IDEAS home Printed from
   My bibliography  Save this paper

Trade preferential agreements in Latin America : an ex-ante assessment


  • Michaely, Michael


In the past decade a sea change has taken place in trade policies in Latin America: within a few years, most of the region's economies have changed from restrictive to open policies. But unlike trade liberalization in Europe, most trade barriers in Latin America have been reduced unilaterally. Recently bilateral or multilateral agreements have been considered, especially preferential tradeagreements within the region. The author evaluates the relevance and desirability of multilateral free trade agreements (such as NAFTA) for the Latin American continent and the Caribbean, with an emphasis on how they affect trade flows. Is a preferential trade agreement among some Latin American countries more or less likely to be meaningful than others - important in intensity of impact, or beneficial, or both? The evidence strongly suggests little likelihood that these agreements will succeed in Latin America. Paradoxically, the intense liberalization in recent years has made it less likely that such agreements would be beneficial - except possibly for agreements between some countries and Brazil, Mexico, or (to a lesser extent) Argentina. When the level of tariffs and nontariff barriers is already low, a preferential agreement is more likely to have an adverse impact than a beneficial one (although in any case only a slight impact). Between countries, the patterns of exports and imports are similar, suggesting a potential for trade diversion. Most countries would benefit from a preferential agreement with the United States, however. And U.S. agreements with blocks of Latin American countries are no more beneficial to those countries than are U.S. agreements with individual countries.

Suggested Citation

  • Michaely, Michael, 1996. "Trade preferential agreements in Latin America : an ex-ante assessment," Policy Research Working Paper Series 1583, The World Bank.
  • Handle: RePEc:wbk:wbrwps:1583

    Download full text from publisher

    File URL:
    Download Restriction: no


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Lord, Montague, 2015. "Regional Economic Integration in Central Asia and South Asia," MPRA Paper 66436, University Library of Munich, Germany.
    2. Hans Weisfeld & Manuela Goretti, 2008. "Trade in the WAEMU; Developments and Reform Opportunities," IMF Working Papers 08/68, International Monetary Fund.
    3. Vaqar Ahmed & Samavia Batool, 2017. "India-Pakistan Trade: Perspectives from the Automobile Sector in Pakistan," Working Papers id:12263, eSocialSciences.
    4. Khadan, Jeetendra & Hosein, Roger, 2014. "Trade, Economic and Welfare impacts of the CARICOM-Canada Free Trade Agreement," MPRA Paper 54836, University Library of Munich, Germany.
    5. Terra, María Inés, 1998. "Uruguay en el MERCOSUR: perspectivas del comercio intrarregional," Oficina de la CEPAL en Montevideo (Estudios e Investigaciones) 28649, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    6. Cadot, Olivier & de Melo, Jaime & Olarreaga, Marcelo, 1999. "Asymmetric Regionalism in Sub-Saharan Africa: Where Do We Stand?," CEPR Discussion Papers 2299, C.E.P.R. Discussion Papers.
    7. repec:wfo:wstudy:58723 is not listed on IDEAS
    8. World Bank, 2006. "Is There a New Vision for Maghreb Economic Integation? Volume 2. Annex," World Bank Other Operational Studies 19624, The World Bank.
    9. Khadan, Jeetendra & Hosein, Roger, 2014. "Trade, Economic and Welfare impacts of the CARICOM-Canada Free Trade Agreement," MPRA Paper 54836, University Library of Munich, Germany.
    10. repec:zbw:espost:163428 is not listed on IDEAS


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wbk:wbrwps:1583. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Roula I. Yazigi). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.