The inception of the African Continental Free Trade Agreement (AfCFTA) constitutes a major advancement in Africa's economic integration process. Diverging from what appears to be the norm in contemporary trade treaties, the agreement adopts a conditional Most Favoured Nation (MFN) clause hinged on the principle of reciprocity. Without the promise to reciprocate preferential treatment, the beneficiary state does not assume the right to demand MFN treatment. In broader discussions, this feature has been criticized for possessing the tendency to restrict trade. However, examining it in the context of Africa's trade paradigm, this paper argues that the non-automaticity of the AfCFTA's MFN clause is a cardinal feature safeguarding its existence.

Brazil has changed its negotiation strategy in World Trade Organization (WTO) negotiations. In the first half of the WTO era (1995–), Brazil adopted a strong developing country leadership role as coordinator and spokesperson of the G20 group of developing countries. More recently, however, this group has disappeared from the negotiation scene. This article examines how Brazil has departed from a 2000 status quo and arrived at a more flexible approach, less reliant on the industrialized-developing divide as a structuring principle of its diplomacy. Using WTO negotiation documents, trade delegate interviews, dispute settlement case law, and secondary literature, I outline the contours of new directions in Brazilian trade policy. These include joint legislative initiatives with the EU, a move towards the plurilateral level on non-traditional issues, a greater heterogeneity of dispute settlement targets, and a newly flexible handling of its rights under the WTO's special and differential treatment status. The article contributes to ongoing debates on Brazil's status in international affairs, its reliance on large coalitions, and the maintenance of followership as key directives of its foreign policy, and scholarship that sees Brazil as stuck in a ‘graduation dilemma’.

While the theory of economic policy offers a potential framework for thinking about the joint pursuit of economic objectives (EOs) and non-economic objectives (NEOs), over time the theory of economic policy was formalized in a way that considers NEOs as constraints that are given, rather than as goals that may themselves be endogenous alongside EOs. We examine the analytical treatment of NEOs as co-determined with EOs, revisiting some of the ground broken by Alan Winters in his analysis of NEOs. We review the place of NEOs in the theory of economic policy, discuss current practice in the representation of such objectives as exogenous constraints, and develop an argument for representation of NEOs as objectives in themselves.

This article examines a significant question in navigating trade and climate tension: how to recognize another country as having equivalent climate regulations. Such equivalence forms a core component of many proposed models of so-called climate clubs. Establishing equivalence between distinct national climate regulation regimes poses a unique challenge that draws upon both trade and environmental international cooperation. Drawing on existing proposals, I examine prospects for country-based cooperation through three models: ETS-linking, benchmarking of shared methods and minimum standards, and benchmarking of outcome duties. The analysis concludes that all models necessitate some trade-offs between the goals of rigorous oversight of climate objectives, inclusivity, and WTO compliance. Benchmarking of shared methods and minimum standards seems most feasible, and would provide a deeper level of integration between trade and climate cooperation, but necessitates a shift in how countries, particularly the EU, oversee regulatory compliance.

Alan Winters was the editor of the World Trade Review (WTR) from December 2008 to mid-2020. Launched in 2002 as a joint initiative of the WTO Secretariat and Cambridge University Press, the WTR has become the leading multidisciplinary journal in the field of international trade broadly defined. In the period during which Alan was editor of the journal, the number of issues grew from three to five, reflecting the significant increase in the number of quality submissions. The impact factor of the journal rose to 1.6 in 2020, an increase by 150%, above that of The World Economy, arguably the incumbent in the field when the WTR was created.

The degree to which firms make use of preferences in exporting to a partner country under a Free Trade Agreement will in good part depend on the restrictiveness of the underlying Rules of Origin (ROOs). Focusing on the post-Brexit Trade and Cooperation Agreement (TCA) signed by the United Kingdom and the European Union, we examine how access to zero preferential tariffs has been impacted by ROOs. We do so by constructing a ROO restrictiveness index which varies across products. We find that the TCA has an overall moderate degree of ROO restrictiveness. Using product-country level trade data, we find that preference utilization under the TCA has risen over time, and exhibits a positive correlation at the product level with the EU Common External Tariff. Regressions on the determinants of preference utilization indicate that more restrictive ROOs are associated with a lower degree of preference utilization by UK firms in the EU market and this effect is more evident for consumption goods. Preference utilization is also driven by the size of the preferential margin, the size of the trade flows, and the extent to which exports are undertaken by producers as opposed to distributors, as well as the degree of firms’ engagement in value chains.

The 1980s and 1990s saw a policy revolution in developing countries in which many highly protected (if not closed) economies were opened to world trade. These reforms were largely undertaken unilaterally, but international economic institutions such as the World Bank, the International Monetary Fund, and the General Agreement on Tariffs and Trade/World Trade Organization supported these efforts. This paper examines the ways in which these institutions promoted, or failed to promote, trade policy reform during this pivotal period.

We analyse the ‘indirect effects’ of Brexit on African, Caribbean, and Pacific (ACP) countries’ exports that use the UK as a platform to access the EU market and vice versa. First, we use the EORA26 multi-region input–output database for 186 countries and 26 sectors to characterize the ACP domestic content embedded in bilateral trade between the UK and the EU. Second, we apply the GTAP-VA module to carry out a simulation of how the EU–UK Trade and Cooperation Agreement will impinge on 121 countries and 65 products. The results suggest that while ‘indirect effects’ on ACP countries’ exports may exist, their economic magnitude is small in aggregate because ACP countries supply only small amounts of inputs used in UK–EU bilateral trade. Our simulations also show that these effects may be offset by the likely increase in ACP domestic content in exports because of TCA friction, mainly towards the UK.

Globalization and robotics (globotics) are jointly transforming the world economy at an explosive pace. While much of the literature has focused on rich nations, the changes are quite likely to affect developing nations in important ways. The premise of the paper – which should be regarded as a thought-piece – is based on an extreme thought experiment. What does development look like when digital technology has rendered manufacturing jobless and many services freely traded? Our conclusion is that the service-led development path may become the norm rather than the exception; think India, not China. Since success in the service sector is based on quite different factors than success in manufacturing, development strategies and mindsets may have to change. This is an optimistic conclusion since it suggests that developing nations can directly export the source of their comparative advantage – low-cost labour – without having first to make goods with that labour.

Using trade policy to achieve foreign policy objectives, such as stable international relations, has a long history, from Kant to the founders of the GATT. Punishing enemies and rewarding ‘friends’ by granting or withholding market access is also not new, and sanctions or blockades are a venerable form of trade policy used as foreign policy. A more recent form is influencing the domestic policy of another country with non-commercial provisions in trade agreements. All these tools are based on linkage, on the assumption that a desired outcome can be achieved by interventions that would increase or decrease trade. The latest instance is so-called ‘friend-shoring’, which would in principle isolate enemies, although it will be difficult in practice and risks undermining multilateralism. The cost of these interventions is susceptible to economic analysis, even if the conclusion is that it is worth paying. Influenced by Alan Winters who referred to national security as a motivation for agriculture protection as a ‘so-called non-economic objective’ or SNO, I argue that using a trade policy tool for a foreign policy purpose as if there is no cost is a SNO job, an attempt to justify an intervention aimed at one objective by framing it as being valuable for another.

This paper develops a Heckscher−Ohlin model in which the effects on production structure of endowments and changes in trade policies depend in a continuous way on a country's degree of openness to trade. Its main contribution is to show semi-formally how the introduction of product differentiation causes the elasticities of output with respect both to factor endowments and to sectoral trade barriers to vary with import penetration (the share of foreign firms in home markets) and export orientation (the share of foreign markets in home-firm sales).

Over the past three decades, tariff protection to farmers has fallen and partly been replaced by domestic support, whilst support for farmers in some emerging economies has grown. Against that backdrop, this paper provides new estimates of national economic impacts of global agricultural tariffs and domestic supports. Using the latest global economy-wide GTAP (Global Trade Analysis Project) model calibrated to 2017, we simulate (a) the removal of food and agricultural domestic supports and agri-food tariffs and (b) the removal also of tariffs on imports of non-agricultural goods. We find that agricultural support policies are still an important part of the global welfare cost of all goods’ trade-restrictive policies (albeit only half as costly as in 2001), and tariffs still dominate the global welfare cost of all farm-support programs. That farm support could be re-instrumented to relieve natural resource and environmental stresses, boost food and nutrition security, and alleviate poverty and income inequality.

With a modified formalization of Heckscher–Ohlin theory as the basis of a novel econometric specification, this paper uses worldwide data over three decades to estimate how the effects of greater openness on industrialization vary among countries with differing endowments of land relative to labour. The results confirm the theoretical prediction that greater openness reduces manufactured output shares in land-abundant countries, while increasing them in land-scarce countries. The implications of these results for trade and development policy are debatable.

The recent change towards advanced technologies favors skill-intensive labor, motivating workers to upgrade their educational achievements to the tertiary level. However, workers in many developing countries cannot exploit the opportunity for premium wages in skill-intensive sectors owing to insufficient education facilities and resources. In such contexts, aid to education provides a capacity-building tool to eliminate the insufficiency but is often unsuccessful. Using theories of trade and human capital, this study argues that complementarity between education aid and skill-intensive manufactured exports creates a synergistic effect in upgrading educational achievements by rectifying both structural and incentive constraints. Through extensive data analysis, the result demonstrates that skill-intensive exports enhance aid's effectiveness in increasing tertiary school enrollment, whereas neither exports nor aid alone significantly affect enrollment. It further shows that the aid–export complementarity is less relevant in low-income countries, whereas skill-intensive exports alone promote education upgrading in developed countries via the Stolper–Samuelson effect.

This Article identifies the problems of an Appellate Mechanism for ISDS Tribunals in relation with its possible benefits. We propose the inclusion of certain design features to improve the working of an eventual Appellate Mechanism and help mitigate problems related to procedural, conflict resolution, and substantive concerns. We finish by identifying the most central problems with a possible Appellate Mechanism, which helps to narrow down options within the ongoing reform process at UNCITRAL. Overall, we illustrate how institutional choice is always contextual and that all institutional options are imperfect and subject to important trade-offs.

This paper examines the legal ramifications of using tariff flexibility arising from GATT unbound tariff lines or tariff overhangs under both WTO and preferential trade agreement (PTA) law when flexibility is exercised preferentially for PTA partners. Under WTO law, a WTO member that is a party to a PTA under GATT Article XXIV is required to use tariff flexibility on a non-discriminatory basis. However, PTA obligations including tariff elimination commitments and a standstill clause prohibit the WTO member from raising applied tariffs on imports from the PTA parties, thereby preventing the use of tariff flexibility on a non-discriminatory manner. In contrast, a WTO member entering into a PTA under the Enabling Clause may use tariff flexibility discriminatorily without violating WTO law. A WTO member has greater legal latitude in utilizing tariff flexibility if it forms a PTA under the Enabling Clause rather than under GATT Article XXIV. The discriminatory exercise of tariff flexibility by some WTO members in conformity with PTA obligations, but in violation of WTO law, is further evidence of the fragmentation of the world trading system, where WTO law is facing its limits.

To preserve the functioning of WTO dispute settlement following the blockage of the Appellate Body, a sub-set of WTO Members created the Multi-Party Interim Appeal Arbitration Arrangement (MPIA). In the wake of the first appeal award rendered under the MPIA, this contribution describes how the MPIA process works and lists some of the innovations that can be found in the first MPIA procedure. More innovations can be expected as arbitration under Article 25 of the Dispute Settlement Understanding (DSU) (be it ad hoc or under the MPIA) can be adjusted and molded case-by-case by the disputing parties in their appeal arbitration agreements. In this sense, the MPIA can serve not only as an interim stop-gap to preserve WTO dispute settlement. It can also function as a laboratory to explore and test new ways of making WTO dispute settlement more efficient and in line with WTO Members' goals and interests: experimental reform by doing, rather than one-off, formal DSU review.

Failure to reestablish an effective World Trade Organization (WTO) dispute settlement procedure, stop the erosion of multilateral rules and end the China–US trade war causes capitals to rethink trade policy. One response is to redouble efforts to strike trade agreements with major trading partners. Already countries accounting for about 78% of world Gross Domestic Product (GDP) are members of mega-regional agreements, and based on our computations, preferential trade agreements (PTAs) will soon cover about two-thirds of world trade. Can PTAs replace a fading WTO or mitigate its effects? Amid deepening geopolitical rifts, how will trade relations among China, the EU, and the US, each a hegemon in their respective regions, evolve, and what will be the impact on smaller economies? In short, how will a trading system based increasingly on PTAs and weak multilateral rules look, and how will nations adapt? Absent reforms, the trading system is likely to fragment progressively into regional blocks organized around the hegemons. Trade within the regional blocks, mainly conducted under a mega-regional agreement, will likely remain quite open and predictable, but without strict multilateral rules and where PTAs are absent (as they are among the hegemons), interregional trade relations will become increasingly uncertain and unstable.

This paper offers a comprehensive study of the jurisprudence on the ‘as a result of unforeseen developments’ test under the WTO's safeguards (SG) rules. It contributes to the existing scholarship by making three fresh arguments. First, the Appellate Body's decision to ‘revive’ this test as a prerequisite for the application of SG measures is not necessarily incompatible with the drafting record of the SG Agreement, even though this agreement does not make explicit reference to the test. Second, the test is not excessively difficult to satisfy under the standard of review established by case law, even though governments failed to pass it in almost all SG disputes to date. Third, in sharp contrast, the recent US–Safeguard Measure on PV Products decision took a strikingly more deferential approach which fell far short of the established standard of review, leading to the first and only decision in which the test was found to be satisfied. This decision has arguably created a new standard which could lead to abuse of SG measures and damage to the dispute settlement system and hence should be avoided in future disputes.