Shaping Agricultural Imports: The Roles of Tariffs and Non‐Tariff Changes of China's RTAs

Coinciding with the era of globalisation, there has been a rise in the number and depth of Regional Trade Agreements (RTAs) in the Asian region. As India has also been a part of this growing trend, this paper attempt to identify the determinants of India’s exports with special focus on the role of globalisation and RTAs of India. We employ panel data regression on an augmented gravity model to examine the effects of these variables. To capture the globalisation effect, we have included trade openness of the host country. For RTAs, we have taken two variables; one which indicates the presence or absence of an RTA in a given year; and second is the number of RTAs between India and its partner country. Using data for nine countries which are India’s trading partners over the period 1991-2012, we find that GDP and GDP per capita of the host country are significant determinants of India’s exports. Trade openness which is an indicator of globalisation is positive and highly significant indicating that trade openness of the partner country has resulted in increased Indian exports to that country. Of the two variables capturing the impact of RTAs, the variable defining the number of RTAs negotiated with trading partners is positive and significant. The results show that while presence of an RTA may have a positive impact on Indian exports, they are still not a prime consideration. At the same time, the width of integration is having a significant positive impact on India’s export.

The number of Regional Trade Agreements (RTAs) between countries has significantly increased over the past few decades. RTA may include rights and obligations that are parallel to those of WTO agreement, and provide for its own dispute settlement mechanism that is different from WTO Dispute Settlement Understanding (DSU). This forum clause allows parties to both RTA and WTO to litigate their dispute outside the DSU. This article addresses the issue of jurisdictional conflict between the RTAs and the WTO dispute mechanism over a claim that is violative of both WTO and RTA’s obligations. The main question this article answers is whether it is possible for the forum clause incorporated in RTA to divest the jurisdiction of WTO if invoked during the proceeding. This article analyzes a number of cases and RTAs involving a choice of forum clause before the WTO panel. This paper proceeds to examine different legal principles to find a legal justification to reconcile the jurisdictional scope of both RTA and WTO. As in current international legal principles do not offer an effective solution, this paper suggests that DSU should be amended to provide a set of rules governing the conflict between the RTA and WTO jurisdictions.

Since the establishment of the World Trade Organization (WTO) also the number of Regional Trade Agreements (RTAs) has risen strongly, from less than 50 in 1995 to more than 350 in 2022. Increasingly overlapping RTAs imply challenges and can raise trade costs associated with the management of multiple trade rules and regulatory standards. At the same time, countries that are connected through several RTAs could be strongly integrated and their regulatory approaches well-aligned, thus reducing trade costs among them. This paper looks at the parallels in the evolution of agricultural trade and RTAs and asks how the layering of RTAs is associated with agricultural trade among their signatories and with countries outside the RTAs. Based on network measures and correlations we identify common patterns in the evolution of RTAs globally and agricultural trade of a balanced panel of 190 countries in the years 1995, 2007, 2013 and 2019. We also provide first indication on the interaction of overlapping RTAs and agricultural trade. On global average, our findings hint at a positive association between RTA and agricultural trade connectivity and suggest that this relationship could be more pronounced at the extensive margin of trade and for countries that share several RTAs, possibly indicating a stronger political integration among these countries.

This paper examines the provisions on antidumping, countervailing duties and safeguards in seventy-four regional trade agreements (RTAs). A number of RTAs have succeeded in abolishing contingent protection measures. In addition, about half of RTAs have adopted RTA-specific rules that tighten discipline on the application of contingent protection measures on RTA members. This is most especially the case for antidumping. There is less of an impact for countervailing duty; this is likely due to the fact that the economic impact of subsidies is global and also to the absence of commitments in RTAs on meaningful curbs on subsidies or state aid. It is very difficult to offer a simple summary characterization of the provisions in RTAs. RTAs vary in size, degree of integration, geographic scope, and the level of economic development of their members. Contingent protection provisions vary greatly from one RTA to the next. In fact, contingent protection provisions differ for the same country across different RTAs. Some RTAs have additional rules; some have no rules, and other prohibit the use of these actions. Even if we focus just on the RTAs that incorporate additional rules it is hard to characterize what happens; there is no consensus set of provisions that are found in all (or even most) RTAs. The results of the mappings suggest the need to be vigilant about increased discrimination arising from trade remedy rules in RTAs. If nothing else, the complicated pattern of inclusion of these provisions threatens the delicate “give and take” balancing of incentives that is at the crux of the GATT/WTO agreements. An ongoing policy concern is that the elastic and selective nature of trade remedies may lead to more discrimination, with reduced trade remedy actions against RTA partners, but a greater frequency of trade remedy actions against non-members. The adoption of RTA-specific trade remedy rules increases this risk of discrimination, with trade remedies against RTA members being abolished outright or being subjected to greater discipline. In turn, this makes it more difficult for nonRTA members to agree to WTO liberalization as the requisite quid-pro-quo from RTA members may not be realized. Said differently, RTAs may erode the market access that non-members thought they had secured in prior WTO rounds, not primarily because of the discriminatory tariffs but rather because of contingent protection rules.

Purpose The trade-enhancing effect of regional trade agreements (RTAs) has been proved by many studies, while the differential roles of tariffs and non-tariff changes in RTAs have received little attention. This paper attempts to explore the source of trade effects of RTAs. Design/methodology/approach This paper focuses on 12 RTAs signed by China and decomposes the trade effect of RTAs into tariff and non-tariff effects using a structural gravity model. We further examine the heterogeneous effects of the two measures at national and product levels. Findings This research finds that (1) though RTAs have promoted China’s agricultural exports overall, non-tariff changes of RTAs show a negative effect; (2) tariff changes have a more significant promoting effect on China’s exports to developing countries than to developed countries, but non-tariff changes also have a significant opposite effect on the exports to these countries and (3) the trade effects of tariff changes do not exhibit significant heterogeneity at the product level, while non-tariff changes significantly hinder exports of agricultural products that China has comparative advantages in. Research limitations/implications Since only 12 RTAs signed by China are considered, although this could reflect the trade effects of tariffs and non-tariff changes of RTAs signed by developing countries, we believe it would be more interesting and meaningful to carry out further work on its impact on developed countries’ agricultural exports and compare it with the result of developing countries. We leave this comparison for future studies. Practical implications It is suggested that member countries should pay more attention to non-tariff changes and reach deeper RTAs to achieve a more transparent trading environment. And it is crucial to evaluate the effect of the RTAs and solve trade barriers timely. Originality/value The number of RTAs has been increasing. However, non-tariff barriers (NTBs) have also risen during the past 20 years. The question “What roles are tariffs and non-tariff changes of RTAs playing respectively” has yet to be answered. Decomposing the trade effects of RTAs and exploring the source of their trade effects help us better understand and utilize trade policy tools.

Purpose The global trading environment has experienced a significant transformation with the establishment of the World Trade Organization (WTO) and the growing prevalence of Regional Trade Agreements (RTAs). In line with this global trend, China, which joined the WTO in 2001, had signed 16 RTAs with 24 countries and regions by 2018. Furthermore, in 2013, the Chinese government launched the Belt and Road Initiative (BRI), aimed at fostering regional integration and economic growth through extensive infrastructure projects and trade liberalization agreements (Huang, 2016; Zhao et al., 2024). Despite growing global integration, trade continues to be shaped by border effects – the restrictive impact of national and geographic boundaries on trade flows, particularly in the sensitive agricultural sector. To explore this issue, this study analyzes how border effects shape China’s agricultural trade and examines the impact of RTAs and the BRI on trade dynamics. Design/methodology/approach This study employs a gravity model to examine the impact of border effects on agricultural trade between China and its 36 trading partners, including Brazil, Japan, South Korea, the European Union and the United States, over the period from 2001 to 2018. Findings The results indicate that China’s border effects on agricultural imports and exports are asymmetric, with import border effects being larger than export border effects. From 2002 to 2018, these border effects have generally declined, reflecting reduced trade frictions and deeper integration into the global market. Additionally, country-specific border effects reveal that the greater a country’s reliance on agricultural imports from its trading partner, the lower its border barriers tend to be. While RTAs and the BRI have positively influenced trade, the persistently high border effects observed in some participating countries suggest that factors beyond trade agreements play a crucial role in shaping trade barriers. Originality/value Asymmetric border effects underscore the need for a country-specific policy approach that effectively addresses these disparities. To further reduce border effects and foster trade, efforts should focus not only on lowering tariff and non-tariff barriers through policy factors but also on addressing non-policy factors such as home bias, which can hinder cross-border trade expansion.

ABSTRACTFew papers have investigated the trade effects of multi-memberships of Regional Trade Agreements (RTAs), but none has done this in an Africa-wide manner. This paper investigates the supplementary trade effects of multi-memberships of RTAs after controlling for single-membership for all African RTAs. We use (1) overall number of RTAs by country pair; (2) dummies of number of RTAs; and (3) number of RTA memberships by countries within each RTA grouping, in a panel of 53 African countries from 1995 to 2014. The gravity models are estimated with the Eicker-White robust covariance Poisson Pseudo-Maximum Likelihood (PPML) which is superior to previous ones. All the estimates concur that multi-memberships have significant additional intra-Africa trade benefits which increase with the number of memberships. The implication is that although RTAs enhance trade in Africa, it is only a second-best to a complete integration of the African continent. A complete dismantling of politically induced trade barriers and even inter-RTA boundaries within Africa will yield significant intra-Africa trade benefits. The results support the ongoing efforts in Africa in pursuing a “one Africa” vision. Such efforts have to transcend regional integration and pursue the ideal of an integrated Africa for the full trade benefits to be realized.

The number of regional trade agreements (RTAs) between countries has significantly increased over the past few decades. RTAs may include rights and obligations that are parallel to those of the Agreement Establishing the World Trade Organization 1994 (Marrakesh Agreement). They may also provide for their own dispute settlement mechanism that is different from the WTO Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU). This forum clause allows parties to both RTAs and the WTO to litigate their dispute outside the DSU. This article addresses the issue of jurisdictional conflict between the RTAs and the WTO dispute mechanism over a claim that is violative of both the WTO’s and RTA’s obligations. The main question this article answers is whether it is possible for the forum clause incorporated in RTAs to divest the jurisdiction of the WTO if invoked during the proceeding. This article analyses several cases and RTAs involving a choice of forum clause before the WTO panel. This paper examines different legal principles to find a legal justification to reconcile the jurisdictional scope of both RTAs and the WTO agreements. As current international legal principles do not offer an effective solution, this paper suggests that the DSU should be amended to provide a set of rules governing the conflict between the RTAs and WTO jurisdictions.

Is there more to regional trade agreements than the traditional gains from trade? The past decade has witnessed an explosion in the number of regional trade agreements. There seems to be a general, if ill-defined, belief on the part of many policymakers and academics that there is more to such agreements than the traditional gains from trade (thus the term new regionalism). Fernandez examines several possible benefits that regional trade agreements may confer on their partners, including credibility, signaling, bargaining power, insurance, and a mechanism for coordination. She assesses the conditions necessary for each of these benefits, gives stylized examples of policies that might bring about those conditions, and discusses the plausibility of those conditions existing. In this light, she examines the North American Free Trade Agreement (NAFTA) and the European association agreements between the European Union and the countries in Central and Eastern Europe. She concludes that regional trade agreements can serve a useful economic purpose beyond the direct gains from trade liberalization, by reducing uncertainties and improving credibility and thus making it easier for the private sector to plan and invest. Indeed, reducing uncertainty may be essential for realizing gains from liberalization. Whether economies benefit from a particular regional trade agreements depends on the scope and coverage of its provisions, the nature of the enforcement mechanism, the circumstances in which the agreement can be amended, and changes in the behavioral incentives for various agents in the economy that result from it. It is important to examine these factors carefully and to evaluate the feasibility of freer trade in their absence when determining the effects of regional trade agreements on world welfare. This paper - a product of the International Trade Division, International Economics Department - is part of the division's Program on Regionalism and Development.

An increasing number of regional trade agreements contains provisions that ease access to visas among member countries, which reduces the administrative cost of crossing the border. Combining United Nations data on bilateral stocks of immigrants in the period 1990–2020 with World Bank data on the content of 279 regional trade agreements, this article presents robust evidence of a positive effect of visa provisions in regional trade agreements on bilateral migration: the presence of visa provisions in regional trade agreements increases the bilateral stock of immigrants by 5.8 per cent. This result is robust to an instrumental variable strategy addressing the endogeneity problem. The effect of the inclusion of visa provisions in regional trade agreements is particularly effective among country pairs with different income levels (such as North-South). For this type of country pairs, the presence of visa provisions in regional trade agreements increases the bilateral stock of immigrants by 12.7 per cent. Finally, the article shows that the effectiveness of visa provisions in regional trade agreements reduces with the anti-immigration sentiment of voters in the destination.

East Asia is steadfastly marching towards regional economic integration through a number of regional trade agreements (RTAs) and China is a major driving force behind this movement. This paper analyses China's RTAs and their impact on regionalism in Asia. It addresses the criticisms that China's RTAs are politically but not economically driven, that China's RTAs create the hub‐and‐spoke bilateralism and that China's RTAs are not World Trade Organization consistent. It discusses China's position on East Asian regionalism, pointing out that China wishes East Asia to pursue regionalism on multi‐track and at multi‐speed, that China tends to ‘do easy things first’ with low integration and liberalisation and then gradually move to deeper liberalisation and integration and that China's definition of ‘open regionalism’ does not include outside countries such as the USA and the EU. The paper makes suggestions for improving China's RTAs in the interest of establishing an East Asia free trade agreement.

It is indicated that one of the characteristic features of the modern trade system is the rapid growth of the number of regional trade agreements, which, in turn, causes asymmetry in the dominance of regional cross-border trade rules over multilateral ones. The main advantages for countries from participating in regional trade agreements have been identified: the possibility of excluding "vulnerable sectors" from the agreement; the ability to independently choose partners in negotiations; the use of the principle of "reciprocity" is more effective compared to the World Trade Organization, the possibility of forming the image of a regional leader; within the framework of such agreements, it is possible to carry out "experimental application" of certain new measures in the field of trade, which, if successfully tested, can be tried to be applied in general mode; the possibility of attracting more foreign investments by developing countries that are not regional leaders. After examining the degree of involvement of countries in concluding regional trade agreements for the presence of regional asymmetries, a significant difference was identified from the maximum involvement of the countries of the European region (on average 33.2 agreements per country) and the countries of Africa (2.7) and the Middle East (3.9). It is proposed that one of the vectors of the development of Ukraine's foreign economic policy should be the expansion of the scope of current and future regional trade agreements to the sphere of services, e-commerce and investments, given the potential, their compliance with the global trends of the trading system, as well as the ability of Ukraine to become a significant player in a number of markets for services and trade in digital products, taking into account the availability of an up-to-date legal framework on these issues. It was determined that 50% of Ukraine's commodity exports during 2016-2021 took place within the framework of the preferential regime provided for by key free trade agreements. According to the results of the proposed forecast of such exports for the period 2021-2023, using the method of time series analysis, it was confirmed that the corresponding dependence will only grow (export volumes within the framework of free trade agreements will grow by 3 percent annually, while total exports by 2%).

Regional trade agreements have increasingly become important as a medium for effecting trade liberalization. The trend is not expected to recede. There is not to suggest that multilateral trading system under the WTO has to be relegated. Regional trade agreements may be a good avenue to pursue market access reforms, but they do have an obvious limitation in making a foray into rule-making. They rely rather heavily on multilateral trade rules and on the expectation that these fundamental trade rules are implemented so as to build upon them within the preferential setting. This is evident when one looks at the treatment of subsidies, regulatory measures, safeguards and other trade remedy instruments within these regional trade agreements. This article examines the situation of exports and imports in ten major agricultural trading countries or territories to assess the share of preferential trade in the overall trade profile. While the situation varies across the group, a significant share of trade continues to originate in or destined for countries under (MFN) Most-favoured Nation terms. In a number of regional trade agreements, including those involving the ten major countries, various sensitive agricultural sectors like dairy, meats, sugar, cereals have either been exempted from tariff elimination or preferential tariff treatment has been offered through a minor reduction in high MFN tariffs or tariff rate quotas. Tariff reforms for a number of such sensitive agriculture sectors have proven to be difficult partly because of the linkage between tariff policies and governmental internal policies and subsidies granted to such sensitive sectors. This linkage hinders commitments on tariff liberalization for the relevant sensitive sectors, especially in a preferential setting where domestic subsidy reforms might not be feasible. In order to exploit the synergy between regional trade agreements and the multilateral trading system and negotiations, it has been suggested in this article to consider reforms of sensitive agricultural sectors within the multilateral negotiations where both tariff liberalization and subsidy reforms may be pursued together.

Purpose - The purpose of this research is to examine how regional trade agreements are being utilized as alternative means to achieve digital trade liberalization, and whether digital trade-related provisions of regional trade agreements can be generalized as global rules for digital trade liberalization. Design/methodology/approach - To analyze the relationship between digital trade liberalization and regional trade agreements, this paper uses literature research and investigates the statistics and agreement documents in the WTO RTA database. In addition, it proposes alternatives to address the limitations of digital trade liberalization through regional trade agreements. Findings - The results of this study can be summarized as follows: First, the number of regional trade agreements that include digital trade-related provisions is steadily increasing. Regional trade agreements are used as an alternative means to achieve the liberalization of digital trade, and provide international standards for establishing digital trade rules. Second, Regional trade agreements have problems such as discrimination against non-member countries, spaghetti-bowl phenomenon, and these problems can be an obstacle to the development of digital trade. Thus, measures should be taken to address these limitations of regional trade agreements so that global digital trade liberalization can be achieved. Research implications or Originality – Regarding the liberalization of digital trade, Korea should also actively participate in international discussions related to digital trade, and improve the domestic systems that meets international standards.

Recently, the number of regional trade agreements (RTAs) has flourished and at the same time, trade disputes are increasing. The dispute settlement mechanisms (DSMs) in those RTAs may be potentially at odds with the DSM of the World Trade Organization (WTO), the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU). The interaction between the DSMs of the WTO and in RTAs raise various concerns, including forum shopping and conflicts of jurisdiction. The key question is: which DSM should prevail? The relationship between the DSU and the default DSM in the North American Free Trade Agreement (NAFTA) provides an example of such an interaction and illustrates the potential fragmentation in case of overlapping jurisdiction. In the Mexico – Tax Measures on Soft Drinks and Other Beverages case, the WTO’s Appellate Body was reluctant to adopt a straightforward position on such overlaps. Thus, at least for now, there are many open questions, but no clear-cut answers. After providing an overview of the legal framework and discussing this important case, the authors propose solutions as to how to deal with jurisdictional overlaps in trade disputes. World Trade Organization (WTO), Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU), Mexico – Soft Drinks, regional trade agreements (RTA), North American Free Trade Agreement (NAFTA), dispute settlement mechanisms, jurisdiction, proliferation, multiplication, international courts and tribunals