

Volume Author/Editor: Takatoshi Ito and Anne O. Krueger, Eds. Volume URL: This PDF is a selection from an out-of-print volume from the National Bureau of Economic Research Volume Title: Regionalism versus Multilateral Trade Arrangements, NBER-EASE Volume 6 Volume Author/Editor:

More information

Services Trade: Essential Fuel for U.S. and Global Economic Growth

Services Trade: Essential Fuel for U.S. and Global Economic Growth Services Trade: Essential Fuel for U.S. and Global Economic Growth CHRISTINE BLISS, PRESIDENT, THE COALITION OF SERVICES INDUSTRIES SERVICESCOALITION.ORG The Role of Services in the U.S. Economy The United

More information

2007/SOM2/IEG-GOS/WKSP/002a Services in International Investment Agreements (IIA) - Presentation

2007/SOM2/IEG-GOS/WKSP/002a Services in International Investment Agreements (IIA) - Presentation 2007/SOM2/IEG-GOS/WKSP/002a Services in International Investment Agreements (IIA) - Presentation Purpose: Information Submitted by: Workshop on the Relationship Between Investment and Trade in Services

More information

Session 1 : Economic Integration in Asia: Recent trends Session 2 : Winners and losers in economic integration: Discussion

Session 1 : Economic Integration in Asia: Recent trends Session 2 : Winners and losers in economic integration: Discussion Session 1 : 09.00-10.30 Economic Integration in Asia: Recent trends Session 2 : 11.00-12.00 Winners and losers in economic integration: Discussion Session 3 : 12.30-14.00 The Impact of Economic Integration

More information

The Importance of CJK FTA for the Development of Trilateral Cooperation

The Importance of CJK FTA for the Development of Trilateral Cooperation The Importance of CJK FTA for the Development of Trilateral Cooperation April 7, 2016 Chang Jae LEE Korea Institute for International Economic Policy Contents I. Brief history of CJK FTA II. Reasons why

More information

On the Comparison of Safeguard Mechanisms of FTAs

On the Comparison of Safeguard Mechanisms of FTAs 2006.3.22 RIETI On the Comparison of Safeguard Mechanisms of FTAs Akira Kotera University of Tokyo Tomofumi KITAMURA University of Tokyo GATT XIX -What is Safeguard?- If, as a result of unforeseen developments

More information

Impacts of East Asian Integration on Vietnam: A CGE Analysis

Impacts of East Asian Integration on Vietnam: A CGE Analysis Impacts of East Asian Integration on Vietnam: A CGE Analysis Nguyen Tien Dung Lecturer, Faculty of International Economics College of Economics, Vietnam National University, Hanoi Abstract: Through liberalization

More information

Economic Outlook and Risks in the APEC Region

Economic Outlook and Risks in the APEC Region 2018/FMM/002 Agenda Item: 1.1 Economic Outlook and Risks in the APEC Region Purpose: Information Submitted by: ADB 25th Finance Ministers Meeting Port Moresby, Papua New Guinea 17 October 2018 Economic

More information

Click here to advance to the next slide.

Click here to advance to the next slide. Click here to advance to the next slide. Chapter 10 Business in a Global Economy Section 10.1 The Global Marketplace Read to Learn Explain why the world has become a global economy. Explain why people

More information

APEC, East Asia Consortium and Global Imbalance

APEC, East Asia Consortium and Global Imbalance APEC, East Asia Consortium and Global Imbalance --for US-JI Symposium 2010 Xiaopeng Yin UIBE, China Presentation Outline 1. Proposed Role and Current Status of APEC Economic integration and regional co-op

More information

Moving towards a Common External Tariff Regime in ASEAN. Draft Final Report

Moving towards a Common External Tariff Regime in ASEAN. Draft Final Report Capacity Building for the ASEAN Secretariat: Common External Tariff Regime ASEAN E06/08 Moving towards a Common External Tariff Regime in ASEAN Draft Final Report Submitted to InWEnt International Weiterbidung

More information

International Economics

International Economics International Economics Unit 5 Pretest As we learn about International Economics, let s see what you already know. Remember do the best you can, but don t stress this assessment doesn t count toward your

More information

Reviewing the Importance. for Indonesia

Reviewing the Importance. for Indonesia Review of Indonesian Economic Policies Reviewing the Importance of Free Trade Agreements for Indonesia Yose Rizal Damuri This policy brief is the result of an activity entitled Economic Policymaking in

More information

SETTLEMENT OF DISPUTES

SETTLEMENT OF DISPUTES Chapter 8 SETTLEMENT OF DISPUTES BETWEEN STATES, IMPROVEMENT OF BUSINESS ENVIRONMENT Settlement of Disputes between States Background of the Rules Regional trade agreements, including free trade agreements

More information

CASE FAIR OSTER PRINCIPLES OF MICROECONOMICS E L E V E N T H E D I T I O N. PEARSON 2014 Pearson Education, Inc.

CASE FAIR OSTER PRINCIPLES OF MICROECONOMICS E L E V E N T H E D I T I O N. PEARSON 2014 Pearson Education, Inc. PRINCIPLES OF MICROECONOMICS E L E V E N T H E D I T I O N CASE FAIR OSTER PEARSON Prepared by: Fernando Quijano w/shelly 1 of Tefft 31 2 of 31 PART IV THE WORLD ECONOMY International Trade, Comparative

More information

Economic Impact of Canada s Potential Participation in the Trans-Pacific Partnership Agreement

Economic Impact of Canada s Potential Participation in the Trans-Pacific Partnership Agreement Economic Impact of Canada s Potential Participation in the Trans-Pacific Partnership Agreement Office of the Chief Economist Show table of contents 1. Introduction The Trans-Pacific Partnership Agreement

More information

Appendix A Specification of the Global Recursive Dynamic Computable General Equilibrium Model

Appendix A Specification of the Global Recursive Dynamic Computable General Equilibrium Model Appendix A Specification of the Global Recursive Dynamic Computable General Equilibrium Model The model is an extension of the computable general equilibrium (CGE) models used in China WTO accession studies

More information

Course Economics and Business Management Prof. Dr. Marius Dannenberg. Chapter 3 Markets and Government in the Global Economy

Course Economics and Business Management Prof. Dr. Marius Dannenberg. Chapter 3 Markets and Government in the Global Economy Course Economics and Business Management Prof. Dr. Marius Dannenberg Chapter 3 Markets and Government in the Global Economy Syllabus: Economics and Business Management Chapter 1 Introduction Understanding

More information

Asia-Pacific Trade Briefs: Hong Kong, China

Asia-Pacific Trade Briefs: Hong Kong, China i Asia-Pacific Trade Briefs: Hong Kong, China Merchandise Trade Hong Kong, China has a trade-to-gdp ratio of 386.95%. Merchandise trade accounted for 86.3% of Hong Kong, China's total trade in 2017. Hong

More information

Comment on Masaki Kuwahara A Search for Potential Female Labor Forces in Japan s Aging Society Challenges for Prime Minister Yukio Hatoyama

Comment on Masaki Kuwahara A Search for Potential Female Labor Forces in Japan s Aging Society Challenges for Prime Minister Yukio Hatoyama Comment on Masaki Kuwahara A Search for Potential Female Labor Forces in Japan s Aging Society Challenges for Prime Minister Yukio Hatoyama Masahiro Kawai, ADBI Macroeconomy Research Conference Beyond

More information

Asian Insights Third quarter 2016 Asia s commitment in policies and reforms

Asian Insights Third quarter 2016 Asia s commitment in policies and reforms Asian Insights Third quarter 2016 Asia s commitment in policies and reforms One of the commonalities between most Asian governments is the dedicated commitment they have in using policies and initiatives

More information

Environmental Goods Agreement (EGA) negotiations Civil Society Dialogue meeting 13 September 2016

Environmental Goods Agreement (EGA) negotiations Civil Society Dialogue meeting 13 September 2016 Environmental Goods Agreement (EGA) negotiations Civil Society Dialogue meeting 13 September 2016 Disclaimer: All images and photographs in this presentation are used purely for purposes of demonstration

More information

Department of Foreign Affairs and Trade

Department of Foreign Affairs and Trade Department of Foreign Affairs and Trade P4 (Chile, Singapore, New Zealand and Brunei) Negotiations commence in 2002 Trans-Pacific Strategic Economic Partnership (P4) enters into force in 2006 Negotiations

More information

Event 1. Module 2. The Converging Strands Between Trade and Investment Session Two: The mega regionals, impacts for members and non-members

Event 1. Module 2. The Converging Strands Between Trade and Investment Session Two: The mega regionals, impacts for members and non-members Event 1. Module 2. The Converging Strands Between Trade and Investment Session Two: The mega regionals, impacts for members and non-members The different mega-regionals: groupings, agendas, contents and

More information

2016/MRT/012 Session 3

2016/MRT/012 Session 3 2016/MRT/012 Session 3 2016 APEC Economy Progress in Implementing Their Commitments to Reduce Tariffs on the 54 Products in the APEC List of Environmental Goods to Five Per Cent or Less by the End of 2015

More information

Can Regionalism Work? Caroline Freund

Can Regionalism Work? Caroline Freund Can Regionalism Work? Caroline Freund Number of PTAs Evolution of PTAs Why Do Countries Impose Trade Barriers? Economists agree free trade is best. Why have trade barriers? To raise revenue. To protect

More information

ANNUAL SESSION OF THE PARLIAMENTARY CONFERENCE ON THE WTO Geneva, 1-2 December 2006

ANNUAL SESSION OF THE PARLIAMENTARY CONFERENCE ON THE WTO Geneva, 1-2 December 2006 ANNUAL SESSION OF THE PARLIAMENTARY CONFERENCE ON THE WTO Geneva, 1-2 December 2006 Organized jointly by the Inter-Parliamentary Union and the European Parliament Item 3(b) PC-WTO/2006/3(b)-R.1 27 October

More information

EFTA FREE TRADE RELATIONS

EFTA FREE TRADE RELATIONS EFTA FREE TRADE RELATIONS Relations with the rest of the world Brussels, Monday 4 December 2017 By Martin Zbinden, Deputy Secretary-General, EFTA Secretariat Agenda EFTA free trade network The EFTA FTA

More information

Economic Integration in South East Asia and the Impact on the EU

Economic Integration in South East Asia and the Impact on the EU Economic Integration in South East Asia and the Impact on the EU Contents Executive summary... 4 1. Introduction... Error! Bookmark not defined. 2. Introduction to State of Economic Integration in South

More information

CFRED The Trans Pacific Partnership Impact and Implications. Assessing the content from a business perspective

CFRED The Trans Pacific Partnership Impact and Implications. Assessing the content from a business perspective CFRED The Trans Pacific Partnership Impact and Implications. Assessing the content from a business perspective 1 M I C H A E L M U D D S E C R E TA R Y G E N E R A L, A PA C T H E O P E N C O M P U T I

More information