A new publication on regional trade agreements (RTAs) and how they can potentially affect rules of the WTO and its members was launched at the WTO on 29 September, Day 3 of the Public Forum. The collection of studies uses what is perhaps the largest dataset yet on RTAs.

“Regional Trade Agreements and the Multilateral Trading System”, edited by Rohini Acharya, Chief of the RTA Section, and authored by staff of the WTO Secretariat, examines provisions contained within these reciprocal trade deals to see to what extent they reflect or diverge from the WTO’s legal texts. The book thus provides a greater understanding of whether RTAs are creating new standards different from the WTO’s and the possible implications these pose. Amid the growing number and complexity of RTAs today, the publication contributes to the current debate on the role of the WTO in regulating international trade.

The contributors to the book look at RTA provisions liberalizing trade in goods and services as well as other provisions covering a range of issues, such as trade defence, trade facilitation, standards, intellectual property and dispute settlement. The chapters are based on all RTAs notified to the WTO up until 2014. Thus, in contrast to other publications, the studies in this book set out to capture all the different approaches and standards developed by RTAs rather than just those taken by the world's largest traders. A final chapter presents views on the implications of these studies' findings for the multilateral trading system and suggests next steps to further enhance understanding on this issue.

In launching the publication, Director-General Roberto Azevêdo highlighted the importance of the book’s findings to the ongoing conversation about RTAs and ways these agreements could be further improved. He noted how the WTO will continue efforts to improve the trading environment on the multilateral track while also seeking to improve coherence with other initiatives.

He said: “More can be done to promote coherence. We have been building a record of success here in Geneva. After a long period when RTAs were at the forefront of the trade debate, I think we are starting to see a shift.

“We will continue our efforts at the multilateral level. And while we seek to improve coherence between different initiatives, I have absolutely no doubt that RTAs will continue to coexist with the multilateral trading system and will in fact reinforce the multilateral system in the future as they have always done in the past.”

Also speaking at the launch, Rohini Acharya said that the book brings together work done by staff members of the WTO Secretariat and adds to the existing literature on RTAs. It had also benefited from a seminar held for WTO members in September 2014 and she hoped it would be useful in the current debate in the WTO on the systemic implications of RTAs for the multilateral trading system.

Bernard Hoekman, Professor and Director for Global Economics at the Robert Schuman Centre for Advanced Studies, European University Institute, was also on the speaking panel at the book launch along with Ambassador Daniel Blockert (Sweden), who chairs the WTO Committee on RTAs.

“This book looks at all agreements out there and sheds a lot of light on issues that are debated often without evidence. It opens the black box of preferential trade agreements,” Mr Hoekman said. “This is a wonderful piece of work and I look forward to the next one which will hopefully help us understand how these things are implemented.”

Mr Blockert said: “We are having this discussion on RTAs everywhere else but not at the WTO. And I do hope that will change. I think there are signs that interest and engagement is increasing.”

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Book Launch: “Regional Trade Agreements and the Multilateral Trading System”

Opening remarks by DG Azevêdo

Good afternoon everyone, and welcome.

I am pleased to be with you today, and to be launching this new WTO publication on RTAs and the multilateral trading system.

These agreements existed before the GATT and they continue to grow in number today. So this is a very old relationship, but it continues to evolve.

There are 267 RTAs notified to the WTO and currently in force.

And with the notification of an RTA between Japan and Mongolia earlier this year, all WTO members are now party to at least one RTA.

The publication we are launching today is a further step in improving our understanding of what RTAs are doing and also what we could do at the WTO.

The chapters were first presented at a seminar at the WTO in September 2014 and they have been developed since then, drawing on comments from members.

But the genesis of this publication was a decision taken by the WTO General Council in December 2006, almost 10 years ago, to establish a Transparency Mechanism for RTAs. This Mechanism has allowed the Secretariat to build up an impressive database of information on RTAs – not just how many RTAs are in force today but also the detail of their key provisions.

The information gathered has allowed us to carry out a more detailed analysis of many of these provisions and that is presented to you in this book today.

It covers a broad range of provisions, including: market access and rules of origin in goods, trade defence, trade facilitation, standards, services rules, intellectual property rights and dispute settlement.

A very important feature is that the book doesn’t just examine these provisions in selected RTAs, as others have done. It examines the provisions in all RTAs notified to the WTO. That's quite a formidable task, and I pay tribute to everyone involved.

It shows that in some areas RTAs are going further than multilateral rules and adding new layers of rules among the parties, while in others they tend not to change the existing WTO disciplines.

Interestingly, in the areas where RTAs are introducing new rules, there appear to be common approaches taken by members. We can see this, for example, in services rules, dispute settlement, and intellectual property rights.

This provides some reassurance to the recurring fear that RTAs represent a fragmentation of the global trading system.

This may be good news for exporters, in particular SMEs, which find themselves at a disadvantage when faced with a proliferation of different rules. But, of course, RTAs could do more to assist such exporters.

For instance, rules of origin, which often determine whether an exporter is able to use preferences in an RTA, have become more complex over the years.

One way in which this complexity could be reduced would be to allow cumulation among a larger group of countries. For example, the Pan-Euro-Mediterranean rules of origin allow cumulation among over 20 trading partners – counting the EU as one partner. In this way it allows traders to benefit from regional value chains.

Of course more can be done to promote coherence.

We have been building a record of success here in Geneva. After a long period when RTAs were at the forefront of the trade debate, I think we are starting to see a shift.

I attended my fourth G20 meeting as Director-General earlier this month, and the WTO was at the heart of the conversation in a way that I haven't seen before.

Achievements like the Trade Facilitation Agreement, the decision to eliminate agricultural export subsidies, and others, have clearly been noticed.

Both of these issues are also dealt with by RTAs, but it is clear that a multilateral agreement between 164 WTO members has a much bigger impact.

So we will continue our efforts at the multilateral level. And while we seek to improve coherence between different initiatives, I have no doubt that RTAs will continue to coexist with and reinforce the multilateral system in the future as they have always done in the past. 

In closing, I would like to pay tribute once again to all those who have been involved in the publication, especially the contributors who undertook the task of examining every single RTA notified to the WTO. Congratulations on a fantastic publication – as well as on your endurance!

Particular thanks go to Rohini who has been the driving force behind this project.

The book adds important elements to the literature on RTAs and I am sure you will find it to be an interesting and enlightening read.