Bilateral Trade Agreements under Article XXIV GATT/WTO and the Developing Countries - Essay Example

In this regard, RTAs characterized as customs union and free-trade zones have been permitted as they are perceived as consistent with GATT’s free trade principles since they function to remove virtually all trade barriers between member states that are parties to RTAs of this type.1 RTAs however, have been the subject of aggressive debate primarily because they are seen as counterproductive to the multilateral trade policy and system promoted by the World Trade Organization (WTO) and GATT’s successor.

The primary argument is that Article XXIV of GATT 1947 and now 1994 permits the creation of free-trade zones and customs unions regionally and therefore undermines the functioning of liberalized world trade.2 However, given the trend toward the unpredictable withdrawal of trade preferences by developed countries to developing countries, the RTA has been viewed as a feasible method by which developing countries can gain access to global markets.3 This research study examines the issues relative to Article XXIV with respect to the facilitation of RTAs as an institutional difficulty for the world trade regime.

Ultimately, this research study seeks to identify how these issues can be resolved in favour of developing countries. In this regard this paper is divided into five parts. The first part of this research will offer an introduction to the history and development of Article XXIV. The second part of this research study examines the WTO’s rules for bilateral agreements so as to put Article XXIV in its proper context. The third part of this paper will examine and critique Article XXIV. The fourth part of this research study will identify the attendant problems associated with free-trade zone and customs union RTAs with an emphasis on the developing countries and their respective difficulties within the WTO regime. The