The Regional Trade Agreements (RTAs) are in disagreement with the guiding principles of the World Trade Organisation (WTO).
This was stated by Federation of Pakistan Chambers of Commerce and Industry (FPCCI) Vice-President and In-charge of WTO Resource Centre, Engr M.A. Jabbar, in his lecture to the officers of Commerce and Trade Group, Commerce organised by the Foreign Trade Institute of the organised by the Foreign Trade Institute of the Commerce Ministry.
He said that RTAs allowed by provisions of WTO do not reconcile with Most Favoured Nation (MFN) clause, whereby all contracting parties of WTO are bound to grant it to each other, as they give to any other country.
The lectures are intended to build capacity of the officers of commerce and trade group in order to upgrade their understanding to facilitate the business of the country by integration and implementation of fiscal, monetary, social and other business governance regulations based on WTO, he added.
The background of RTAs and their emerging concept protected by the WTO was introduced in the lecture.
From the beginning of formation of regional blocs for economic co-operation were also given in chronological order with time travel in the lecture.
The relevant provisions of GATT allowing establishment of regional co-operation through regional trade agreements were discussed with the participants pertaining to their importance and development aspects.
Engr Jabbar said that though the net of the provisions of the WTO do not allow the pattern of present development of RTAs restricting trade members other than those of the RTA club, still the proliferation of RTAs continue due to increasing business amongst the RTA members.
He said both the Doha development agenda and the revised draft of the Cancun ministerial conference have stressed the need for accelerating the work on the clarification and improvement in RTA disciplines under existing WTO provisions, taking into account the development aspects of the RTA.
The travel from Doha to Cancun has remained wishful thinking to discipline the RTAs for conducting transparent business in the global trade within RTAs allowed by the WTO framework, he added.
He gave statistical positions of different regional agreements and intra-regional trade, which show that the development aspects have remained bright, and they are on the rise so the least will be concerned for disciplining the RTAs to allow access to similar conditions of trade for WTO members out of the RTAs.
Engr Jabbar said Pakistan's development position on RTAs has been very insignificant which may consider multi-lateral as the better option in the present situation to take the share of opportunities promised in the global economy.
On the study of expected impacts on economy of Pakistan with increased activities in RTAs, he discussed the present business profiling of Pakistan as the base for analysing the gain theory expectations, he said, adding the export and import being limited with inter alia weaknesses is also another reason that with all the best efforts the eventual best results will take a long time to arrive.
Even TIFA signed by USA requires passing through a net. With countries like Sri Lanka, Bangladesh and Kenya, Pakistan is yet to move forward to increase its business, he said.
The FPCCI VP said that the impact on the economy of Pakistan may be examined in the context of our present import and export volumes, their nature and their originating and landing destinations.
Imports are highly inelastic and bilateral trade arrangements or agreements on the basis of market access, the exports have little room to improve.
However, being optimistic, the market access with further concessional positions of tariffs taken by bilateral and regional agreements could increase the competitiveness of our products to affect the share of exports on the positive side against similar imports from other sources in the country in which we are preferentially treated member, he said.
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