May T. Yeung

Bilateral Trade Agreements in the Era of Globalization

Contents: Preface 1. Imagine 2. Preferential Trade Agreements and the Global Trading Environment 3. Indias Engagement with the World Economy 4. The Evolution of EU-India Trade Relations 5. The Indian Clothing and Footwear Industries 6. Non Tariff Barriers 7. Preparing for an India-EU Trade Agreement 8. Oh East is East, and West is West, but What If the Twain Shall Meet? References Index

Accessing US and EU Markets for Nutraceuticals and Functional Foods: Legislative and Technical Barriers Facing Agribusiness Marketers

Abstract Natural health products represent a rapidly expanding and high value segment of the market for agricultural products. Many of these products individually represent niche markets, which present a problem for firms from small market countries-domestic markets will be too small for firms to achieve a minimum efficient size and, as a result, to reach their full potential access to foreign market is required. Canada represents such a market. The international marketing of nutraceuticals and functional foods is characterized by barriers to market access and greatly differing regulatory regimes. The marketing challenges faced by Canadian exporters in two major potential markets, the US and the EU, are examined and a market access strategy that includes a major role for government is outlined.

Regional Integration Theory

The literature on regionalism covers contributions in economics, international relations and political economy. This chapter focuses upon the literature pertaining to the development of regional integration theory. Economic analysis of regions begins with the classic customs unions theories formulated by Viner (1950), Meade (1956) and Lipsey (1957), which have more recently been extended to include imperfect competition by Baldwin (1997b), Schiff and Winters (2002) and others. The traditional theory is contrasted with ‘developmental regionalism’ as espoused by York (1993), Asante (1997) and Page (2000) in reference to developing countries and is still dominant among scholars concerned with regionalism in Africa. The trend towards deeper integration is assessed together with the motivation for integration. Henceforth, the first objective of this chapter is to highlight the development of the theory from the static through to the dynamic and finally to open and developmental regionalism. The second is to identify the impact of trade barriers, both tariff and NTBs, on trade, welfare and competition within RTAs. The chapter firstly maps the evolution of the theory by discussing the motivation for regional integration, its static and dynamic effects and the differing schools of thought on regionalism. Secondly, it examines the negative and discriminatory effects of regionalism and the measures available to offset or reduce these effects. Thirdly, it examines the cost/price effects of barrier removal within a customs union. Lastly, the chapter concludes with an overview of the importance and limits of regionalism.

Regulating Health Foods

With ageing populations, rising incomes and a growing recognition of the link between diet and health, consumers are interested in new food products, supplements and ingredients with purported health benefits. The food industry has responded with new food innovations, formulations and enhancements that comprise the growing health food market, manifesting the need to design regulatory frameworks to govern valid health claims.

Why Maximum Residue Limits for Pesticides are an Important International Issue

The food security challenges that will arise over the next 35 years are outlined. The importance of international trade in meeting food security goals is explained. The threat to trade in agri-food products posed by increasingly asynchronous import regulations for maximum residue limits (MRL) for pesticides is presented. The problems facing MRL harmonization are detailed.

Incentives, or Not, for Governments to Remove Asynchronous MRLs as Trade Barriers

While there are good economic and food security reasons to pursue international harmonization of MRLs, there are constraints on how it can be achieved. Both policy makers and those charged with implementing harmonization face incentives that do not align with the need to eliminate asynchronous MRL regulatory regimes across countries. Progress in harmonization of MRLs has, as a result, proved to be elusive.

What Do Administrators Say

The results of a survey of individual government officials charged with administering MRL policy are reported. Respondents from a variety of countries with divergent policy regimes for MRLs were interviewed. They were asked about their current practices related to MRLs and how progress might be made in achieving regulatory harmonization for MRLs. Their answers were informative regarding both regulatory divergence and how barriers to trade could be reduced.

The Importance of Trade for Food Security

The important contribution international trade has in meeting the food security challenges that will arise in the first half of the twenty-first century is explained. The dual effect of rising population and increasing incomes among the world’s poorest consumers on food demand is outlined. Slowing rates of increase in global agricultural productivity will add to the difficulties in increasing food production. The areas where food demand will increase the most are not where increases in food production can take place, meaning that international movement of foodstuffs must fill the gap.

The Economics of International Harmonization of MRLs

The economics of asynchronous regulations internationally is modeled. The model is used to show the economic costs associated with the persistence of regulatory divergence. Given the economic and food security benefits from international regulatory harmonization, factors that enter into decision-making that are not captured in economic assessments are chronicled.

Institutional Initiatives to Deal with Internationally Asynchronous MRLs

The current initiatives by international institutions to deal with asynchronous regulatory regimes for MRLs are explained. The organizations examined include the Codex, the WTO, APEC, and the OECD among others. Despite considerable efforts in these international fora, progress remains a slow and resource intensive process.