From the Editor

Dear Readers,

Welcome to the second issue of The International Trade Journal (ITJ)’s thirty-seventh volume. The articles in this issue focus on regional integration and regional trade agreements. The first three articles look at different aspects of regional trade agreements, while the final two articles look at broader issues related to regional integration.

The first article, by Yash Parakh and Anwesha Aditya, looks at the economic, political, and cultural factors that affect whether countries form regional trade agreements (RTAs) with each other. In addition to economic factors such as market size and distance, they find that political and cultural factors are also important. On the political side, they find liberal democracies and countries that have a military alliance are more likely to enter into an RTA. Countries that have a common language are also more likely to enter an agreement. In contrast, colonial heritage negatively impacts how likely countries are to enter an RTA.

The second article, by Zouheir El-Sahli, looks at the effect of the Greater Arab Free Trade Agreement (GAFTA) on trade and economic welfare in the Middle East and North Africa. Using a gravity model, the author estimates that the agreement increased trade between countries in the region by about 40%. Although the relative increase was large relative to pre-GAFTA trade, this was from a low base. As a result, intra-GAFTA trade accounted for less than 10% of the countries’ total trade almost 20 years after GAFTA came into effect. By comparison, intra-EU and intra-NAFTA trade accounted for about 45 and 25% of total trade for countries in these regions.¹ Because of this, the agreement had only a very modest impact on wages or total trade for countries in the GAFTA region. The authors argue that this might be because GAFTA is a relatively shallow trade agreement.²

The third article, by Francisco Benita, looks at how regional trade agreements performed during and following the 2007 to 2009 financial crisis. The article looks at trade between member countries of five regional groupings: the Southern Common Market (Mercosur), the North American Free Trade Agreement (NAFTA), the Association of Southeast Asian Nations (ASEAN), the Arab Maghreb Union, and the Southern African Customs Union (SACU). It also looks at trade between members of these countries and nonmember countries. The author finds that the effects of the crisis were non-uniform across regions both during and following the financial crisis.

The fourth article, by Ebaidalla M. Ebaidalla and Mohammed Elhaj Mustafa Ali, looks at trade flows between 17 countries in the Middle East and North Africa. The authors find that actual trade between most country pairs has not reached its full potential. They attribute this to “behind the border” constraints. They also find that two of three sub-regional trade agreements have boosted trade in the region (the Arab Maghreb Union and the Agadir Agreement), while a third (the Gulf Cooperation Council) has not.³

The final article, by Yvonne Umulisa, looks at whether trade affects African countries’ business cycles. Using panel data from between 2000 and 2016, the author finds that as countries become more integrated in terms of trade, their business cycles become more closely synchronized. She notes, in particular, that the business cycles of countries in the East African Community have become more closely synchronized over this period.

As usual, we would like to thank the people without whom the ITJ would not succeed. These include the authors who contribute their articles, the anonymous referees who give detailed and timely comments, the team at the International Trade Institute at Texas A&M International University (TAMIU) who process submissions quickly and efficiently, our Editorial Board who guide the journal, and our publisher, Taylor and Francis, who ensures the ITJ keeps its high standards. We would also like to welcome our new editorial assistant, Jasmine Speer, to the ITJ team at TAMIU.

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

¹ Several recent articles in the ITJ have looked at NAFTA in greater detail (Hernandez-Trillo 2018; Sánchez, Calderón, and León 2018).

² Wang (2016) finds that deeper agreements have a greater impact on trade, especially in the long run.

³ Another recent article in the ITJ looked at how the Gulf Cooperation Council affected agricultural trade in the region (Kaitibie and Rakotoarisoa 2017).