Preferential Trade Agreements
Economic Integration
Syllabus requirement
Agreements that give preferential access to certain products from participating countries. These may take the form of bilateral trade agreements between two countries, regional trade agreements among a group of neighboring or connected countries, or multilateral trade agreements involving many countries, such as those under the World Trade Organization (WTO).
Summary
This topic explains preferential trade agreements (PTAs) as a form of economic integration where countries agree to reduce or remove trade barriers to make trade easier between members. It describes the main types of PTAs — bilateral, regional (RTA) and multilateral (under the WTO) — and why governments use them, including increased competition, greater efficiency for producers and more choice and lower prices for consumers.
