Preferential Trade Agreement
PREFERENTIAL TRADE AGREEMENT (PTA)
Some time back a proposal was made by Sri Lanka to have a
Preferential Trade Agreement for the region. It was envisaged
that the implementation of such an arrangement would assist in
bringing about immense benefits to Member States by way of removing
trade/tariff barriers, thereby expanding the total volume of the
value of trade flows among Member States.
Essentially, the proposed implementation of the PTA is to
promote Economic Development through a continuous process of Trade
Expansion among Member States. Such an arrangement is aimed
at expanding Short and Medium Term Trade and Investment
Opportunities within the region, ensuring Preferential Market
Access with the effective relaxation of tariffs and the dismantling
of Non Tariff Barriers (NTBs).
A Concept Paper on the feasibility of establishing a PTA and
Draft Framework Agreement on the PTA were prepared and a Core Group
comprising the following Member States namely, I.R. of Iran, Kenya,
Mauritius, Sultanate of Oman, Sri Lanka, Tanzania and Yemen was
formed, to look into the study.
In order to ensure success of the PTA, within the framework of
an ever changing global economic environment and in particular the
WTO agreement, it was deemed essential to have a considerable
margin of tariff concessions to cover a wide array of products that
Member States may agree upon. Further, it would be concluded
that the larger membership of the agreement would enhance
complementary treatments in trade and economic co-operation among
the Member States.
While some Member States may not be in a position to express
support at this stage, those interested Member States were
encouraged to continue negotiations to find "Common Ground" for an
agreement that would promote trade amongst themselves.