Trade Regional Integration And The Development Of GATT/WTO

Discussing the relation between Trade regional integration and GATT/WTO has been the top topic in the international economical law. The rapid growth of regional trading relationships in Europe(such as EU), Asia(APEC), and North America (NAFTA) has raised policy concerns about their trade impact on the third countries and on the global trading system. Yet trade regionalism has not always yielded uniform beneficial effects. The inherent exclusiveness of RTAs has always held the potential for conflict with the interests of non- members.The post-war architecture of the international trade system, symbolized by GATT 1947, set forth non-preferential and non-discriminatory principles based on globalism or multilateralism. Regionalism was permitted only to the extent that it complied with the legal rules, which were a compromise to allow for RTAs, as the foremost exception to the MFN principle, but to subject them to some important disciplines. These disciplines are designed to maintain balance between trade creation and trade diversion while preventing misuse of the exceptional system. However, GATT Article XXIV has proven inadequate in several respects. Tensions have often arisen vis-à-vis the so-called multilateralism or globalism represented by the GATT/WTO system. Although the old GATT 1947 Article XXIV attempted to coordinate these two contrasting philosophies on trade regionalism, its success was limited by the weak mandate of the working party as well as by the lack of an effective dispute settlement mechanism. As a result, RTAs proliferated in the absence of legal discipline. It is true that some languages of GATT/WTO rules has been loose. As a result, de facto ignorance of GATT discipline and a phenomenon of spread of 'partial' RTAs have developed, bringing to mind the image of 'Bhagwati's spaghetti bowl.It was not until after conclusion of the Uruguay Round that some legal discipline was established to prevent misuse or abuse of Article XXIV. Article XXIV Understanding can be a legislative example and the Turkish QRs case as a jurisprudential example. Nonetheless, these recent legal breakthroughs are limited in breadth as well as depth, Since GATT/WTO rules sheds little light on the new development: trade in services of RTAs. More importantly,since most RTAs have already passed the "formation" stage and are operating as real entities, GATT Article XXIV's narrow focus on the formation of RTAs naturally appears obsolete. Completing its multilateral venture to the WTO, China is accelerating its move toward the regional trade integration, especially with its neighbor economies through the exchange of mid-to-high level official visits and active participation in the regional economic and political dialogues including ASEAN plus Three, APEC and ASEAN regional forum. China and ASEAN have agreed to establish the FTA within the next 10 years. This year, CEPA has officially entered into effect. As PRC and China Taiwan entering WTO, the complexion of "one country, four separate customs territories" has appeared under WTO, then we shall come up with some suggestions and bear in mind, that is how to establish arrangements conforming with WTO rules, like Great China Free Trade Zone arrangements(comprising China, Taiwan, Hong Kong, and Macau,); utilize the related WTO Exception provisions to obtain more preferences and establish china's attitude towards perfection of GATT Article 24 and so on.