Goal

To ensure Regional Trade Agreements (RTAs) benefit the people by promoting effective stakeholder engagement in both regional integration processes and negotiation of RTAs with external partners.

Scope

Africa is home to some 30 regional trade arrangements (RTAs), many of which are part of deeper regional integration schemes
Regional trade agreements (RTAs) have become increasingly prevalent since the early 1990s.They cover more than half of international trade

South African President Hon J G Zuma signing the Free Trade
Agreement at the COMESA-EAC-SADC summit

and operate alongside global multilateral agreements under the World Trade Organization (WTO). As of 10 January 2013, some 546 notifications of RTAs (counting goods, services and accessions separately) had been received by the GATT/WTO. Of these, 354 were in force. What all RTAs in the WTO have in common is that they are reciprocal trade agreements between two or more partners. 

However, regional trade agreements can have both positive and negative effects.

They can be attractive, for example, because it may be easier for a small

group of neighbouring countries with similar concerns and cultures to agree on market opening in a particular area than to reach agreement in a wider forum such as the WTO. They can also offer new approaches to rule-making and so act as stepping stones on the way to a multilateral agreement.

But regional agreements also risk making it harder for countries outside the region to trade with those inside and may discourage further opening up of markets, ultimately limiting growth prospects for all. Moreover, broad-based multilateral negotiations, with more players and more sectors, will offer greater potential for mutual gain than limited bilateral or regional deals. OECD study has distilled two important lessons to be learnt from RTAs

The first lesson is that many consequences of regional trade agreements activity bolster the case for a strengthened multilateral framework. This applies particularly to the contribution of regionalism to divergence from the rules of the multilateral system, to the effects which the patchwork of regionalism can have on non-members of those agreements and to the role of regionalism in raising transaction costs for business.

These elements are compounded by the fact that regionalism has often failed to crack the hardest nuts. In some particularly sensitive areas, regional initiatives have been no more successful – and in some cases less successful – than activity at the multilateral level. It needs to be acknowledged, however, that even were multilateral disciplines to be strengthened, RTAs, and the provisions embodied in them, would not disappear. The question then arising is how regional arrangements might impinge upon, or co-exist with, any multilateral disciplines.

The second lesson we can draw from experience with regionalism is that while some consequences of RTA activity contribute to the case of strengthening the multilateral framework, there are features of regional approaches that may nevertheless complement such strengthening or even be drawn upon in designing strengthened multilateral rules.

The scope for complementarity arises from the contribution which regional initiatives can make towards harmonisation of rule making; the scope for drawing upon arises from the extent to which RTAs go beyond the WTO. Together, these two elements have yielded highly effective synergies between approaches at the regional and the multilateral levels.

Objectives

African regional trade integration has grown exponentially in the last decade. This programme undertakes comprehensive analysis of the political, economic and legal framework within which it is being pursued. We believe that African Regional Trade Agreements (RTAs) are best understood as flexible legal regimes particularly given their commitment to variable geometry and multiple memberships. We seek to analyse the progress made toward trade liberalization in each region, how the RTAs are financed, their trade remedy and judicial regimes and how well they measure up to Article XXIV of GATT. It covers monetary unions as well as intra-African regional integration, and examines Free Trade Agreements with non-African regions including the Economic Partnership Agreements with the European Union.