As has already been said, these are agreements in which one country unilaterally offers preferential rights to another country or group of countries. The country offering the preference shall lift or reduce import duties on imports from those countries, without in return benefiting from the same preferences. These agreements generally focus only on trade in goods. In principle, we can distinguish between unilateral trade agreements and systems (proposed from one side to the other) and reciprocal trade agreements and systems (negotiated and agreed between the two parties). Each free trade agreement is negotiated and agreed separately by the participating countries. A country can be a member of several free trade agreements. Preferential rules of origin are applied in order to prevent third countries from benefiting from preferential duties under a free trade agreement, without offering reciprocal benefits. A preferential trade area (including preferential trade agreements, PTAs) is a trading bloc that gives preferential access to certain products from participating countries. This requires the reduction of customs duties, but not their total elimination. A PTA can be established by a trade pact. This is the first step in economic integration.
The boundary between a PTA and a free trade area (PTA) can blur, with almost all PTAs having the main objective of becoming a free trade agreement under the General Agreement on Tariffs and Trade. Several hundred bilateral SAAs have been signed since the beginning of the twentieth century. The Trend[6] project of the Canada Research Chair in International Political Economy lists approximately 700 trade agreements, the vast majority of which are bilateral. [7] Second, the term “preferential trade agreement” may be used to refer to agreements with a partial scope. These agreements provide preferential market access by reducing import duties on a limited quantity of goods. These tariff preferences have given rise to numerous derogations from the principle of normal trade relations, namely that members of the World Trade Organization (WTO) should apply the same duty to imports from other WTO members. [1] The Generalised System of Preferences (GSP) is an important example: a unilateral preferential programme offered by many industrialised countries (e.g. B the United States, Switzerland, Japan and the EU) to a number of developing and least developed countries. Preferential rules of origin shall be applied in order to prevent third countries from benefiting from the preferential rights offered to the selected countries. The majority of mutual agreements covered by the instrument are free trade agreements.
Free trade agreements (FTAs) remove barriers to trade between members and provide preferential market access on a mutual basis. In addition to trade in goods, free trade agreements generally cover trade in services and investment rules and remove tariff and non-tariff barriers. They may also include a number of provisions relating to customs cooperation and trade facilitation, as well as harmonising standards and promoting regulatory cooperation in different areas. . . .