Regional Trade Agreements (RTAs) are treaties between two or more countries that aim to create preferential trade arrangements within a specific region. These agreements can concern several elements of trade, typically trade in goods and services is involved. Countries can agree on reciprocally eliminating tariffs and trade barriers. They can also include broader aspects of economic integration.
Types of Regional Trade Agreements include:
- Free Trade Agreements (FTAs) where trade barriers, including tariffs, are eliminated,
- Preferential Trade Arrangements (PTAs) where trade barriers are reduced albeit not eliminated. They also include unilateral trade privileges such as General System of Preferences schemes granted to developing States by developed States,
- Customs Union where trade barriers are removed and common external trade barriers are adopted,
- Common Market where countries remove internal trade barriers, adopt common external policies and allow free movement of goods among the members,
- Economic Unions, e.g., European Union