Preferential Trade Agreements and Global Value Chains: Theory, Evidence, and Open Questions

Abstract

The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

Measuring What Matters in Global Value Chains and Value-Added Trade

“…Deepening the knowledge of these mechanisms is also useful for interpreting the short-term dynamics of trade flows. Finally, macroeconomic shocks and trade policies may produce heterogeneous effects on the different trade components, depending on the extent to which they are involved in GVCs (Ruta, 2017;Hofmann et al, 2018;Cook and Patel, 2018).…”

Trade Agreements and Global Value Chains: New Evidence from China’s Belt and Road Initiative

“…On the one hand, GVCs as the internationally dispersed production system have changed the pattern of international trade and cross-border investment for good [8]. Intermediate goods traded in parts and components have increased almost six times in GVCs between 1990 and 2015 [9] as the total foreign direct investment (FDI) has increased about 12 times over the same period [10].…”

“…There are more than 400 free or regional trade agreements now, and almost every economy belongs to at least one of TAs [13]. Preferential trade agreements (PTAs) which have lower trade barriers between member-states [14,15] but not necessarily between countries within the same regions or in regional proximity as RTAs [9] also surged more than 5-folds from 50 in 1990 to about 280 in 2015. At the same time, the content of PTAs has been deepening to include investment and competition policy besides the traditional focus of tariffs [9].According to [16], PTAs are unilateral trade preferences and include Generalized System of Preferences schemes under which developed countries grant preferential tariffs to imports from developing countries, as well as other non-reciprocal preferential schemes granted a waiver by the General Council.…”

“…Preferential trade agreements (PTAs) which have lower trade barriers between member-states [14,15] but not necessarily between countries within the same regions or in regional proximity as RTAs [9] also surged more than 5-folds from 50 in 1990 to about 280 in 2015. At the same time, the content of PTAs has been deepening to include investment and competition policy besides the traditional focus of tariffs [9].According to [16], PTAs are unilateral trade preferences and include Generalized System of Preferences schemes under which developed countries grant preferential tariffs to imports from developing countries, as well as other non-reciprocal preferential schemes granted a waiver by the General Council. PTAs are understood to mean non-reciprocal preferential schemes and distinct from FTAs or RTAs, which are covered by the Transparency Mechanism and defined as reciprocal trade agreements between two or more partners [7,15,17].…”

Acuerdos comerciales profundos y cadenas globales de valor: el caso de Chile, Colombia y Brasil

“…En la literatura se ha argumentado que los cambios en el tipo de comercio que involucra la participación en las CGV modifican los efectos de los instrumentos de política comercial y, con ello, alteran las preferencias de los policy-makers respecto de la aplicación de reformas unilaterales, la búsqueda de acuerdos preferenciales o bien multilaterales (Antrás & Staiger, 2012;Blanchard, Bown & Johnson, 2016). Se han desarrollado también trabajos donde se manifiesta el doble sentido del vínculo aquí estudiado: las CGV como disparadores de la firma de acuerdos, a la vez que la firma de acuerdos profundos como facilitadores del desarrollo de encadenamientos productivos (Orefice & Rocha, 2011;López, 2012;Ruta, 2017;Laget, Osnago, Rocha & Ruta, 2018). Asimismo se puede identificar una vasta literatura respecto a la manera en la que la inserción en las cadenas de valor repercute en el avance de la economía de los países desarrollados y en desarrollo (Baldwin, 2012;Organización Mundial del Comercio [OMC], 2014;Prochnik, 2010;Duran & Zaclicever, 2013).…”