REGIONAL WORKSHOP ON TRADE AND ENVIRONMENT FORASIA AND PACIFIC ECONOMIES
18-19 SEPTEMBER 2017, COLOMBO, SRI LANKA
RAJAN SUDESH RATNA
ECONOMIC AFFAIRS OFFICER
TRADE AND INVESTMENT DIVISION, ESCAP
PRESENTATION STRUCTURE
• DISCUSSIONS
• CONCEPTUAL FRAMEWORK
• ASIA-PACIFIC RTAs
• PROVISIONS IN RTAs
• SOME EVIDENCES
• WAY FORWARD
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DISCUSSION POINTS
• WHAT IS YOUR EXPERIENCE/OBSERVATION
ABOUT RTA PROVISIONS ON ENVIRONMENT?
• DID YOU LOOK AT LIBERALISATION IN THE
CONTEXT OF ENVIRONMENT OR GENERAL
LIBERALISATION:
• YOUR BILATERAL AGREEMENTS
• ASEAN
• ASEAN +1 AGREEMENTS
• SAARC
• RCEP
• TPP
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RVCS AND GVCS
• MULTILATERAL AND REGIONAL TRADE LIBERALISATION
CAN PROMOTE THE REGIONAL AS WELL AS GLOBAL VALUE
CHAINS, AS THEY HAVE COMMITMENTS TO:
• MARKET ACCESS:
• GOODS
• SERVICES
• INVESTMENTS
• COOPERATION AREAS
• NON-TARIFF MEASURES
• RULES OF ORIGIN IN RTA
• INTRA-INDUSTRY TRADE
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Source: WTO website, 24 April 2017, https://www.wto.org/english/tratop_e/region_e/regfac_e.htm
ASIA-PACIFIC RTAS
• AS OF JULY 2016, THERE WERE 260 RTAS IN ASIA-
PACIFIC REGION WHICH ARE EITHER IN FORCE,
SIGNED OR BEING NEGOTIATED.
• GLOBALLY 267 “PHYSICAL” RTAS IN FORCE, AND
169 (63%) ARE FROM AP
• 12 - SIGNED BUT NOT IMPLEMENTED
• 78 - UNDER DIFFERENT STAGES OF NEGOTIATIONS.
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CUMULATIVE NUMBER OF PTAS (NOTIFIED AND NON-NOTIFIED TO WTO) PUT INTO FORCE BY ASIA-PACIFIC ECONOMIES, 1971-
JULY 2016
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0
20
40
60
80
100
120
140
160
197
3
197
6
197
7
198
1
198
3
198
9
199
1
199
2
199
3
199
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
Developing-Developing Developing-Developed Developed-Developed
Source: ESCAP (APTIR 2016) - calculation based on data from APTIAD
CUMULATIVE NUMBER OF PTAS (NOTIFIED AND NON-NOTIFIED TO WTO) PUT INTO FORCE BY ASIA-PACIFIC
ECONOMIES, 1971-JULY 2016
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0
20
40
60
80
100
120
140
160
197
3
197
6
197
7
198
1
198
3
198
9
199
1
199
2
199
3
199
4
199
5
199
6
199
7
199
8
199
9
200
0
200
1
200
2
200
3
200
4
200
5
200
6
200
7
200
8
200
9
201
0
201
1
201
2
201
3
201
4
201
5
201
6
Within subregion* Within Asia-Pacific Outside Asia-Pacific
Source: ESCAP (APTIR 2016) - calculation based on data from APTIAD
BREAKDOWN OF TRADE AGREEMENTS, BY TYPE AND NUMBER OF PARTNERS
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9
Source: ESCAP (APTIR 2016) - calculation based on data from APTIAD
TPP
SAFTA/SATIS
EU
Jordan
United
States
of
America
@
Bloc-to-bloc or bloc-to-country Country-to-country Under negotiation, awaiting ratification
Taiwan, Province
of China
Macao, China
Egypt
*Not all members shown / @Withdrawals: PNG (PACER Plus) ; USA (TPP)/ PTAs not represented: GSTP, D-8 PTA and PTN (in force) and TPS/OIC (under negotiation) / ** Suspended
Georgia
Hong Kong, China
PICTA*
IsraelMauritius
Serbia
MERCOSURArgentina-Brazil–
Paraguay-Uruguay
Trans-Pacific SEP
CISFTA
ECO
Papua New
Guinea@ Fiji
MSG*
Morocco
Mongolia
APTA
China
SACUBotswana
Lesotho
Namibia
South Africa
Swaziland
Ecuador
SPARTECA*/
PACER Plus*
Pakistan
Maldives
Afghanistan
BIMSTEC
Islamic
Republic
of Iran
Republic of
Korea
Colombia
Canada
PeruMexicoChile
Australia New
Zealand
ASEAN
ECONOMIC
COMMUNITY
CEZ
Republic
of Moldova
GUAM
Customs
Union
Armenia
Azerbaijan
Panama
Costa RicaCentral America*
GCC*
Bahrain
Other Turkey’s
PTAs:
• Albania
• Bosnia and
Herzegovina
• Former
Yugoslav
Republic of
Macedonia
• Montenegro
• State of
Palestine
• Syria**
• Tunisia
Other Turkey’s
negotiations or
PTAs awaiting
ratification:
• Cameroon
• Democratic
Republic of
the Congo
• Faroe Islands
• Ghana
• Kosovo
• Lebanon
• Libya
• Seychelles
EAEU
Russian
Federation
Kazakhstan
Kyrgyzstan
Tajikistan
Uzbekistan
EFTA*
Switzerland
Norway
Iceland
RCEPTurkmenistan
CIS
1994
Japan
Ukraine
Negotiations
Japan-China-
Rep. of
Korea
Sri Lanka
BangladeshNepal
Bhutan
India
Turkey
Belarus
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PRESENT RTAs: ISSUES COVERED
Goods ServicesNon-Tariff
BarriersInvestment
Competition Labour Mobility EnvironmentLabour
standards
Government Procurement
E-commerceIntellectual
Property RightsDispute
Settlement
Customs cooperation/
Trade FacilitationMRAs
Technical Assistance
Areas of cooperation
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0% 100%
Labour
Accession
Environment
Tariff-rate quotas
Denial of benefits
Government procurement
Domestic regulation
Mutual recognition (services)
Investment
Subsidies
Competition
Balance of payments measures
Export restrictions
Countervailing measures
Sanitary and phytosanitary measures
Anti-dumping measures
Technical regulations, standards, technical barriers to trade
Intellectual property rights
Safeguard measures
Customs-related procedures
Rules of origin
Dispute settlement
Exceptions, general or for security
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ASIA-PACIFIC RTAS AND ENVIRONMENT PROVISIONS
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Entry into force Signed and pendingratification
Under negotiation
50
5 2
169
13
78
Nos. having environment related provisions Total agreements
Rajan Ratna 14José-Antonio Monteiro (2016).Typology of environment-related provisions in
regional trade agreements, WTO Working Paper ERSD-2016-13
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ENVIRONMENT: WHAT IS IN THE ASIA-PACIFIC RTAS
• PREAMBLE
• BINDING COMMITMENTS:
➢MARKET ACCESS IN GOODS AND SERVICES
• DISPUTE RESOLUTION
• COOPERATION
• TECHNICAL ASSISTANCE
• TRANSFER OF TECHNOLOGY
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ASEAN
• DO YOU FIND EGS IN CEPT OR ATIGA TEXT?
• HAS THE GOODS TARIFF LIBERALISATION
PROGRAMME DEALT THE ENVIRONMENTAL
GOODS THROUGH A SEPARATE MODALITY?
• HOW DID ASEAN BRING THE EGS ON
AGENDA?
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ATIGA
▪ ATIGA TEXT DOES NOT HAVE A WORD ‘SUSTAINABLE’.
▪ THE WORD ‘ENVIRONMENT’ ONLY APPEARS ONCE AT ARTICLE 45:
WORK PROGRAMME ON TRADE FACILITATION AND ITS OBJECTIVES
“MEMBER STATES SHALL DEVELOP AND IMPLEMENT A COMPREHENSIVE
ASEAN TRADE FACILITATION WORK PROGRAMME, WHICH SETS OUT ALL
CONCRETE ACTIONS AND MEASURES WITH CLEAR TARGETS AND TIMELINES
OF IMPLEMENTATION NECESSARY FOR CREATING A CONSISTENT,
TRANSPARENT, AND PREDICTABLE ENVIRONMENT FOR INTERNATIONAL
TRADE TRANSACTIONS THAT INCREASES TRADING OPPORTUNITIES AND HELP
BUSINESSES, INCLUDING SMALL AND MEDIUM SIZED ENTERPRISES (SMES), TO
SAVE TIME AND REDUCE COSTS.”
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AEC & SAFTA
• ASEAN ECONOMIC COMMUNITY 2025 CONSOLIDATED
STRATEGIC ACTION PLAN ENDORSED BY THE AEM AND AEC
COUNCIL ON 6 FEBRUARY 2017 HAS MANY PROVISIONS
RELATING TO ‘ENVIRONMENT’ BUT NOTHING ON EGS.
• HOWEVER, THERE ARE MANY PROVISIONS WHICH CAN BE
INDIRECTLY CORRELATED TO EGS.
• SAFTA: THE WORD ‘ENVIRONMENT’ IS NOT THERE IN TEXT.
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COMMITMENTS - BEYOND COOPERATION
• SINGAPORE – US (2003)
• AUSTRALIA – US (2004)
• NEW ZEALAND – THAILAND (2005)
• REPUBLIC OF KOREA – US (2007)
• MALAYSIA – NEW ZEALAND (2009) – SEPARATE
AGREEMENT ON ENVIRONMENT
• REPUBLIC OF KOREA – EU (2010)
• TPP (2016) – CHAPTER 20
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COOPERATION
▪ JAPAN – MALAYSIA (2005)
▪ CHINA – NEW ZEALAND (2008)
▪ ASEAN – JAPAN (2008)
▪ ASEAN – ANZ (2009)
▪ MANY AGREEMENTS EITHER DO NOT MENTION
ANYTHING OR JUST REITERATE THE WTO
ARTICLE XX ON ENVIRONMENT.
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APEC• IN SYDNEY IN 2007 APEC LEADERS COMMITTED, THROUGH WIDE-RANGING
AND AMBITIOUS ACTIONS, AS SET OUT IN THE SYDNEY ACTION AGENDA, “TO
ENSURING THE ENERGY NEEDS OF THE ECONOMIES WHILST ADDRESSING THE
ISSUE OF ENVIRONMENTAL QUALITY AND CONTRIBUTING TO THE REDUCTION
OF GREENHOUSE GAS EMISSIONS.” LEADERS ALSO AFFIRMED THAT “AN OPEN
GLOBAL TRADE AND INVESTMENT SYSTEM IS CENTRAL TO OUR CLEAN
DEVELOPMENT OBJECTIVES AND MARKET OPENING IN THE WORLD TRADE
ORGANIZATION (WTO) WOULD ADVANCE OUR CLIMATE AND ENERGY
SECURITY GOALS.” AND RECOGNIZED THAT “JOINT RESEARCH, DEVELOPMENT,
DEPLOYMENT AND TRANSFER OF LOW AND ZERO EMISSION TECHNOLOGIES
WILL BE CRUCIAL IN OUR SHARED EFFORTS TO ADDRESS CLIMATE CHANGE.”
• THE APEC EGS PROGRAMME FRAMEWORK WAS ENDORSED BY MINISTERS AT
THE 2008 AMM. THE OBJECTIVES OF THE FRAMEWORK ARE TO SUPPORT THE
DEVELOPMENT OF THE EGS SECTOR IN APEC AND TO PROVIDE A COHERENT
SETTING FOR THE WORK UNDER WAY IN VARIOUS APEC BODIES. THE
FRAMEWORK HAS FOUR COMPONENTS: (A) RESEARCH AND DEVELOPMENT, (B)
SUPPLY, (C) TRADE AND (D) DEMAND.
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APEC (2)
• 13 NOVEMBER 2011, HONOLULU, USA (LEADER’S DECLARATION:ANNEX C):
• “IN 2012, ECONOMIES WILL WORK TO DEVELOP AN APEC LIST OF
ENVIRONMENTAL GOODS THAT DIRECTLY AND POSITIVELY CONTRIBUTE
TO OUR GREEN GROWTH AND SUSTAINABLE DEVELOPMENT OBJECTIVES,
ON WHICH WE ARE RESOLVED TO REDUCE BY THE END OF 2015 OUR
APPLIED TARIFF RATES TO 5% OR LESS, TAKING INTO ACCOUNT
ECONOMIES’ ECONOMIC CIRCUMSTANCES, WITHOUT PREJUDICE TO APEC
ECONOMIES’ POSITIONS IN THE WTO.
• ELIMINATE, CONSISTENT WITH OUR WTO OBLIGATIONS, EXISTING LOCAL
CONTENT REQUIREMENTS THAT DISTORT ENVIRONMENTAL GOODS AND
SERVICES TRADE IN THE REGION BY THE END OF 2012, AND REFRAIN
FROM ADOPTING NEW ONES, INCLUDING AS PART OF ANY FUTURE
DOMESTIC CLEAN ENERGY POLICY.”
• THE EG PRODUCT LIST WAS NEGOTIATED FROM MARCH TO
SEPTEMBER, 2012.
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APEC (3)
• ENVIRONMENTAL PRODUCTS WERE IDENTIFIED ON 54 ITEMS OF THE
HARMONIZED SYSTEM (HS). IT WAS AGREED TO BRING TARIFFS AT OR
BELOW 5 PERCENT, REDUCING TARIFFS AS NEEDED BY JANUARY 1,
2016.
• COUNTRIES WITH TARIFFS ALREADY AT OR BELOW 5% IN 2012:
AUSTRALIA, HONG KONG, JAPAN, NEW ZEALAND, AND SINGAPORE
• COUNTRIES TO REDUCE TARIFFS: BRUNEI, CANADA, CHILE, CHINA,
INDONESIA, KOREA, MALAYSIA, MEXICO, PAPUA NEW GUINEA, PERU,
THE PHILIPPINES, RUSSIA, THAILAND, THE UNITED STATES, AND
VIETNAM
• COUNTRIES REDUCED TARIFFS ON A TOTAL OF 375 PRODUCT LINES.
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SOME EVIDENCES
GOODS - LISTS
• ENVIRONMENTAL GOODS:
• OECD (132)
• WTO (480, 153, REQUEST LIST)
• APEC (54)
• CLIMATE FRIENDLY LIST
• WORLD BANK (43)
• CLIMATE SMART GOODS AND TECHNOLOGIES
• UNESCAP (64)
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TARIFFS• DOHA ROUND: REDUCTION AND ELIMINATION OF EGS
BEING DISCUSSED.
• APEC LIST OF 54 ITEMS: AUTONOMOUSLY DECIDED TO
BRING DUTIES TO 5% LEVEL.
• IN VARIOUS PTAS/FTAS COUNTRIES ARE
UNDERTAKING COMMITMENTS TO ELIMINATE DUTIES
ON SUBSTANTIALLY COVERED ITEMS INCLUDING
ENVIRONMENTAL GOODS.
• NTBS AND TRANSFER OF TECHNOLOGY IS AN ISSUE….
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ENVIRONMENTAL GOODS
• WTO – EGS NEGOTIATIONS
• PLURILATERAL LIBERALIZATION BEING DISCUSSED
• APEC LIST – 54 ITEMS
• ESCAP LIST – 64 ITEMS (CLIMATE SMART GOODS AND
TECHNOLOGIES)
• OECD LIST – 248 ITEMS
• NO CLEAR-CUT DEFINITION - DEBATED
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APEC AVERAGE MFN TARIFF
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0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
APEC 54 ESCAP 64 OECD 248
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
8.0
9.0
10.0
11.0
12.0
13.0
14.0
15.0
16.0
Singapore Vietnam Myanmar Malaysia Philippines Thailand Indonesia Lao PDR Brunei Cambodia
ASEAN Average MFN Tariff
APEC 54 ESCAP 64 OECD 248
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0
5
10
15
20
25
Afghanistan Sri Lanka India Nepal Bangladesh Pakistan Bhutan Maldives
SAARC Average MFN Tariff
APEC ESCAP OECD
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0
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
RCEP Average MFN Tariff
APEC ESCAP OECD
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INTRA INDUSTRY TRADE
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34
An intra-industry trade (IIT) index was calculated using the
Grubel-Lloyd method, with the index ranging between 0
and 1. A higher IIT indicated an existence of international
production network (IPN).
INTRA-INDUSTRY TRADE: APEC LIST
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0.52
0.69
0.91
1.00 1.00
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
SARRC ASEAN APTA APEC OECD
INTRA-INDUSTRY TRADE: ESCAP LIST
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0.72
0.89
0.97 0.97 0.98
0.0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1.0
SARRC ASEAN APTA OECD APEC
INTRA-INDUSTRY TRADE: OECD LIST
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0.67
0.77
0.97 0.98 0.99
0
0.1
0.2
0.3
0.4
0.5
0.6
0.7
0.8
0.9
1
APTA APEC ASEAN SARRC OECD
WTO: NOTIFIED SPS AND TBT MEASURES
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0
100
200
300
400
500
600
700
800
900
1000
Total SPS and TBT measures (APEC - 25 at 4 digit HS) Total SPS and TBT measures (ESCAP - 40 at 4 digit HS)
Total SPS and TBT measures (OECD - 106 at 4 digit HS)
Source: Compiled on the basis of Centre for WTO Studies, India database on SPS and TBT
RCEP: INTRA-INDUSTRY TRADE (AVERAGE OF 2013 TO 2016)
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RULES OF ORIGIN
• CUMULATION PROVISIONS FOSTER RVCS.
• OPEN AND FULL CUMULATION PROVISIONS WILL PROMOTE
THE RVCS AND GVCS.
• EXAMPLES:
• NAFTA – TEXTILES AND AUTOMOBILE FOR USA AND MEXICO
• INDIA – SRI LANKA FTA (WIR 2003)
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SERVICES
• THE FRAMEWORK EXISTS IN RTAS BUT EFFECTIVE MARKET
ACCESS IN SERVICES IS YET TO BE ACHIEVED IN ASEAN OR
SAARC.
• SOME BILATERAL OR ASEAN + 1 AGREEMENTS HAVE THE
COMMITMENTS, EVEN THOUGH THEY ARE WTO PLUS, AT BEST
THEY ARE AT THE EXISTING LEVEL OF AUTONOMOUS
LIBERALISATION.
• IN A FEW SECTORS THERE EXISTS RVC ESPECIALLY IN TOURISM
AND COMMERCIAL PRESENCE - FINANCIAL SECTOR (MODE 3).
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SERVICES, INVESTMENTS AND TOT
• NOT MUCH PROGRESS IN WTO NOR IN FTAS
• IMPORTANT SECTORS:
• PROFESSIONAL SERVICES (ARCHITECTURAL SERVICES,
URBAN PLANNING AND LANDSCAPE ARCHITECTURAL
SERVICES, OTHER)
• RESEARCH AND DEVELOPMENT SERVICES
• OTHER BUSINESS SERVICES (BUILDING-CLEANING
SERVICES)
• ENVIRONMENTAL SERVICES (SEWAGE, REFUGE
DISPOSAL, SANITATION AND SIMILAR SERVICES, OTHER)
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SERVICES AND INVESTMENT
• ENVIRONMENTAL SERVICES (SEWAGE, REFUGE DISPOSAL, SANITATION
AND SIMILAR SERVICES, OTHER)
• PROFESSIONAL SERVICES (ARCHITECTURAL SERVICES, URBAN PLANNING
AND LANDSCAPE ARCHITECTURAL SERVICES, OTHER)
• RESEARCH AND DEVELOPMENT SERVICES
• OTHER BUSINESS SERVICES (BUILDING-CLEANING SERVICES)
• ISSUES:
• IS IMPORT BAD ALWAYS?
• IF NO DOMESTIC PLAYER PRESENT, WHAT PREVENTS
LIBERALISATION?
• HOW TO PROMOTE INVESTMENT?
• HOW TO ATTRACT TECHNOLOGY AND INNOVATION?Rajan Ratna 43
WAY FORWARD
• RTAS CAN FACILITATE RVCS WHILE MULTILATERAL
LIBERALISATION CAN FACILITATE THE GVCS.
• AVOID DUPLICATION OF RTAS WITH SAME COUNTRIES
• APPROPRIATE RULES OF ORIGIN – CUMULATION
• IF ITEMS ARE LIBERALISED IN RTAS; SHOULD THERE BE
PROBLEMS IN LIBERALIZING UNDER WTO OR
UNILATERALLY?
• EXAMINE HOW BEST IT CAN BE USED AS A TOOL TO
ADDRESS THE NON-TARIFF MEASURES.
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REFERENCES• PALIT, AMITENDU (2014). REGIONAL SUPPLY CHAINS IN ASIA: EXAMINING INDIA’S PRESENCE AND
POSSIBILITIES IN RCEP, WORKING PAPER NO. CWS/WP/200/20, CENTRE FOR WTO STUDIES, NEW
DELHI.
• RATNA, RAJAN SUDESH (2016). PREFERENTIAL ROO: FACILITATORS OF REGIONAL AND GLOBAL
VALUE CHAINS. JOURNAL OF INTERNATIONAL TRADE, VOLUME 1 (2016), 29-46; CENTRE FOR WTO
STUDIES, NEW DELHI.
• UNITED NATIONS CONFERENCE ON TRADE AND DEVELOPMENT (2003). WORLD INVESTMENT
REPORT AVAILABLE AT HTTP://UNCTAD.ORG/EN/DOCS/WIR2003LIGHT_EN.PDF
• UNITED NATIONS, ECONOMIC AND SOCIAL COMMISSION FOR ASIA AND THE PACIFIC (2013).
ASIA-PACIFIC TRADE AND INVESTMENT REPORT 2013: TURNING THE TIDE: TOWARDS
INCLUSIVE TRADE AND INVESTMENT. SALES NO. E.14.II.F.2. AVAILABLE FROM
WWW.UNESCAP.ORG/TID/TI_REPORT2013/HOME.ASP
________APTIAD BRIEFING NOTE 8 (AUGUST 2016)
HTTP://WWW.UNESCAP.ORG/SITES/DEFAULT/FILES/APTIAD-BRIEF-AUGUST2016.PDF
_______ASIA-PACIFIC TRADE AND INVESTMENT PREFERENTIAL AGREEMENTS DATABASE – APTIAD:
WWW.UNESCAP.ORG/TID/UPTIAD
• WTO RTA DATABASE HTTPS://WWW.WTO.ORG/ENGLISH/TRATOP_E/REGION_E/REGION_E.HTM
Rajan Ratna 45
THANK YOU
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