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RTAs and WTO compatibility: Catch me if you can? The case of EPA negotiations


  • Cernat, Lucian
  • Onguglo, Bonapas
  • Ito, Taisuke


There is an ongoing debate about best ways to assess the compatibility of RTAs with WTO rules and the possible negative impact that the proliferation of RTA formation may have on individual members and on the stability of the multilateral trading system as a whole. Therefore, rules defining the WTO compatibility of RTAs are one of the issues under in the WTO Doha negotiations. Taking the current EPA negotiations between ACP and EU as an example, this paper examines two sorts of questions: (i) the implications for developing country members of the current proposals to tighten the rules on WTO compatibility of RTAs; (ii) the impact that the proliferation of RTA formation may have on non-RTA members and on the stability of the multilateral trading system as a whole. More specifically, the paper assesses quantitatively using a partial equilibrium framework the implications for ACP countries of some of the proposals to reform GATT Art. XXIV, in particular the “substantially all trade” criteria. Based on a CGE approach, the paper then looks at the implications of EPA negotiations on third countries and its linkages with the ongoing Doha negotiations, in particular on how the future EPA agreements could be non-trade diverting, in line with Ohyama-Panagariya-Krishna version of the Kemp-Wan theorem.

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  • Cernat, Lucian & Onguglo, Bonapas & Ito, Taisuke, 2007. "RTAs and WTO compatibility: Catch me if you can? The case of EPA negotiations," MPRA Paper 3645, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:3645

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    References listed on IDEAS

    1. Eric W. Bond & Raymond G. Riezman & Constantinos Syropoulos, 2013. "A strategic and welfare theoretic analysis of free trade areas," World Scientific Book Chapters,in: International Trade Agreements and Political Economy, chapter 8, pages 101-127 World Scientific Publishing Co. Pte. Ltd..
    2. Hertel, Thomas, 1997. "Global Trade Analysis: Modeling and applications," GTAP Books, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, number 7685.
    3. Pomfret, Richard, 2002. "State-Directed Diffusion Of Technology: The Mechanization Of Cotton Harvesting In Soviet Central Asia," The Journal of Economic History, Cambridge University Press, vol. 62(01), pages 170-188, March.
    4. Hakim Ben Hammouda & Patrick N. Osakwe, 2008. "Global Trade Models and Economic Policy Analyses: Relevance, Risks and Repercussions for Africa," Development Policy Review, Overseas Development Institute, vol. 26(2), pages 151-170, March.
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    Cited by:

    1. Lucian Cernat & Nuno Sousa, 2014. "TTIP: A Transatlantic Bridge for Worldwide Gains," CESifo Forum, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 15(2), pages 32-36, April.

    More about this item


    ACP; EPA; Kemp-Wan; partial equilibrium analysis; CGE; GATT Art XXIV;

    JEL classification:

    • F17 - International Economics - - Trade - - - Trade Forecasting and Simulation
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration
    • F1 - International Economics - - Trade

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