"Though RTAs can bring in benefits to trade and members, the results are not automatic and depend critically on design and implementation. When RTAs have tended to be fruitless, it is often because of the lack of a coherent programme of reforms," chairman and managing director of Exim Bank, T C Venkat Subramanian said while addressing a seminar on 'Role of Regional Trade Agreements,' organised by Industrial Economist.
"RTAs are major instruments for enhancing international trade and can create opportunities through joint action to overcome institutional as well as policy barriers through trade. Thus, it is crucial that RTA is designed and implemented in broader policy context," he added.
The number of these agreements has more than quadrupled since 1990, rising to around 230 by late 2004. The WTO estimates that another 60 agreements are in various stages of negotiation.
Nearly all countries belong to at least one RTA and some are party to numerous agreements.
Trade between RTA partners now makes up nearly 40 per cent of global trade. RTAs can be a complement to multilateral reform, but they are not substitutes and go side-by-side to WTO efforts by cooperating on behind the border policies, trade facilitation and investment climate, he added.