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The gravity model is used extensively to investigate the trade flow effects of Regional Trade Agreements (RTAs). A notable feature common to previous research is the use of aggregate trade data. These studies typically report conflicting, and even negative results of the effect of RTAs on members' trade. Using recent developments in the gravity equation suggested by Baier and Bergstrand (2007) and Anderson and van Wincoop (2003), this article demonstrates that RTA effects on members' trade depend fundamentally on whether the analysis focuses on agricultural or nonagricultural sectors, on the particular agreement analyzed, and on the length of the phase-in period that characterizes almost all RTAs.

Twelve Pacific Rim countries that account for forty percent of world output and more than a quarter of world trade have signed a Trans-Pacific Partnership (TPP) agreement. Assuming that the agreement is ratified and implemented by the signatory countries, the TPP will have important implications for the world trading system. New ground is broken in this mega-regional agreement in a number of areas where progress has not yet been possible in the more comprehensive World Trade Organization negotiations. This paper provides an analysis of the innovations in the agreement, assesses their significance for the broader world trade regime, and considers the feasibility of extending them to the multilateral trading system. Synergistic effects on other ongoing mega-regional negotiations are also considered.

As the world marketplace becomes ever more globalized, much is at stake for the prosperity of hundreds of millions of people in Europe and Central Asia as the region’s transition process continues through its second decade. Understanding the underlying dynamics shaping the contours and most salient impacts of international integration that have emerged—and likely to emerge prospectively—in the region is thus a crucial challenge for the medium term economic development agenda, not only for policymakers in the countries on themselves, but also for their trading partners, the international financial institutions, the donor community and the future of the world trading system as a whole. This book addresses this challenge.

This paper traces the evolution of “discriminatory” international trading arrangements: (i) regional trade agreements (RTAs), which offer their members better access to each other’s markets; and (ii) preferential trade agreements (PTAs), which offer developing and least developed countries (LDCs) nonreciprocal access to certain markets. The number, coverage, and depth of RTAs have increased tremendously in the last 25 years, potentially leading to even deeper integration among dynamic economies. However, countries on the margin of RTA activity may be in danger of not benefitting from the growth in international trade. The number of countries offering PTAs has also increased with many developing countries now providing LDCs with nonreciprocal market access. This significant level of RTA and PTA activity raises serious challenges for countries such as Pakistan, which remain on the margins. Efforts to rectify this should, in the short term, focus on negotiating RTAs with selected countries to build the required capacity for such negotiations and improve Pakistan’s visibility on the RTA landscape. The country must aggressively seek and defend nonreciprocal market access under PTAs, with particular focus on such GSP schemes as offer additional benefits. Medium-term actions should aim to improve competitiveness by investing in infrastructure, energy, and human resources; adopting a coherent and supportive macroeconomic policy framework; and improving law and order. This will help Pakistan enter into and benefit from RTAs with dynamic economies while substantially reducing its dependence on PTAs.

This paper investigates regional trade agreements in Africa by using panel data spanning 1995~2014. Trade creation and diversion effects are assessed through a gravity model estimated using the Eicker–White robust covariance Poisson pseudo-maximum likelihood method. This method proves superior to the usual nonlinear least square estimators, especially against heteroscedasticity and data with zero value. The findings suggest that regional trade agreements may enhance trade. The differences in effects can be matched with the effectiveness in implementation by respective member countries. The trade gains of regional trade agreements do not come at the expense of trade with non-members. By controlling for the duration within a regional trade agreement, we also show that a very small but significant share of the benefits occurs over time in the Economic and Monetary Community of Central Africa, Southern African Development Community, Southern African Customs Union, and West African Economic and Monetary Union. Trade benefits seem to decline over time in the East African Community.

The linkage between international trade regulation and sustainable development is increasingly evident in contemporary regional trade agreements (RTAs). The European Union (EU) has been at the forefront, advocating for the inclusion of trade and sustainable development (TSD) provisions in its regional trade agreements (RTAs) with trading partners, especially with two key Southeast Asian partners, which are Vietnam and Singapore. In contrast, ASEAN’s regional economic integration shows a noticeable absence of TSD concerns. This discrepancy points to differing levels of commitment to TSD provisions in RTAs. For AMSs (AMSs), adopting EU-style TSD provisions could either be welcomed or resisted, making it essential to understand the extent of the EU’s influence. Drawing from Brunnée & Toope’s ‘interactional international law’ perspective, the article examines the EU’s engagement and its influence on AMSs’ understanding of TSD. This article concludes that even if the EU views sustainability as a value to be promoted internationally, this does not necessarily mean that AMSs negotiating TSD provisions will adopt the EU’s approach verbatim. The agency of AMSs in resisting or adapting EU influence should not be overlooked. It is also important to note that some AMSs may incorporate sustainability considerations into their domestic policies, even in the absence of a cohesive ASEAN-level narrative or direct engagement with the EU on trade and sustainability.

The study employs dynamic system GMM estimations to investigate factors influencing tourist travel choices from within Sub-Saharan Africa (SSA). Key determinants include GDP per capita, exchange rates, relative prices, and transportation costs. Globalization, border policies, and regional trade agreements also impact tourism patterns in SSA. Technology development, specifically internet accessibility, plays a pivotal role in destination selection. Surprisingly, results indicate a preference for less urbanized areas among international intra-SSA tourists. The study suggests that motivations for traveling from within SSA are largely similar to those for international tourists. This research provides valuable insights for stakeholders in the tourism industry and lays the foundation for further exploration of this dynamic sector in the region.

From the collective choice perspective, this paper examines how different trade regimes have differing implications for two enemy countries' arming decisions in a three-country world with a neutral third-party state. We compare the two adversaries' aggregate arming (i.e., overall conflict intensity) and show that it is in ascending order for the following regimes: (i) a free trade agreement (FTA) between the adversaries, leaving the third-party state as a non-member, (ii) worldwide free trade in the presence of the interstate conflict, (iii) trade wars with Nash tariffs, and (iv) an FTA between the third country and one adversary, excluding the other adversary from the trade bloc. These results have policy implications for interstate conflicts. First, “dancing between two enemies” with an FTA results in lower aggregate arming than under worldwide free trade. Second, the world is “more dangerous” in tariff wars than under free trade. Third, an FTA between one adversary and the third party while keeping the other adversary as an outsider is conflict-aggravating since aggregate arming is the highest compared to all other trade regimes. We also analyze aggregate arming under a customs union (CU) and discuss differences/similarities in implications between a CU and an FTA for interstate conflicts.

The Pacific Alliance (PA), established in 2011, aims to foster economic integration among its member states—Peru, Chile, Colombia, and Mexico—by promoting trade liberalization and economic cooperation. However, recent political shifts within these countries have influenced trade policies, affecting intra-bloc commerce and relations with external markets, particularly China and the United States. This study explores how the political environment within the PA has shaped sustainable trade, considering economic policies, trade agreements, and shifts in regional priorities. Using a qualitative and descriptive approach, this research is based on a documentary review of academic literature, official reports, and international trade data. Content analysis was applied to assess the impact of political decisions on PA trade sustainability, including the examination of tariff structures, trade flows, and capital movements. The findings indicate that intra-regional trade within the PA remains limited, with an intraregional trade index below 4%. Mexico continues to prioritize exports to the U.S., while Peru and Chile strengthen ties with China. Although PA member states have maintained liberal economic policies, disparities in trade liberalization levels hinder integration. Furthermore, despite the reduction of tariffs and the implementation of digital trade facilitation measures, political instability and differences in economic strategies among member states challenge the PA’s long-term sustainability. Strengthening institutional frameworks and increasing investments in research and development are crucial for enhancing economic integration and ensuring trade resilience within the bloc.