Free Trade Agreements and Globalisation

287 Pages·2018·3.5 MB·English

by  Arne Melchior

FREE TRADE
AGREEMENTS AND
GLOBALISATION
In the Shadow of Brexit and Trump
Arne Melchior
Free Trade Agreements and Globalisation
Arne Melchior
Free Trade
Agreements and
Globalisation
In the Shadow of Brexit and Trump
Arne Melchior
Norwegian Institute of International Affairs
Oslo, Norway
ISBN 978-3-319-92833-3 ISBN 978-3-319-92834-0 (eBook)
https://doi.org/10.1007/978-3-319-92834-0
Library of Congress Control Number: 2018946237
© The Editor(s) (if applicable) and The Author(s) 2018
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Acknowledgements
Main parts of this book were written as contributions to the research
project “Europe in transition—small states in an age of global shifts
(EUNOR)”, funded by the Research Council of Norway (project no.
238017) during 2014–2017. The model presented in Chap. 6 and
Appendix B was partly developed as part of the research project “Trade
Integration, Geopolitics and the Economy of Russia (TIGER)”, funded
by the Research Council of Norway during 2013–2016 (project no.
228244). I would like to gratefully acknowledge the financial support
provided by the Research Council of Norway. I thank Natalia Turdyeva
and other TIGER projects’ participants for useful feedback when the pre-
liminary material was presented at a project workshop at Centre for
Economic and Financial Research (CEFIR), Moscow (21 April 2016). I
also thank Natalia Turdyeva and Roman Vakulchuk for guidance in
accessing regional data for Russia and Kazakhstan, respectively, and Sergei
Golovan for useful advice on aspects of MATLAB programming. Parts of
the material included in the book were also presented at seminars during
2017 at the University of Oslo and at the Norwegian Institute of
International Affairs, Oslo, Norway, and at the conference on “Trade and
Integration in a Time of Anti-Globalisation” in Malmö, Sweden, on
25–27 October 2017. I thank the participants at these seminars and con-
ferences for their valuable comments. Finally, I thank the anonymous
referees of Palgrave Macmillan for their useful comments on the plan for
v
vi Acknowledgements
the book as well as a preliminary version of it. I also thank Laura Pacey
and Clara Heathcock at Palgrave Macmillan for their excellent follow-up
as well as patience when the book deadline had to be postponed for
unforeseen reasons. As usual, the responsibility for remaining errors, if
any, stays with the author.
Contents
1 Introduction and Overview 1
2 A Portrait of World Trade 19
3 The Global Landscape of FTAs 37
4 Tariffs: The Most and the Least Favoured Nations 49
5 Non-tariff Issues in FTAs 67
6 How Important Is Trade? Estimates from a World Trade
Model 93
7 Trade, USA and the Rise of China: Pains and Gains 115
8 Global Versus Local Integration and Europe’s Options 131
9 Trade Policy Spillovers and Regulatory Cooperation 147
vii
viii Contents
A ppendix A: Data Tables 173
Appendix B: A World Trade Model with Commodities
and Differentiated Goods 179
Appendix C: Tables Related to Numerical Model Simulations 211
Appendix D: Teaching Material: A Simple Model of Regional
Trade Integration 265
Index 271
Abbreviations
ACP Africa, Caribbean and Pacific countries
AD Anti-dumping
AfCFTA African Continental Free Trade Area
AGOA African Growth and Opportunity Act (US trade preferences)
ANZCERTA A ustralia-New Zealand Closer Economic Relations Trade
Agreement
BEA Bureau of Economic Analysis (US agency)
BITs Bilateral Investment Treaties
CBI Caribbean Basin Initiative (US trade preferences)
CD Countervailing Duties (WTO measure against subsidies)
CES Constant Elasticity of Substitution
CGE Computable General Equilibrium
COMTRADE United Nations Commodity Trade Statistics Database
CTS Consolidated Tariff Schedules (of the WTO)
DESTA Design of Trade Agreements database
DSM Dispute Settlement Mechanism
EAEU Eurasian Economic Union
EBA Everything But Arms (EU trade preferences for LDCs)
EEA European Economic Area
EFTA European Free Trade Association
EPA E conomic Partnership Agreements (EU trade agreements
with ACP)
FAO Food and Agriculture Organization
ix
x Abbreviations
FATF Financial Action Task Force
FMINCON C onstrained Non-linear Minimization Algorithm in
MATLAB
FSB Financial Stability Board
FTA Free Trade Agreement
GATS General Agreement on Trade in Services
GATT General Agreement on Tariffs and Trade
GDP Gross Domestic Product
GSP Generalised System of Preferences
GVC Global Value Chain
HM Her Majesty
IAIS International Association of Insurance Supervisors
ICP International Comparison Program (mapping international
price differences)
ICT Information and Communication Technology
IIT Intra-industry Trade
ILO International Labour Organization
IMF International Monetary Fund
IOSCO International Organization of Securities Commissions
IPR Intellectual Property Rights
ISDS Investor-State Dispute Settlement
ITU International Telecommunication Union
LDCs Least Developed Countries
MAI Multilateral Agreement on Investment
MFN Most Favoured Nation
MRA Mutual Recognition Agreement
NAFTA North American Free Trade Agreement
NQTM New Quantitative Trade Models
NTM Non-tariff Measures
OECD Organisation for Economic Co-operation and Development
PPP Purchasing Power Parity
PSAs P artial Scope Agreements (between developing countries,
notified under WTO’s enabling clause)
REACH R egistration, Evaluation, Authorisation of Chemicals (EU
chemical regulation)
RO Rules of Origin
RTA Regional Trade Agreement
SACU South African Customs Union