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Rules of Origin in the Africa-EU Strategic Partnership Agreement and Nigeria’s international trade

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  • Balogun, Emmanuel Dele

Abstract

This paper examines the key issues and assesses the impact of the rules of origin (RoO) and cumulation on Nigeria’s international trade within the context of Africa-EU partnerships agreements. The review of literatures shows that RoO are an important element in determining the final benefit associated with the bilateral trade relationship under preferential trade agreements. It notes that Africa-EU bilateral trade relations dates back to the Lome Conventions that gave preferential entry into EU of some products, and now to the new Africa-EU partnership which lays less emphasis on RoO. An analysis of available data show that RoO have had limited impact on Nigeria’s exports trade with the EU since her major exports (crude oil) does not benefit from RoO. Instead, there has been an increase in intermediate imports from EU which suggests trade creation in favour of EU while the rising trend in trade within Africa could be the result of bilateral cumulation and intra-Africa FTAs/economic integration. The paper further argues that the increase in trade with USA and others may be the result of trade reorientation as a result of switching from EU to other cheaper partner countries, especially USA in the face of AGOA. Among the challenges which militate against the RoO are: global reduction in tariff by WTO and the changing focus of the objectives of Africa-EU partnership principles from PTA to regional support. In concluding, the paper notes that the new partnership agreements needs to reconsider its position on RoO as it is a potent tool that is mutually beneficial in partnership. As such, the EU must go beyond the WTO GSP and AGOA to give preferential treatment to goods originating from Africa.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 23921.

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Date of creation: 14 Jul 2010
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Handle: RePEc:pra:mprapa:23921

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Keywords: Rules of origin; international trade; Africa-EU partnership; Lome Conventions; preferential trade agreements.;

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  1. Rod Falvey & Geoff Reed, 1998. "Economic effects of rules of origin," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 134(2), pages 209-229, June.
  2. Anne O. Krueger, 1993. "Free Trade Agreements as Protectionist Devices: Rules of Origin," NBER Working Papers 4352, National Bureau of Economic Research, Inc.
  3. AUGIER Patricia & GAZIOREK Michael & LAITONG Charles, 2004. "The Impact of Rules of Origin On Trade Flows," International Trade 0404001, EconWPA.
  4. Baldwin, Richard & Jaimovich, Dany, 2012. "Are Free Trade Agreements contagious?," Journal of International Economics, Elsevier, vol. 88(1), pages 1-16.
  5. Rod Falvey & Geoff Reed, 2002. "Rules of Origin as Commercial Policy Instruments," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 43(2), pages 393-408, May.
  6. Kala Krishna & Anne Krueger, 1995. "Implementing Free Trade Areas: Rules of Origin and Hidden Protection," NBER Working Papers 4983, National Bureau of Economic Research, Inc.
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