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Preferential Market Access Design: Evidence and Lessons from African Apparel Exports to the US and to the EU

Author

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  • Jaime DE MELO

    () (Ferdi)

  • Alberto PORTUGAL-PEREZ

    (FERDI)

Abstract

Least developing countries (LDC) rely on preferential market access which is mechanically eroded by the tariff reductions by grantor countries to other countries. Effective market access depends on the severity of the Rules of Origin that have to be met to qualify for these preferences. These Rules of Origin have turned out to be complicated and burdensome for LDC exporters. Since 2001, under the US Africa Growth Opportunity Act (AGOA), 22 African countries exporting apparel to the US can use fabric from any origin and still meet the criterion for preferential access (single transformation), while the European Union continued to require yarn to be woven into fabric and then made-up into apparel in the same country (double transformation).

Suggested Citation

  • Jaime DE MELO & Alberto PORTUGAL-PEREZ, 2012. "Preferential Market Access Design: Evidence and Lessons from African Apparel Exports to the US and to the EU," Working Papers P47, FERDI.
  • Handle: RePEc:fdi:wpaper:424
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    File URL: http://www.ferdi.fr/sites/www.ferdi.fr/files/publication/fichiers/P47_DeMelo_PortugalPerez_Web.pdf
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    References listed on IDEAS

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    1. Miriam Manchin, 2004. "Preference Utilisation and Tariff Reduction in EU Imports from ACP Countries," Tinbergen Institute Discussion Papers 04-132/2, Tinbergen Institute.
    2. Joseph Francois & Bernard Hoekman & Miriam Manchin, 2006. "Preference Erosion and Multilateral Trade Liberalization," World Bank Economic Review, World Bank Group, pages 197-216.
    3. Krueger, Anne O., 1997. "Free trade agreements versus customs unions," Journal of Development Economics, Elsevier, pages 169-187.
    4. J. M. C. Santos Silva & Silvana Tenreyro, 2006. "The Log of Gravity," The Review of Economics and Statistics, MIT Press, pages 641-658.
    5. Cherkashin, Ivan & Demidova, Svetlana & Kee, Hiau Looi & Krishna, Kala, 2015. "Firm heterogeneity and costly trade: A new estimation strategy and policy experiments," Journal of International Economics, Elsevier, pages 18-36.
    6. Honore, Bo E, 1992. "Trimmed LAD and Least Squares Estimation of Truncated and Censored Regression Models with Fixed Effects," Econometrica, Econometric Society, vol. 60(3), pages 533-565, May.
    7. Svetlana Demidova & Kala Krishna & Hiau Looi Kee & Ivan Cherkashin, 2009. "Firm Heterogeneity and Costly Trade: A New Estimation Strategy and Policy Experiments," 2009 Meeting Papers 1199, Society for Economic Dynamics.
    8. Cherkashin, Ivan & Demidova, Svetlana & Kee, Hiau Looi & Krishna, Kala, 2015. "Firm heterogeneity and costly trade: A new estimation strategy and policy experiments," Journal of International Economics, Elsevier, pages 18-36.
    9. de Melo, Jaime & Portugal-Pérez, Alberto, 2008. "Rules of Origin, Preferences and Diversification in Apparel: African Exports to the US and to the EU," CEPR Discussion Papers 7072, C.E.P.R. Discussion Papers.
    10. Miriam Manchin, 2006. "Preference Utilisation and Tariff Reduction in EU Imports from ACP Countries," The World Economy, Wiley Blackwell, vol. 29(9), pages 1243-1266, September.
    11. Olivier Cadot & Céline Carrère & Jaime de Melo & Alberto Portugal-Pérez, 2005. "Market Access and Welfare under Free Trade Agreements: Textiles under," World Bank Economic Review, World Bank Group, vol. 19(3), pages 379-405.
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    Cited by:

    1. Sylviane Guillaumont Jeanneney & Ping Hua, 2015. "The impact of Chinese competition on Africa’s manufacturing," Working Papers halshs-01179283, HAL.

    More about this item

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration

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