The World Trade Organization (WTO) has released its World Trade Report for 2011, which focuses on preferential trade agreements and the co-existence of these agreements with the global trading system.
Preferential trade agreements (PTAs) are bilateral or regional trade agreements that provide preferential treatment to specific trading partners, such as reduced tariffs or quotas. The WTO has generally allowed PTAs to co-exist with the multilateral trading system, but the report argues that there is a need for greater coherence between these agreements and the global trading system.
According to the report, there are currently over 300 PTAs in force, with an additional 150 being negotiated. These agreements cover over 50 percent of global trade, with some countries having multiple PTAs with different partners.
The report highlights several challenges posed by the proliferation of PTAs, including the potential for fragmentation of the global trading system, the increased complexity of trade rules, and the potential for discrimination against non-PTA members.
The report suggests that greater coherence between PTAs and the global trading system can be achieved through several measures. These include improving transparency and notification of PTAs, ensuring that PTAs comply with WTO rules, and promoting convergence between PTAs and the multilateral trading system.
The report also notes that the WTO can play a vital role in facilitating greater coherence between PTAs and the global trading system. This includes providing technical assistance and capacity building to countries that are negotiating PTAs, as well as developing rules and guidelines that promote coherence.
Overall, the World Trade Report for 2011 highlights the need for greater coherence between preferential trade agreements and the global trading system. While PTAs can provide important benefits to participating countries, it is essential that these agreements are consistent with WTO rules and do not undermine the multilateral trading system. By promoting greater coherence, the WTO can help ensure that PTAs contribute to, rather than detract from, the goal of a more open and integrated global trading system.