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Preferential Trading Arrangements in Agricultural and Food Markets

The Case of the European Union and the United States

Preferential Trading Arrangements in Agricultural and Food Markets by Organisation for Economic Co-operation and Development
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Preference erosion has become an important issue in the current WTO trade negotiations as developing countries are concerned that multilateral tariff reductions will harm their agricultural sectors.  The findings in this report suggest that although this may indeed be a problem for some countries in some sectors, factors other than preferential schemes may be limiting developing country exports.

This study finds that preference utilisation rates for selected non-reciprocal agreements are generally high.  Taken individually, the utilisation rate for some schemes may seem low, but that is mostly due to the fact that certain products are eligible for preferential treatment under more than one scheme.  The fraction of agricultural and food exports by developing countries that does not benefit from trade preferences represents only a small proportion of eligible preferences.  But, for certain countries, especially the least developed, import flows induced by such preferences are very small. 

The report provides information on the extent to which developing countries have utilised selected, non-reciprocal preferential trading schemes provided by the EU and the US.  Secondary data are complemented by interviews with market operators further clarifying the empirical findings.  A special section has been devoted to the preferences granted to African countries highlighting the conditions for this set of developing countries.

Organisation for Economic Co-operation and Development; January 2005
185 pages; ISBN 9789264009332
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Title: Preferential Trading Arrangements in Agricultural and Food Markets
Author: Organisation for Economic Co-operation and Development