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Preferential Market Access Design: Evidence and Lessons from African Apparel Exports to the US and to the EU

Author

Listed:
  • Jaime DE MELO

    (Ferdi)

  • Alberto PORTUGAL-PEREZ

    (FERDI)

Abstract
Least developing countries (LDC) rely on preferential market access which is mechanically eroded by the tariff reductions by grantor countries to other countries. Effective market access depends on the severity of the Rules of Origin that have to be met to qualify for these preferences. These Rules of Origin have turned out to be complicated and burdensome for LDC exporters. Since 2001, under the US Africa Growth Opportunity Act (AGOA), 22 African countries exporting apparel to the US can use fabric from any origin and still meet the criterion for preferential access (single transformation), while the European Union continued to require yarn to be woven into fabric and then made-up into apparel in the same country (double transformation).

Suggested Citation

  • Jaime DE MELO & Alberto PORTUGAL-PEREZ, 2012. "Preferential Market Access Design: Evidence and Lessons from African Apparel Exports to the US and to the EU," Working Papers P47, FERDI.
    • Handle: RePEc:fdi:wpaper:424
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    File URL: http://www.ferdi.fr/sites/www.ferdi.fr/files/publication/fichiers/P47_DeMelo_PortugalPerez_Web.pdf
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    References listed on IDEAS

    as
    1. Miriam Manchin, 2006. "Preference Utilisation and Tariff Reduction in EU Imports from ACP Countries," The World Economy, Wiley Blackwell, vol. 29(9), pages 1243-1266, September.
    2. Cherkashin, Ivan & Demidova, Svetlana & Kee, Hiau Looi & Krishna, Kala, 2015. "Firm heterogeneity and costly trade: A new estimation strategy and policy experiments," Journal of International Economics, Elsevier, vol. 96(1), pages 18-36.
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    4. Joseph Francois & Bernard Hoekman & Miriam Manchin, 2006. "Preference Erosion and Multilateral Trade Liberalization," The World Bank Economic Review, World Bank, vol. 20(2), pages 197-216.
    5. de Melo, Jaime & Portugal-Perez, Alberto, 2008. "Rules of Origin, Preferences and Diversification in Apparel: African Exports to the US and to the EU," CEPR Discussion Papers 7072, C.E.P.R. Discussion Papers.
    6. J. M. C. Santos Silva & Silvana Tenreyro, 2006. "The Log of Gravity," The Review of Economics and Statistics, MIT Press, vol. 88(4), pages 641-658, November.
    7. Krueger, Anne O., 1997. "Free trade agreements versus customs unions," Journal of Development Economics, Elsevier, vol. 54(1), pages 169-187, October.
    8. Olivier Cadot & Céline Carrère & Jaime de Melo & Alberto Portugal-Pérez, 2005. "Market Access and Welfare under Free Trade Agreements: Textiles under," The World Bank Economic Review, World Bank, vol. 19(3), pages 379-405.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Azmeh, Shamel, 2015. "Transient global value chains and preferential trade agreements: rules of origin in US trade agreements with Jordan and Egypt," LSE Research Online Documents on Economics 64601, London School of Economics and Political Science, LSE Library.
    2. Fabien Forge & Jason Garred & Kyae Lim Kwon, 2021. "When are Tariff Cuts Not Enough? Heterogeneous Effects of Trade Preferences for the Least Developed Countries," Working Papers 2106E, University of Ottawa, Department of Economics.
    3. Tanaka, Kiyoyasu & Fukunishi, Takahiro, 2022. "Rules of origin and exports in developing economies: The case of garment products," Journal of Asian Economics, Elsevier, vol. 82(C).
    4. Souleymane Coulibaly, 2017. "Differentiated Impact of AGOA and EBA on West African Countries," World Bank Publications - Reports 35742, The World Bank Group.

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    More about this item

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F15 - International Economics - - Trade - - - Economic Integration

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