agricultural and food exports

Figure 4.9 Estimated impacts of SPS and TBT provisions, by type, on Latin American and Caribbean agricultural and food exports

30

Increase in export value (%) 20

10

0

All SPS Essential SPS MR SPSHarmonization SPSTransparency SPS All TBT Essential TBT Transparency TBT

Peru–Chile, 2009 EFTA–Mexico, 2001

Source: World Bank calculations. Note: The figure shows the calculated magnitude of added export value from increasing the number of specific sanitary and phytosanitary (SPS) and technical barrier to trade (TBT) provisions to the levels in two different preferential trade agreements (PTAs): the 2009 Peru–Chile PTA (considered a deep PTA in SPS and TBT provisions) and the 2001 European Free Trade Agreement (EFTA)–Mexico PTA (considered a shallow PTA in SPS and TBT). The bars indicate increases in export value—of agricultural and food exports (in the case of SPS provisions) and of overall exports (in the case of TBT provisions)—after accounting for the depth of other provisions and for any tariff liberalization brought about by the PTA. “Essential” provisions are those that require specific liberalization and integration commitments and obligations; relate to procedures, transparency, and enforcement; or relate to achievement of SPS and TBT integration. Light-shaded bars indicate insignificant effects in the case of the Peru–Chile PTA. The figure does not include the impacts of mutual recognition (MR) and harmonization provisions for TBT because none of the Latin American and Caribbean PTAs includes those provisions.

smaller prevalence of PTAs that include those provisions relative to those that include SPS provisions.17

Harmonization provisions for TBT play no role in fostering Latin American and Caribbean countries’ exports. (Exports of the region’s countries do not respond to the presence of PTAs that include harmonization provisions for TBT.) This finding is also obtained outside the region (annex 4E, table 4E.2). For the region, the lack of effects is because there is only one Latin American and Caribbean PTA with such provisions—the 2011 EFTA–Peru PTA—possibly combined with a weak export response by Peru.

There is no evidence that transparency provisions for SPS and TBT benefit bilateral exports. Although the inclusion of transparency provisions for SPS and for TBT does increase exports (figure 4.9, fifth and eighth bars), the increase is not statistically significant. This finding is consistent with the slow growth in notifications to the WTO