Since 1950, international trade volumes have multiplied 400 times. In this process, and especially since the last decade of the 20th century, trade agreements have proliferated significantly. However, until this dashboard was created, it was extremely difficult to access systematized information on the number of agreements by country and the volume of trade covered by them.
At Infodash we used information from NSF-Kellogg Institute Data Base on Economic Integration Agreements, UN-COMTRADE, OECD-WTO, and Hofmann et al. (2019) to create a country-level database detailing, for each possible bilateral relationship, the existence of a trade agreement, the type of agreement, and the volume of trade in goods and services for the period 2005-2017.
The trade agreement variable can have five different values:
- Non Agreement: in this case the countries do not have any type of trade agreement
- Non-Reciprocal Preferential Agreement (NRPA): the exporter gains access to some type of tariff preference on certain products; the most emblematic case occurs under the Generalized System of Preferences (GSP), where countries classified as "least developed countries" or "developing countries" can access tariff benefits when exporting to "developed countries"
- Preferential Trade Arrangements (PFTA): there are some tariff preferences granted between member countries of the agreement, but they are limited to a certain range of products
- Free Trade Agreements (FTA): there is a trade agreement between the partners where tariff rates have been reduced across a broad range, generally covering more than 90% of products
- Customs Unions (CU): the countries maintain a customs union, such as Argentina, Brazil, Uruguay, and Paraguay in MERCOSUR. This also includes economic regions with greater economic integration, such as the European Union (EU)
On the other hand, it is important to highlight two limitations of the dashboard. First, the database may not reflect all existing agreements worldwide, as it is primarily sourced from notifications made by countries to the World Trade Organization (WTO). However, those agreements could only slightly modify the main conclusions, since all agreements representing more than 1% of world trade are reflected. Second, there is no information on which products have been excluded from a particular agreement, so the dashboard does not reflect trade conducted under trade agreements, but rather estimates what percentage of world trade is carried out by pairs of countries with some type of trade agreement.
