Preferential trading

area

A preferential trade area (also preferential

trade agreement, PTA) is a trading bloc
that gives preferential access to certain
products from the participating countries.
This is done by reducing tariffs but not by
abolishing them completely. A PTA can be
established through a trade pact. It is the
first stage of economic integration. The
line between a PTA and a free trade area
(FTA) may be blurred, as almost any PTA
has a main goal of becoming a FTA in
accordance with the General Agreement
on Tariffs and Trade.

These tariff preferences have created

numerous departures from the normal
trade relations principle, namely that World
Trade Organization (WTO) members
should apply the same tariff to imports
from other WTO members.[1]

With the recent multiplication of bilateral

PTAs and the emergence of Mega-PTAs
(wide regional trade agreements such as
the Transatlantic Trade and Investment
Partnership (TTIP) or Trans Pacific
Partnership (TPP)), a global trade system
exclusively managed within the framework
of the WTO now seems unrealistic and the
interactions between trade systems have
to be taken into account. The increased
complexity of the international trade
system generated by the multiplication of
PTAs should be taken into account in the
study of the choice of fora used by
countries or regions to promote their trade
relations and environmental agenda.[2]

List of preferential trade

areas
Stages of economic integration around the World
(each country colored according to the most
integrated form that it participates with):
   Economic and monetary union (CSME/EC$, EU/€,
Switzerland–Liechtenstein/CHF)
   Economic union (CSME, EU–UK, EAEU,
MERCOSUR, GCC, SICA)
   Customs and monetary union (CEMAC/XAF,
UEMOA/XOF)
   Common market (EEA–Switzerland, ASEAN)
   Customs union (CAN, EAC, EUCU, SACU)
   Multilateral Free Trade Area (CEFTA, CISFTA,
COMESA, CPTPP, DCFTA, EFTA, GAFTA, USMCA,
SAFTA, AANZFTA, PAFTA, SADCFTA)
vte
A free trade area is basically a preferential
trade area with increased depth and scope
of tariffs reduction. All free trade areas,
customs unions, common markets,
economic unions, customs and monetary
unions and economic and monetary
unions are considered advanced forms of
a PTA, but these are not listed below.

Multilateral …

Economic Cooperation Organization

(ECO) (1992)
Generalized System of Preferences
Global System of Trade Preferences
among Developing Countries (GSTP)
 (1989)
Latin American Integration Association
(LAIA/ALADI) (1981)[3]
Melanesian Spearhead Group (MSG)
(1994)
Protocol on Trade Negotiations (PTN)
(1973)
South Pacific Regional Trade and
Economic Cooperation Agreement
(SPARTECA) (1981)[4]

Bilateral …

Several hundred bilateral PTAs have been

signed since the early 20th century. The
TREND project[5] of the Canada Research
Chair in International Political Economy
lists around 700 trade agreements, the
vast majority of which are bilateral.[6]

European Union – ACP countries,

formerly via the trade aspects of the
Cotonou Agreement, later via Everything
But Arms (EBA) agreements
India – Afghanistan (2003)
India – Mauritius
India – Nepal (2009)
India – Chile (2007)
India – MERCOSUR (2009)
ASEAN – PR China (2005)
Laos – Thailand (1991)
See also
Bilateral investment treaty (BIT)
Trade and Investment Framework
Agreement (TIFA).

References
1. CRS Report for Congress: Agriculture:
A Glossary of Terms, Programs, and
Laws, 2005 Edition - Order Code 97-
905 Archived 10 August 2011 at the
Wayback Machine
2. Jean-Frédéric Morin, Tereza Novotná,
Frederik Ponjaert and Mario Telò, The
Politics of Transatlantic Trade
 Negotiations, TTIP in a Globalized
World, Routledge, 2015, p. 127.
3. From 18 March 1981 LI5342
4. From 1 January 1981
WT/COMTD/N/29 Archived 27
March 2009 at the Wayback Machine
5. "Ongoing projects - Chaire de
recherche du Canada en économie
politique internationale (EPI)" .
www.chaire-epi.ulaval.ca.
6. "Acces; TRade & ENvironment
Database" . Access TRade &
ENvironment Database.

External links
 WTO PTA list
World Bank PTA database

Retrieved from
"https://en.wikipedia.org/w/index.php?
title=Preferential_trading_area&oldid=950535750"

Last edited 4 months ago by Rich Farmbrough

Content is available under CC BY-SA 3.0 unless

otherwise noted.