Reviewing Agricultural Trade Policies
To Promote Intra-OIC Agricultural Trade
10
CEPII BACI database has been reconciling UN Comtrade data by mirroring figures, correcting
discrepancies, and all of the OIC countries are covered as well (CEPII, 2010).
International trade statistics have been reported by countries with several product
classifications. Product classification nomenclatures are defined as agreed systems for
classifying goods according to defined criteria. Most common international nomenclatures are
listed as “Harmonized Commodity Description and Coding System (HS)” and “Standard
International Trade Classification (SITC)”. While HS classification is originally developed by the
World Customs Organization for organizing customs duties and RTA conditions among
countries, SITC is developed by the United Nations for statistical analysis of trade data with
easier classifications for sectors. In this study, SITC Rev. 4 classification system has been
employed as the main unit of analyses on product classification.
There are two restrictive consequences of using the CEPII BACI database: (i) lagging behind time
and (ii) having HS as the only available classification. CEPII BACI database is based on an
analytical process and it takes nearly one calendar year to be announced. For instance, currently,
2016 data is available as the last available year in the CEPII BACI database. Nonetheless,
considering that there are many OIC member countries that have not yet disclosed the data for
2016 through UN Comtrade, this disadvantage of the CEPII BACI database is not considered to
be “too restrictive” for the envisaged study. In the case of product classification system,
concordance from HS 2007 version to SITC Rev. 4 is carried out through the concordance table
shared by UN Statistics Division (2008). While concordance is carried out from relation 6 digits
HS classification to 4 and 5 digit SITC Rev. 4 classification, agricultural products are aggregated
into product groups shared in Annex B.
To sum up, reconciled UN Comtrade data obtained from CEPII BACI database is used as the
primary data source for trade flows analyses in this study. Agricultural products are converted
from HS 2007 version to SITC Rev. 4 covering the period from 2008 and to 2016. Products are
aggregated in line with product list shared in Annex B. Considering all product, country, and year
pairs, the database covers 9 years, 240 countries, 20 product groups and more than 1 million
observations.
1.1.2. Regional Trade Agreements
Within World Trade Organization (WTO) system, if a WTO member grants a certain country a
special favor, such as a lowering tariff rate (custom duty) for one of its products, the same
country has to do follow it for all otherWTO partners, as well. As this principle is known as Most-
Favoured-Nation (MFN) treatment, bilateral and plurilateral trade agreements are allowed
exceptions in which countries may provide lower tariff rates than their MFN rates to their
trading partners. In particular, reciprocal preferential trade agreements (such as free trade
agreements and customs unions) are recognized as instruments to facilitate freer trade flow
among its signatories by the WTO. Accordingly, trade agreements are the exceptions of equal
treatment, and prominent tools of trade policies implemented by countries. Currently, the
number of regional trade agreements (RTAs) in force is 463 as of October 26, 2018 (WTO, RTA-
IS).
From a time-series perspective, NSF-Kellogg Institute Database on Economic Integration
Agreements and Mario Larch's Regional Trade Agreements Database provide a wide range of
time span covering agreements notified to the WTO, but both of these databases are out of date
while the first one ends in 2012 and the latter one ends in 2015. ITC’s Market Access Map
(Macmap) also covers RTA’s in force, but it is not designed for bulk downloads and has some