Liberalization Of Trade In Goods Research Articles

REGIONAL COMPREHENSIVE ECONOMIC PARTNERSHIP: REGULATION OF FOREIGN TRADE

The world's largest free trade area in terms of GDP and population – the Comprehensive Regional Economic Partnership (CEP) – has been operating since January 2022. It includes 15 countries of the Asia-Pacific region: China, Japan, the Republic of Korea, all ASEAN countries, Australia and New Zealand. The main agreements within the framework of the VREP relate to the liberalization of foreign trade in goods with the prospect of liberalizing the services market, mutual investments and labor market regulation. The VREP maintains import tariffs in trade between member countries for 20 years. The exception is Singapore, where there are no import duties. The agreement details the procedures for determining the origin of the goods. It provides for an acceleration in the rate of tariff reduction and a departure to previously reached agreements in the case if the existing level threatens the interests of the national economy. The article considers the specifics of regulating tariff policy in the trade of fuel, ferrous metals and clothing, as well as import tariffs on basic foodstuff (cereals and meat) for the most densely populated countries of the European Economic Area. It is noted that import tariffs are absent or reduced for raw materials (coal, oil), but remain the same for manufacturing products (petroleum products, rolled products and ferroalloys). In terms of clothing, both developing and developed countries defend certain positions. There are positions on food (rice, chicken meat) protected by most member countries. The author notes that the interests of food security are more important than the requirements of trade liberalization.

The impact of capital goods trade liberalization on regional labor market in China

The impact of trade liberalization on regional employment dynamics remains a topic of ongoing debate and scrutiny. This study aims to provide a nuanced understanding by focusing specifically on the effects of imported capital goods trade. Our study analysis reveals that capital goods trade liberalization predominantly leads to a substitution effect between capital and labor, resulting in a reduction in overall regional employment levels. However, we also find complementary effects between capital and high-skilled labor, alongside substitution effects on low-skilled labor, which collectively influence the regional labor market's skill structure. Furthermore, our study identifies the heterogeneous spillover effects of capital goods trade liberalization on regional labor markets, varying across different regions and city scales. We argue that investing in region skill development resources can help align the workforce with global factors, fostering positive interaction between regions.

Impact of the Deep and Comprehensive Free Trade Zone on the Economic Development of the Republic of Moldova

The Republic of Moldova, being a state with a small economy, has considerably diversified its sales markets, focusing primarily on the European Union market, which currently absorbs more than half of its exports. The present study tries to highlight the benefits of the Association Agreement and the Deep and Comprehensive Free Trade Area (DCFTA) implementation, which contributes to increasing the competitiveness of domestic companies on European markets and the liberalization of trade in goods and services. In conclusion, some measures are highlighted that are necessary to be implemented by the Republic of Moldova, in order to ensure the economy reorientation towards export by diversifying both the geographical structure and products in particular, improving commercial policy regulations, product quality, attracting investments foreign direct, the elimination of corruption.

New-generation trade agreement with Japan: Significance to EU Companies

Objective: The New-generation trade agreements, which include the agreement with Japan, provide wide coverage – not only the liberalisation of trade in goods or services but also the protection of intellectual property rights, the public procurement market, sustainable development and others. This paper aims to demonstrate key provisions and (both ex post and ex ante) opportunities that the agreement creates for EU companies. Research Design & Methods: The research methods include a critical review of existing literature, an analysis of relevant legal and official documents of the European Union, as well as the provisions of the EU-Japan trade agreement. The empirical research focused on Eurostat data. Findings: The provisions of the EU-Japan agreement provide an incentive for European companies to strengthen their position on the Japanese market. The elimination of import duties and other barriers to trade in Japan in relation to certain agricultural products on the entry into force of the agreement contributed to higher exports from the EU for these groups of goods. What might be expected is the additional effect of the liberalisation of bilateral trade on third countries. In fact, standards or rules agreed by Japan and the EU may become even more attractive to third countries, as their adoption would facilitate access to two large markets. Implications & Recommendations: Japan is a relatively important trading partner for the EU and vice versa. One of the biggest achievements of the agreement made between the European Union and Japan includes the wide and deep liberalisation of trade in goods. Despite the fact that the overall level of tariff protection is relatively low, there are still some groups of goods for which the protection in the form of customs duties constitutes an important barrier, as a result of which the conditions for competing on the partner’s market deteriorate. It seems that EU entrepreneurs should make more use of the opportunities which are created by the provisions of the free trade agreement with Japan. So far, the trade crisis caused by the pandemic has stood in the way. Contribution & Value Added: Research conducted so far is of an ex ante nature, both regarding the provisions of the agreement (publications written before 2018) and the evaluation of its potential effects on economy, trade, production or selected sectors. The research carried out in this article is of an ex post nature; it covers the period following the entry into force of the agreement and does not present any growth scenarios or forecasts, as was the case in the existing research. The article attempted to juxtapose the provisions of the agreement with Japan with trade conditions applicable to EU companies, as well as with the growth rate, volume and coverage of bilateral trade in goods.

A VISION OF THE POST-PANDEMIC ECONOMY

A VISION OF THE POST-PANDEMIC ECONOMY

Assessing the potential effects of the AfCFTA on togolese economy: An application of partial equilibrium model

Togo is one of the African countries to join spontaneously the African Continental Free Trade Area (AfCFTA), a new benchmark for trade development which seeks to provide a framework for the liberalization of trade in goods and services in Africa. Several economic opportunities are expected in Togo as a result of the implementation of the AfCFTA. This article provides insights on the potential implications of the AfCFTA Agreement for Togo in terms of trade, revenue and welfare effects. By applying the WITS‐SMART simulation model on 2018 disaggregated trade data, we find that, trade effects in Togo are likely to surge by US$ 8.83 million while promoting consumers' welfare by US$ 1.09 million. However, revenue losses are imminent as the country might experience a drop in tariff revenue of US$ 4.66 million. Overall, the AfCFTA is expected to improve on the country's trade balance as exports are envisaged to outweigh imports. In order to mitigate the revenue loses, we recommend that the country keeps substantial portion of tariff lines for sensitive and excluded products over a longer period during the liberalization.

The Effect and Mechanism of Trade Liberalization on Wage

This research discussed the relationship and mechanism between trade liberalization and the wage level of enterprises. Using the firm-level data from Annual Survey of Industrial Firms(ASIF) database and tariff data from World Bank, we find that, the final goods trade liberalization will reduce the wage, while the intermediate goods trade liberalization will improve the level of enterprises' wages. And that trade liberalization affects wages through firm performance. The reduction of input tariff reduces firm’s input cost, and increases firm’s sales and profit, then the firm has more ability to provide higher wages. While the decline of output tariff damages firm’s performance, which leads enterprises to transfer the loss by reducing wages.

Parallel imports and repair services

This study explores the welfare effects of parallel imports when the producer may refuse to provide repair services for parallel imported units, which reduces the degree of price convergence between countries. If the probability of the product’s breakdown is endogenously determined by the producer, permitting parallel imports could increase the probability, because a higher probability leads to a larger price gap. As a result, it is possible that prices increase and welfare deteriorates in both countries. This negative welfare effect is more likely to emerge as the liberalization of trade in goods proceeds. The prohibition of service discrimination recovers the positive welfare effect.

Free Trade Agreement between the EAEU/Russia and Japan: soes it Make Sense?

Despite rising protectionist trends, the number of free trade agreements (FTAs) continues to grow worldwide. The countries of the Eurasian economic Union (EAEU) also do not remain aloof from these processes. Feasibility studies of signing such agreements with various partner countries are underway in the Eurasian Economic Commission. This article discusses the likely effects of the FTA with Japan. A review of the structure and trends of mutual trade is done. The analysis reveals the statistical and logical relationship between the dynamics of trade in goods between Russia and Japan and oil prices, as well as the impact of such factors as the devaluation of the Russian ruble, the increase in duties on the import of used cars, WTO accession and sanctions. The article assesses the possible quantitative effects of liberalization of trade in goods between the EAEU countries (primarily Russia) and Japan. We use the partial equilibrium model SMART (from the WITS toolkit) and calculations for the budget loss of zeroing of import duties. The structural asymmetry of mutual trade and the likely effects of its liberalization on business and budgets of the participating countries is shown. The probable impact of the FTA on the automotive sector in the Russian Federation are considered separately.

Belt and Road Initiative (BRI): New Forms of International and Cross-Industry Collaboration for Sustainable Growth and Development

Building on the tradition, promises, and advances brought by the historical Silk Road, the Belt and Road Initiative (BRI), launched by the Chinese government in 2013, has a profound impact on international business and the established forms of international collaboration. Exploiting the advantages of liberalization of trade in goods, services, capital, and public procurement, BRI will benefit the Chinese economy. At the same time, it will prompt substantial changes in the field of international business, e.g., by means of fostering business to business (B2B) and peer to peer (P2P) collaboration. It will also influence patterns of Outward Foreign Direct Investment (OFDI). Geography plays a role in BRI; geopolitics is also in the cards. Given the profound implications BRI is likely to generate in the fields of businesses, economy, society, and politics, it is imperative to frame and streamline the discussion to identify the key mechanisms and causal relationships that it induces. This is precisely what this Special Issue sought to do.

Disintegration of the World Trade System: Reasons and Consequences

The article presents the study results of the world trade stagnation issues associated with the WTO systemic crisis. The aim of the article is to summarize the main reasons for the world trade system disintegration and to identify feasible directions for the world economic order transformation. The G20 trade-restricting measures were analyzed based on the statistical databases of the WTO and the non-governmental organization Global Trade Alert (GTA). The views of leading domestic and foreign experts on the consequences of liberalization of the world trade in goods and services were summarized. The author systematized the reasons for the world trade system disintegration, including: the US anti-globalization policy aimed at containing the PRC; counteracting unipolar globalization by the Southeast Asian nations; developed countries’ rejecting the growing participation of developing countries in redistributing global resources; inefficiency of international organizations in solving problems of global imbalances, inequality and instability of the global financial system. Structuring disintegration processes revealed its main trends: protectionism, regionalism, trans-regionalism. There were shown mechanisms to keep the US in the European Union due to companies providing professional services to European business. The author evaluated Russia and China’s competitive advantages in the production chains of the new technological structure. The areas of cooperation between Russia and the BRICS countries for realizing export potential in agriculture, aviation and nuclear industries were determined. The prospects for trade and economic relations in Eurasia are discussed in terms of changing the economic paradigm and shifting the regulation of the global economy problems to the regional level.

African Continental Free Trade Area Agreement: The Euphoria, Pitfalls and Prospects

The ratification of African Continental Free Trade Agreement (AfCFTA) climaxes African Union effort to foster intra-African Trade. AfCFTA is expected to foster socio-economic development and industrial competitiveness in Africa. AfCFTA will engender massive liberalization of intra-African trade in goods and services, making it easier for business to trade across borders and reduce the costs of trade. But there are fears that a successful implementation of the agreement in a continent that lacks capacity, industrial competitiveness and infrastructure will be fraught with challenges. The article examines the dynamics, and contends that the success of AfCFTA will be significantly dependent on a number of factors, namely the level of commitment exhibited by the Member States, availability of technical capacity and infrastructure, transparency and accountability of processes, and the manner infractions and complaints are addressed or redressed.

The International Trade Regime and the Quest for Free Digital Trade

AbstractThe global economy is experiencing the digitalization of production, exchange, and consumption of goods and services. The internet and cross-border data flows are becoming important channels of trade as more products are traded through the web or integrate features that rely on digital connectivity. Reflecting the autonomy states have to enact such policies, national variations in internet governance have expanded over the previous decade, with states increasingly looking to use internet and data policies for economic and trade objectives. These dynamics are having important implications on the international trade regime through challenging existing trade rules and creating demands for new rules. This has resulted in growing debates in the trade arena around “digital trade,” as a number of states, led by the United States, push for rules as a way to discipline national internet policies and support trade in digital goods and services. This paper examines the political economy of this campaign. We argue that the objectives of this campaign go beyond updating rules to better fit the “Internet age” into achieving further liberalization of trade in goods and services. We highlight the technological contingency of existing international rules and show how technological shifts have been a driver of competitive regime creation and forum shifting contributing to processes of fragmentation of the international trade regime.

New generation trade agreements as an economic challenge for the European Union and its Member States – the case of CETA

The so-called new-generation trade agreements, such as the CETA agreement signed by the EU and Canada, include not only the liberalization of trade in goods and the creation of a free trade area, but also many other areas, such as liberalization of the services market, including public services, mutual recognition of professional qualifications, deregulation and liberalization of financial markets, enhanced cooperation in the protection of intellectual property, and mutual investment protection. The considerations carried out in this work show that the analysis of the consequences of this type of agreements should be carried out not only at the level of the entire EU but also from the perspective of individual member states whose level of economic development and economic structures differ significantly. This is important for proper preparation for the entry into force of such an agreement, creating conditions for the full use of the opportunities arising from it and for adapting to the new market-specific situation and avoiding the greatest possible threats.

Internal Trade in Canada

This paper assesses the costs of internal trade barriers and proposes policies to improve internal trade. Estimates suggest that complete liberalization of internal trade in goods can increase GDP per capita by about 4 percent and reallocate employment towards provinces that experience large productivity gains from trade. The positive impact highlights the need for federal, provincial and territorial governments to work together to reduce internal trade barriers. There is significant scope to build on the new Canadian Free Trade Agreement to more explicitly identify key trade restrictions, resolve differences, and agree on cooperative solutions.

The African Continental Free Trade Agreement

In March 2018, representatives of member countries of the African Union signed the African Continental Free Trade Area (AfCFTA) agreement. This agreement provides a framework for trade liberalization in goods and services and is expected to eventually cover all African countries. Using a multi-country, multi-sector general equilibrium model based on Costinot and Rodriguez-Clare (2014), we estimate the welfare effects of the AfCFTA for 45 countries in Africa. Three different model specifications—comprising both perfect competition and monopolistic competition—are used. Simulations include full elimination of import tariffs and partial but substantial reduction in non-tariff barriers (NTBs). Results reveal significant potential welfare gains from trade liberalization in Africa. As intra-regional import tariffs in the continent are already low, the bulk of these gains come from lowering NTBs. Overall gains for the continent are broadly similar under the three model specifications used, with considerable variation of potential welfare gains across countries in all model structures.

The African Continental Free Trade Agreement: Welfare Gains Estimates from a General Equilibrium Model

In March 2018, representatives of member countries of the African Union signed the African Continental Free Trade Area (AfCFTA) agreement. This agreement provides a framework for trade liberalization in goods and services and is expected to eventually cover all African countries. Using a multi-country, multi-sector general equilibrium model based on Costinot and Rodriguez-Clare (2014), we estimate the welfare effects of the AfCFTA for 45 countries in Africa. Three different model specifications-comprising both perfect competition and monopolistic competition-are used. Simulations include full elimination of import tariffs and partial but substantial reduction in non-tariff barriers (NTBs). Results reveal significant potential welfare gains from trade liberalization in Africa. As intra-regional import tariffs in the continent are already low, the bulk of these gains come from lowering NTBs. Overall gains for the continent are broadly similar under the three model specifications used, with considerable variation of potential welfare gains across countries in all model structures.

Internal Trade in Canada: Case for Liberalization

This paper assesses the costs of internal trade barriers and proposes policies to improve internal trade. Estimates suggest that complete liberalization of internal trade in goods can increase GDP per capita by about 4 percent and reallocate employment towards provinces that experience large productivity gains from trade. The positive impact highlights the need for federal, provincial and territorial governments to work together to reduce internal trade barriers. There is significant scope to build on the new Canadian Free Trade Agreement to more explicitly identify key trade restrictions, resolve differences, and agree on cooperative solutions.

Оценка рисков либерализации торговли товарами со странами Азии в рамках российской политики «Поворота на Восток»

Trade liberalization with Asian countries is a key issue on the agenda of Russia and the Eurasian Economic Union’s (EAEU) economic and trade connectivity with the Asia-Pacific region (APR). However, the signing of free trade agreements (FTAs) has traditionally been negatively perceived in both Russia and EAEU partner countries because of the extremely conservative prevailing trade policy. This study simulated the situation of full liberalization of Russian trade in goods with Rep. of Korea (here and after: Korea), Singapore, India, Japan and China to assess the risks of such agreements. The countries were selected on the basis of the current negotiating tracks of the EAEU and the analysis of Russian foreign trade with the APR countries. The simulation was performed using a partial equilibrium model built with the SMART software provided by the World Integrated Trade Solution.The article highlights key product groups, increases in imports of which can be expected with a complete abolition of import duties by Russia (taking into account sensitive tariff lines). In addition, the authors conclude that in this case, imports of Indian and Korean products will increase by approximately 7.5%, and imports from Japan and Singapore, respectively, by 7% and 6.5% of the cost of imports from these countries in 2016. The simulation showed an 8% increase in imports from China, which in absolute terms exceeds the current level of trade with India and Singapore combined. This confirms the low probability of starting the FTA negotiations with China in short and medium term.The article was supported by Russian Science Foundation Grant No 17-18-01577 “Developing the Community of Greater Eurasia and Strategy of Russia’s Bilateral Partnership with Countries of the Region”.

Paris Needs Geneva, and Vice Versa

AbstractThis paper proposes and seeks to explain how the launching of a new negotiation on trade in carbon‐reduction‐related goods and services in Geneva could help to restore the effective market penetration of the Paris Agreement mechanisms, and how the subsequent implementation of the Paris Agreement can revitalize the so‐called ‘paralyzed WTO‘ at Geneva. It suggests that new negotiations be dedicated to the liberalization of trade in goods that relate closely to greenhouse‐gas reduction. Drawing on experiences from the stalled Environmental Goods Agreement (EGA) negotiations, this narrowing of the scope of the talks might help establish a clear theme, thus avoiding potential conflicts of interest among the negotiating parties. Moreover, if the market penetration of green technologies is to be advanced effectively, negotiations must cover trade in related services (e.g. systems engineering) as well. Inclusion of services can also mitigate the ‘critical mass’ concerns inherent in the goods‐only context. Improving market access to government procurements and facilitating technology transfer in carbon‐reduction sectors will help to spread green technologies globally, and could be the topic of the new framework. In the end, the paper envisages a scenario of high participation and offers a possible approach to the initiation of new talks.