I have chosen to adopt the WTO approach of using regional trade agreements for a large number of preferential trade agreements, even if they do not always involve countries in the same region. I will also use them to refer to both unions and free trade agreements, unless there is a reason to distinguish between the two. WTO (2011) “Some figures on regional trade agreements notified and in force at the GATT/WTO,” summary of the tables in the regional trade agreements database. Available under www.coursehero.com/file/p6afvl2/Some-Figures-on-Regional-Trade-Agreements-notified-to-the-GATTWTO-and-in-force/ (available January 4, 2018). It is important to note, however, that these agreements are very different in terms of breadth and depth, the impact on trade and the potential impact on the multilateral trading system. As noted above, the terms of Article XXIV are intended to promote free trade unions and agreements that create more trade than they divert from them. If such goals are achieved, economists generally conclude that these agreements could improve the well-being of participating countries, with limited damage to third parties, and thus contribute positively to the goal of freer world trade. While it is difficult to isolate the effects of trade agreements, it is also possible that ATRs will increase growth and thus increase trade and also provide benefits to outsiders. A detailed analysis of 76 ATRs in the mid-2000s showed that most of them meet the conditions set out in Article XXIV, which remove barriers to all trade (in this case, defined as at least 90% of tariff lines) in at least ten years. However, these and other studies also find that the agricultural sector is often an exception. 17 With regard to customs unions, the agreement instructed the WTO secretariat to assess the potential impact of the common external tariff on external persons. It is important for members to agree that applied and unrelated tariffs should be used in the calculation, which gives a more realistic picture of the potential impact of parties in developing countries that have applied tariffs at levels well above those they normally apply. The agreement also highlighted the procedures that countries should follow when negotiating compensation for third parties whose exports face higher tariffs as a result of the new customs union.
It also reaffirms that Members can use dispute resolution procedures in cases that cannot be resolved through negotiation. For much of the post-war period, the United States accepted European integration efforts on foreign policy grounds, but it itself avoided bilateral and regional trade agreements. In the early 1980s, the United States became increasingly frustrated by the failure to open new GATT negotiations to address unresolved issues during the Tokyo Round (1973-1979). U.S. negotiators concluded the first bilateral free trade agreement with Israel in 1984, and then began negotiations that culminated in a more economically important free trade agreement with Canada in 1988. 12 it was extended to Mexico a few years later and transformed into the North American Free Trade Agreement (NAFTA). The United States is now the partners of 14 free trade agreements with 20 countries. With the exception of 1990, all agreements were concluded with Israel and Canada, including 12 with neighbours in North and South America (Canada and Mexico; five Central American countries, plus the Dominican Republic); Colombia, Panama and Peru).
In North Africa and the Middle East, there is a negotiated rally after the terrorist attacks of September 11, 2001 on the American continent (Bahrain, Jordan, Morocco and Oman), as well as on Australia, the Republic of Korea and Singapore.