Termites In The Trading System: How Preferential Agreements Undermine Free Trade (council Of Foreign Relations)
by Jagdish Bhagwati /
2008 / English / PDF
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Jagdish Bhagwati, the internationally renowned economist who
uniquely combines a reputation as the leading scholar of
international trade with a substantial presence in public policy on
the important issues of the day, shines here a critical light on
Preferential Trade Agreements, revealing how the rapid spread of
PTAs endangers the world trading system.
Jagdish Bhagwati, the internationally renowned economist who
uniquely combines a reputation as the leading scholar of
international trade with a substantial presence in public policy on
the important issues of the day, shines here a critical light on
Preferential Trade Agreements, revealing how the rapid spread of
PTAs endangers the world trading system.
Numbering by now well over 300, and rapidly increasing, these
preferential trade agreements, many taking the form of Free Trade
Agreements, have re-created the unhappy situation of the 1930s,
when world trade was undermined by discriminatory practices.
Whereas this was the result of protectionism in those days,
ironically it is a result of misdirected pursuit of free trade via
PTAs today. The world trading system is at risk again, the author
argues, and the danger is palpable.
Numbering by now well over 300, and rapidly increasing, these
preferential trade agreements, many taking the form of Free Trade
Agreements, have re-created the unhappy situation of the 1930s,
when world trade was undermined by discriminatory practices.
Whereas this was the result of protectionism in those days,
ironically it is a result of misdirected pursuit of free trade via
PTAs today. The world trading system is at risk again, the author
argues, and the danger is palpable.
Writing with his customary wit, panache and elegance, Bhagwati
documents the growth of these PTAs, the reasons for their
proliferation, and their deplorable consequences which include the
near-destruction of the non-discrimination which was at the heart
of the postwar trade architecture and its replacement by what he
has called the spaghetti bowl of a maze of preferences. Bhagwati
also documents how PTAs have undermined the prospects for
multilateral freeing of trade, serving as stumbling blocks, instead
of building blocks, for the objective of reaching multilateral free
trade. In short, Bhagwati cogently demonstrates why PTAs are
Writing with his customary wit, panache and elegance, Bhagwati
documents the growth of these PTAs, the reasons for their
proliferation, and their deplorable consequences which include the
near-destruction of the non-discrimination which was at the heart
of the postwar trade architecture and its replacement by what he
has called the spaghetti bowl of a maze of preferences. Bhagwati
also documents how PTAs have undermined the prospects for
multilateral freeing of trade, serving as stumbling blocks, instead
of building blocks, for the objective of reaching multilateral free
trade. In short, Bhagwati cogently demonstrates why PTAs areTermites in the Trading System.
Termites in the Trading System.