Committee on RTAs Reviews Six Free Trade Agreements, EU Enlargement to 28 Member States

The Committee on Regional Trade Agreements, on 8 April 2014, reviewed six regional trade agreements (RTAs) and the enlargement of the European Union to 28 member states with the accession of Croatia.

The Committee concluded the oral discussion on the following RTAs, based on factual presentations prepared by the WTO Secretariat:

· Chile-Malaysia Free Trade Agreement. In its introduction, Malaysia said this is its first RTA with a Latin American country, and noted that its bilateral trade with Chile had risen by 76 per cent since the implementation of the RTA. Chile said that both countries are already taking part in the Asia Pacific Economic Cooperation (APEC) Forum and in the Trans-Pacific Partnership (TPP) negotiations. It said it wants to expand economic relations with a dynamic region like Southeast Asia. The United States noted that Chile has several RTAs not yet notified to the WTO and hoped these would be notified shortly.

· Canada-Jordan Free Trade Agreement. Canada said this RTA will help strengthen commercial links between the two countries. Jordan said that the RTA, by giving it a transition period to implement tariff cuts, recognizes its status as a developing country. It said that its exports to Canada had risen by 133 per cent since the RTA entered into force. The United States said Jordan has a number of RTAs not yet notified to the WTO which it hoped would be notified soon.

· Canada-Panama Free Trade Agreement. Canada said it views RTAs as a means for establishing a level playing field for Canadian producers. It said that this RTA would allow Canadian companies to participate in government procurement in Panama, including construction projects related to the expansion of the Panama Canal. It said the RTA also contains a non-binding chapter on labour rights recognized by the International Labour Organization (ILO). Panama said that its trade with Canada has risen by 125 per cent since the entry into force of the RTA, and that Canadian investment into Panama has risen by 31 per cent. It said that it has become one of the most dynamic countries in the region through its trade liberalization policies. The United States noted that Panama has a number of RTAs still not yet notified to the WTO and hoped these would be notified soon.

· Korea-Turkey Free Trade Agreement. Korea said that this RTA shows that the two countries have chosen trade liberalization over protectionism in dealing with the economic crisis. It said that negotiations to extend this RTA to services are at an advanced stage. Turkey noted that the RTA provides a transition period for phasing in the tariff cuts. The United States expressed regret at the substantial carve-out of the agriculture sector by both Korea and Turkey. Chinese Taipei said it will be submitting follow-up questions related to technical barriers to trade. Canada said it will be reviewing responses to its questions while the European Union said it had no follow-up questions.

· Central America (Honduras, Nicaragua and Guatemala)-Panama Free Trade Agreement. Honduras, speaking also on behalf of Guatemala and Nicaragua, said that their trade with Panama has increased substantially since the entry into force of the RTA. Panama said that this RTA is part of an ambitious regional integration programme. The United States said it hoped that the parties to this RTA would notify RTAs that have not yet been notified to the WTO.

· European Union-Bosnia and Herzegovina Free Trade Agreement. The European Union said this RTA is part of its Stabilization and Association Agreement with Bosnia and Herzegovina, and related to efforts towards EU accession. Speaking as a WTO observer, Bosnia and Herzegovina said that the RTA promotes economic reforms that would help it in acceding both to the European Union and the WTO. It said that 60 per cent of its trade is with the EU, and that the RTA provides for a five-year transition period for it to cut tariffs. The United States said that the RTA showed a relatively low level of agricultural tariff cuts by Bosnia and Herzegovina.

The Committee also reviewed the enlargement of the European Union to 28 member states with the accession of Croatia. The European Union, also on behalf of Croatia, said that the EU accession represented enormous efforts on the part of Croatia. It said that as part of its EU accession, Croatia’s schedule of concessions in the WTO was withdrawn on 4 July 2013. Since then, the EU had been consulting with a number of members, including Argentina, Australia, Brazil and Uruguay, which have submitted claims for compensation. Uruguay confirmed that it has been meeting with the European Union regarding its claim for compensation.

At the start of the meeting, the outgoing chair, Ambassador Francisco Lima Mena (El Salvador), invited the members concerned to submit information on the implementation of their RTAs, as called for in paragraph 15 of the General Council Decision establishing the RTA Transparency Mechanism.

At the end of the meeting, the Committee elected by acclamation Ambassador Francisco Pirez Gordillo (Uruguay) as the new chair. Ambassador Pirez paid tribute to the leadership of Ambassador Lima Mena during the past year, noting his efforts to encourage members to submit timely information and data on RTAs - an effort which he would continue as chair. Honduras, speaking on behalf of the Latin American and Caribbean Group (GRULAC), also commended Ambassador Lama’s stewardship of the Committee and welcomed the new chair.