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GTAP Resources: Resource Display

GTAP Resource #7305

"A new mechanism for trade agreement to revitalize the Global Value Chains"
by Jaiswal, Himanshu and Anand Ganesh-Kumar


Abstract
The import tariff system has made a harmful dent on the global trading system. To avoid
this, many countries have chosen the second-best option- ‘an FTA’; because the first-best where there is no tariff at all in the global trading system is close to impossible to achieve. FTAs due to their structural factors like, stringent Rules of Origin and other non-tariff measures have not been very successful. Also, they have been labelled as discriminatory to non-partner countries. Despite having a potential of establishing and strengthening the Global value chains, FTAs have done a dismal work in this dimension too. To overcome this limitation, we propose in this article a new mechanism called ‘Sectoral Trade Agreement (STA)’ which is an FTA among all major producing countries in a particular sector or industry. An STA in automobile sector will be compared with the traditional bilateral FTA with different utilization rate. In our CGE based study, Welfare as a total rises in STA in comparison to FTA scenarios and this is increasing for some non-participating blocks also. It is also shown here how a composite scenario where both FTA and STA are functioning is a better option for trade liberalization and how this is a new ’second-best’.


Resource Details (Export Citation) GTAP Keywords
Category: 2024 Conference Paper
Status: Not published
By/In: Presented during the 27th Annual Conference on Global Economic Analysis (Fort Collins, Colorado, USA)
Date: 2024
Version:
Created: Jaiswal, H. (4/15/2024)
Updated: Batta, G. (4/15/2024)
Visits: 49
- GTAP Data Base and extensions
- Multilateral trade negotiations
- Non-Tariff barriers
- Preferential trading arrangements
- Supply chains


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