The Impact Of PTAs’ Depth On The Participation In GVCs Of The Developing Countries

The last decade was characterized by both the rising importance of global value chains(GVCs)in international trade and the parallel proliferation of preferential trade agreements(PTAs).For developing countries,the implications of deep PTAs in the context of GVCs are of particular interest.On the one hand,PTAs eliminate trade barriers and serve as a commitment device signaling policy transparency and predictability-both of which are associated with increased foreign direct investment and trading activity.On the other hand,the binding commitments in PTAs are often regarded as restricting policy-makers in their choice of supportive policies for development.If PTAs are indeed seen as a necessary way of governing global value chains,assessment of their impact on participation and value capture is essential.Making use of newly available data on decomposed trade flows and on the content of PTAs,which covered the information on the legal enforceability of seven core provisions,this paper develops the depth "core provision" index and the depth of the signal provision and investigates the link between global value chains and preferential trade agreements.The results show that:The enhancement of PTA depth can significantly promote the export volumes of the developing countries,especially between the developing-developed member pairs;The enhancement of PTA depth in the elimination of tariffs,investment and trade-related investment measures can promote the export volumes of the two members.The enhancement of PTA depth in services trade and public procurement has inhibitory effect on the two members.The enhancement of PTA depth in intellectual property protection and competition policy has shown heterogeneous and asymmetric influences on different country pairs.Comparing the estimated coefficients of "WTO+" clauses and"WTO-X" clauses,the results show that the coefficient of the former is greater than that of the latter,indicating that the "WTO+" clauses have a greater impact on developing countries’ participation in GVCs.Against the background of the preceding chapters,the following policy recommendations with regard to PTAs are put forward:(1)Conduct a cost-benefit analysis of PTA membership.(2)Gear PTAs towards developing country needs.(3)Pursue negotiations at the multilateral level.(4)Give priority to PTA partners of the close economic and trade ties.