ABSTRACT
Transregional trade agreements have proliferated in recent years, and they are occupying a larger space between multilateral and regional trade agreements. Before discussing this issue, it is necessary to define several terms. Multilateral trade negotiations (MTNs) liberalize trade at the global level. The General Agreement on Tariffs and Trade (GATT) and its successor, the World Trade Organization (WTO), are multilateral trade organizations; all countries that fulfil the membership requirements can join the WTO. By contrast, preferential trade agreements (PTAs) are discriminatory because they limit membership. PTAs exist at various stages of integration. They might simply lower tariffs, virtually abolish tariffs (a free trade agreement, FTA), or abolish tariffs among members and impose a common external tariff on outside countries (a customs union, CU). The integration of the European Union (EU) goes beyond the CU stage; it also involves the free movement of labour and capital (a common market), the harmonization of many economic policies (an economic union), and 19 of the 28 EU members use the euro as a common currency (a monetary union).
