Horizontal Depth: A New Database on the Content of Preferential Trade Agreements
Preferential trade agreements (PTAs) have increasingly gained importance in the global economy as more countries look to secure advantageous trade deals with their trade partners. PTAs are agreements between countries that aim to reduce or eliminate tariffs and non-tariff barriers to trade in certain goods or services. These agreements can be bilateral or multilateral and are often negotiated by groups of countries with similar economic interests.
The content of PTAs has become increasingly complex over the years, leading to the creation of a new database known as “horizontal depth.” Horizontal depth refers to the extent to which a PTA covers issues beyond the traditional scope of trade, including topics such as intellectual property rights, environmental standards, and labor regulations.
The horizontal depth of a PTA can have significant implications for its impacts on trade and development. For example, an agreement could include clauses that require participating countries to uphold certain labor standards or environmental protections, preventing a race-to-the-bottom in which countries reduce regulations in an effort to attract investment.
The new database, created by the World Trade Organization (WTO), assesses the horizontal depth of PTAs through a qualitative analysis of the text of the agreement. The database currently includes information on over 200 PTAs, providing a comprehensive resource for researchers and policymakers.
One of the key advantages of the horizontal depth database is that it allows for comparisons between different PTAs. For example, it can help identify which countries or regions are including more comprehensive provisions in their agreements and which issues are being prioritized in negotiations.
Another benefit of the database is that it can help identify areas where PTAs could be improved. For example, if a particular issue is consistently absent from PTAs, policymakers and negotiators could consider including it in future agreements to ensure a more well-rounded and effective agreement.
Overall, the creation of the horizontal depth database is a positive development for those interested in PTAs and their impacts on trade and development. By providing a comprehensive overview of the content of PTAs, this database can help guide policy decisions and promote more effective and equitable trade agreements.