International Trade Policy

Access to finance by entrepreneurs is paramount for their business to succeed. The existing microfinance institutions (MFI’s) have tried to bridge the gap of credit accessibility to entrepreneurs but despite this the entrepreneurs have been defaulting on their loans. This study was carried out to analyze the factors influencing loan repayment in micro-finance institutions. The findings will assist the microfinance institutions in coming up with the most appropriate measures to apply in order to eliminate defaults. Descriptive survey was employed with a target population of 39 Loan Officers and 5280 registered MFI clients. A census of 39 loan officers was targeted and a sample size of 360 respondents from registered group members. Stratified proportionate sampling and simple random sampling were employed. Data was collected by use of questionnaires and interviews and analyzed using both descriptive and inferential statistics. The study established that education level, number of dependents, and hobbies were individual characteristics influencing loan repayment. Business characteristics influencing loan repayment were: length of operation, management and type of business. While the lenders characteristics were: groups handled, period taken to qualify new members and the criteria used to evaluate credit worthiness. The study recommends that the government and other stakeholders in the sector should ensure that prospective financial borrowers have access to formal education and training on business management and financing. The MFI’s should reduce the time taken to process a loan application and develop models that are more effective in evaluating credit worthiness of their clients.

Preferential trade agreements (PTAs) increasingly include environmental provisions. While the existing literature documents these provisions' environmental impacts, this paper sheds light on their relation with aid flows. Using an event-specification and data on bilateral Official Development Assistance (ODA) commitments for a sample of 147 developing country recipients in the period from 2002-2017, we find evidence that the number of environmental provisions in PTAs is positively associated with aid during negotiation phases. With high-income countries typically predetermining the extent of environmental provisions in their upcoming PTAs, this suggests that aid serves as a side-payment for recipients to sweeten the pot and agree upon already formulated PTA content. While both aggregate ODA and its subcomponent environmental aid a priori qualify as candidates for pre-signature sidepayments, we find that only the former fulfills this expectation, presumably reflecting more leeway to exploit aid fungibility.

This paper investigates linkages between trade and climate policies by examining commitments made in preferential trade agreements (PTAs) and Nationally Determined Contributions (NDCs) under the Paris Agreement. While environmental protection and economic growth are often perceived as conflicting policy goals, PTAs and NDCs have the potential to encourage mutually supportive approaches to climate and trade governance. Building upon three recent datasets, the paper locates a sample of 21 countries in a typology of four issue-linkage strategies across both types of instruments: policy integration, policy silos, asymmetry in favor of trade policy, and asymmetry in favor of climate policy. It finds that countries that reveal a preference for strong linkage with climate in their PTAs typically do not reveal a preference for strong trade linkage in their NDCs, and vice versa. No state from the sample favors strong policy integration. After sketching out possible explanations for this observation, the paper concludes that policy-makers have significant room for enhancing synergies between trade and climate commitments and that scholars have a role to play in this endeavor.

The international community has acknowledged that international trade can be an effective means of helping to achieve the 2030 Agenda for Sustainable Development and its 17 Sustainable Development Goals (SDGs). Traditionally, preferential trade agreements (PTAs) were designed to promote trade flows. PTAs have become more comprehensive and now also cover non-economic policy areas, such as the environment. This chapter examines whether the inclusion of environmental provisions in PTAs changes the observed overall positive contribution that PTAs make to economic outcomes and thereby to the economic objectives of the SDGs. Specifically, we ask whether the inclusion of environmental provisions in PTAs reduces export flows between PTA partner countries. Using a novel data set on environmental provisions in PTAs, we estimate gravity type panel regressions. We find that membership in PTAs including more environmental provisions is associated with less trade among trade partners compared to PTAs that include less or no environmental provisions. This negative effect of environmental provisions is fully driven by the negative effect on South-North trade flows, i.e. exports from developing to high-income countries.

By focusing on the wider process of negotiations, this volume presents the first systematic analysis of the Transatlantic Trade and Investment Partnership (TTIP).

Contributors include Andrew Gamble, Robert Keohane, Julia Morse, Hartmut Mayer, Andreas Dür, Lisa Lechner, Michael Strange, Vinod Aggarwal, Simon Evenett,  Erick Duchesne, Richard Ouellet, Zhang Xiaotong, Petros C. Mavroidis, Jens Mortensen,  Sophie Meunier, and Joost Pauwelyn

Endorsement by Pascal Lamy, Honorary President of Notre Europe, former Director general of the WTO and European Commissioner for Trade :

"This volume addresses a crucial issue of global and interregional trade governance by including an international team of  leading scholars from a variety of disciplines and viewpoints. Collectively the authors identify the major stakes and provide a comprehensive and highly competent overview of the main political implications of the Transatlantic Trade and Investment Partnership  negotiations from both sides (North America and Europe), while keeping in mind the controversial interplay with global governance and emergent economies. Highly recommended for students, scholars, practitioners and informed citizens looking for critical and solid orientation in a very sensitive and uncertain matter."

The renegotiation of what US President Trump called “the worst trade deal ever” has resulted in the most detailed environmental chapter in any trade agreement in history. The USMCA mentions dozens of environmental issues that its predecessor, the North American Free Trade Agreement (NAFTA), overlooked, and in line with contemporary US practice, brings the vast majority of environmental provisions into the core of the agreement, and subjects these provisions to a sanction-based dispute settlement mechanism. It also jettisons two controversial NAFTA measures potentially harmful to the environment. However, this paper argues that the USMCA only makes limited contributions to environmental protection. It primarily replicates most of the environmental provisions included in prior agreements, and only introduces three new environmental provisions. Moreover, it avoids important issues such as climate change, it does not mention the precautionary principle, and it scales back some environmental provisions related to multilateral environmental agreements.

An increasingly comprehensive set of environmental provisions is being integrated in preferential trade agreements (PTAs). Interestingly, while a number of these environmental provisions are included only rarely, others are duplicated in more than 100 PTAs. We still lack a convincing explanation for the conditions that fuel the uptake of specific provisions. This paper contributes to the growing literature on the design, interaction, and diffusion of international institutions and introduces two key innovations. First, our level of analysis is the provision level rather than the agreement level. Second, while the diffusion literature typically tries to explain how diffusion occurs, we investigate what makes diffusion more likely. We hypothesise that the initial conditions – relating both to agency and institutional factors – under which provisions first emerge determine the scope of their diffusion. Our results indicate that provisions originating from intercontinental agreements diffuse more often, and provisions first introduced by environmentally credible countries are more frequently duplicated than provisions introduced by economically powerful countries.

This policy brief investigates the interplay of two critically important Group of Twenty (G20) agenda items: trade and climate change. We argue that there is significant room for a stronger emphasis on climate-friendly trade measures that are in line with the global trade regime. We believe that the G20 should fully tap into this potential. We recommend (1) using preferential trade agreements to leverage climate action, (2) phasing out fossil fuel subsidies, (3) seeking international cooperation and consensus on the implementation of border carbon adjustments, (4) making use of investment law and, more generally, (5) fostering trade and climate linkages through the G20.

Africa is a vast and diverse continent where discussions of trade integration, as a driver of sustained growth and poverty reduction, have been long-standing. The continent contains an assortment of countries in terms of size, income, and openness. In terms of size, a conglomeration of some seventeen countries have populations of less than 5 million, whereas a single country has a population of over 200 million. Between these two extremes, there is a wide distribution of countries . Although Africa has the world's youngest population and some of the fastest-growing economies in the world , however, unlike other regions that have pursued deep trade integration, attaining deep trade integration has been rather sluggish. Despite this, trade has been the vehicle of socio-economic and political integration of African countries for centuries before the formation of Africa's first regional body, the Organization of African Unity (OAU), in 1963.
Since inception the current dispensation of African Union there has been accelerated efforts to ensure a better trade and economic synergies among Africa countries. The 18th ordinary session of the Assembly of Heads of States and Governments of the African Union, held in Addis Ababa, Ethiopia in January 2012, adopted a decision to establish an African Continental Free Trade Area (AFCFTA) with an indicative date of 2018. The free trade area is to include all fifty-four (54) African countries with a population of more than one billion people and a combined gross domestic product (GDP) of more than  $3.4 trillion. Subsequently, in June 2015, at the twenty-fifth summit of the African Union held in South Africa, negotiations towards the establishment of AFCFTA were launched. The Agreement establishing the AfCFTA was signed on by 44 member states in Kigali Rwanda on March 21, 2018, and it entered into force on 30th May 2019 for 24 countries that had deposited their instruments of ratification. According to Article 23 of the Agreement, entry into force occurs 30 days after the 22nd instrument of ratification is deposited with the Chairperson of the African Union Commission (AUC) – the designated depositary for this purpose.
Nigeria signed on to the agreement on 7th July 2019 during the 12th Extraordinary session of the Assembly of the AU on the AfCFTA in Niamey, Niger, marking the launch of the operational phase of the AfCFTA agreement. Is important to note and acknowledge that the chief negotiator that led the last phase of negotiation to the operationalization the agreement was former and 1st Director-General/ Chief Trade Negotiator of Nigerian Office of Trade Negotiations (NOTN), Late Amb. Chiedu Osakwe, of blessed memory. Even though Nigeria has signed, on to the agreement, Nigeria has not ratified the agreement. Currently, we have 30 countries that have ratified the AfCFTA Agreement. Cameroon and Angola officially approved ratification of the AfCFTA Agreement on 31 October 2019 and 28 April 2020, respectively. Their deposit of these instruments of ratification is pending. However, the commencement of trading using AfCFTA platform has been moved from 1st July 2020 to January 2021 due to the COVID-19 pandemic outbreak. Repositioning businesses in Nigeria to reap the potential benefits of AfCFTA is therefore very imperative before trading commencement under AfCFTA.