Regional trade agreements (RTAs) are an integral part of international trade, accounting for almost half of world trade and expected to grow further in the next few years. These agreements operate alongside global multilateral agreements under the World Trade Organization (WTO), and have both positive and negative effects.
You’ve got to wonder at the nerve of New Zealand trade officials. During the furtive Multilateral Agreement on Investment negotiations and the subsequent international waves of opposition they were quietly hatching binding bilateral investment deals containing provisions resembling some of the most controversial elements of the MAI.
The recent explosion of bilateral investment and trade agreements and investor-state disputes is of growing concern. Many mobilisations against the World Trade Organisation (WTO) aim to stop attempts by industrialised countries to kickstart talks on a multilateral investment agreement at September’s Cancun Ministerial meeting.
Bilateral agreements are a powerful but hidden tool to achieve uniform market conditions for transnational corporations in developing countries. Silently hammered out between individual governments, they offer a direct means to cut deals over market access privileges, foreign investment, research funding or anchor-free profits.