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Trade Impacts of Selected Regional Trade Agreements in Agriculture

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  • Jane Korinek
  • Mark Melatos

Abstract

This paper provides an in-depth examination of the trade effects of three regional trade agreements (RTAs) – the ASEAN Free Trade Agreement (AFTA), the Common Market for Eastern and Southern Africa (COMESA) and the Southern Cone Common Market (MERCOSUR) -- in the agricultural sector. Results from a gravity model suggest that the creation of AFTA, COMESA and MERCOSUR have increased trade in agricultural products between their member countries. There is no robust indication of trade diversion with respect to imports from outside the region. The agreements are therefore net trade creating. There is no robust indication however that there has been strong trade creation with non-members in the case of any of the RTAs under study. In some cases, lack of transport and communications infrastructure, in addition to supply constraints, lessens the effect of the RTA on trade flows. Trade costs such as transport and logistics seem to remain important factors in determining agricultural trade flows. In some RTAs, countries have a comparative advantage in exporting many of the same agricultural products, thereby decreasing the impact of the preferential market access. A number of implications for South-South RTAs can be drawn from examining these very different agreements.

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File URL: http://dx.doi.org/10.1787/225010121752
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Bibliographic Info

Paper provided by OECD Publishing in its series OECD Trade Policy Papers with number 87.

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Date of creation: 03 Apr 2009
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Handle: RePEc:oec:traaab:87-en

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Related research

Keywords: trade liberalisation; RTA; agricultural trade; gravity model; COMESA; ASEAN; trade creation; access; South-South; trade diversion; preferential market access; tariffs; regional trade agreements; AFTA; Mercosur;

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References

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Citations

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Cited by:
  1. Brooks, Douglas & Ferrarini, Benno & Go, Eugenia, 2013. "Bilateral Trade and Food Security," ADB Economics Working Paper Series 367, Asian Development Bank.
  2. van Dijk, Michiel, 2011. "African Regional Integration: Implications for Food Security," Paper Series 101645, Agricultural Economics Research Institute.
  3. Nawrocka, Agnieszka Baer & Sapa, Agnieszka, 2013. "Agricultural Labour Productivity and the Intensity of Agri-food Trade in Selected Regional Trade Agreements," Proceedings Issues, 2013: Productivity and Its Impacts on Global Trade, June 2-4, 2013. Seville, Spain 152381, International Agricultural Trade Research Consortium.
  4. Douillet, Mathilde, 2012. "Trade policies and agricultural exports of Sub-Saharan African countries: Some stylized facts and perspectives," MPRA Paper 40962, University Library of Munich, Germany.
  5. Nabil Chaherli & John Nash, 2013. "Agricultural Exports from Latin America and the Caribbean : Harnessing Trade to Feed the World and Promote Development," World Bank Other Operational Studies 16048, The World Bank.
  6. Pascal Ghazalian, 2013. "MERCOSUR enlargement: predicting the effects on trade in primary agricultural commodities," Economic Change and Restructuring, Springer, vol. 46(3), pages 277-297, August.

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