Preferential Trade Agreements and Trade Liberalization Efforts in the OIC Member States
With Special Emphasis on the TPS-OIC
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for total exports, and from 20.9% to 23.7% for total non-oil and gas exports. The second
exercise we undertake is once again to take all those countries that reported in both 1995 and
2010 and use these to define a sub-group of OIC countries which is then used to hold both the
reporter and partner country group consistency constant. So for these 21 countries we
calculate the average share of intra "OIC" trade (where the OIC is defined as the "OIC 1995"
and represents the 21 countries described earlier so as to ensure that the country composition
remains constant). This shows that the intra "OIC 1995" share rises from 3.3% to 6.1% with
regard to imports; and from 3.5% to 6.5% with regard to exports15. If we just consider total
non-oil trade than the corresponding figures for imports show a rise from 2.9% to 5.1%; and
for exports a rise from 3.8% to 7.4%.23 This suggests a growing importance of intra-OIC trade
(at least with regard to trade between these 21 countries), and shows a similar pattern for
imports and exports, and where both total trade, and total non-oil trade is considered.
If the same exercise is carried out, but this time on the countries which reported in 2000 and
2010, we then obtain the share in the intra "OIC 2000" imports was from 7.5% to 12.1% with
regard to total imports and with regard to total non-oil imports it was 5.9% to 10.4%; the
corresponding figures with regard to exports are 5.7% to 8.5% for total exports, and 7.2% to
12.2% for total non-oil exports.
While the preceding exercises might appear complicated, they are important and revealing.
The evidence shows that there is growing intra-regional trade between the OIC countries both
on the side of exports and imports. The increasing trend is more pronounced when one looks
at non-oil trade. On the face of it this would appear to suggest an increased likelihood of a
positive impact from further and deeper integration between the member states.
Given the diversity of the OIC group it is not surprising that countries differ substantially in
terms of the role of intra-OIC trade. Figures 10 and 11 below show countries with the highest
and lowest shares of exports and imports with OIC partners in 2010.
A low share of intra-OIC trade can in some cases be explained by distance from other OIC
countries. For instance, Guyana and Suriname are the only OIC countries in South
America. In other cases it can be explained by high economic integration with non-OIC
partners for a combination of geographical, economic and political reasons. For instance
Albania trades heavily with the EU countries, while Kazakhstan imports mainly from
Russia and China. In the case of Nigeria the explanation is likely related to its much higher
economic size and higher level of development than among its African OIC neighbours as
well as its large oil exports so that Nigerian main trade partners are the US, EU, India,
China and Brazil rather than OIC countries. In some other countries, non-diversified
export structures can also be among explanatory factors for low exports to OIC when
15 Note here we have calculated the share for each of the 21 countries, and then computed the simple average;
hence these shares are not directly comparable to the intra-OIC shares in the preceding paragraph which are based
on total intra-OIC trade flows, and therefore effectively give the weighted share.