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Termites in the Trading System: How Preferential Agreements Undermine Free Trade.

Article Excerpt
TERMITES IN THE TRADING SYSTEM." HOW PREFERENTIAL AGREEMENTS UNDERMINE FREE TRADE BY JAGDISH BHAGWATI (NEW YORK, US: OXFORD UNIVERSITY PRESS, 2008) 139 PAGES. PRICE AU$45 (HARDBACK) ISBN 9780195331653.

This is a small book, but it is no less effective for being brief. It takes no intellectual prisoners and gives no quarter in argument. It is in every sense what in French is described as a livre de combat. Over a long and distinguished career, Professor Jagdish Bhagwati has written many weighty tomes and countless articles in learned journals in defence of his views on the advantages of the liberal trading order. (1) These works have been read with the respect they deserve by a learned and expert audience. But clearly Professor Bhagwati has decided that the time has come to reach out to a wider audience if the rot in the multilateral trading system is to be stopped.

Bhagwati is deeply concerned that the rush to conclude what are euphemistically known in the World Trade Organization parlance as 'regional trade agreements', but which he prefers to designate by the more accurate term of 'preferential trade agreements', is having a profoundly corrosive effect upon the maintenance of the integrity of the principles and practice of the multilateral trading system. He is unequivocal in his judgement that preferential trade agreements, which today number over 350, 'have now turned into a pandemic and a pox on the world trading system'. (2) In his arguments against preferential trade agreements, no scorn is too withering, no refutation too blunt. Only...