Preferential Trade Agreements and Trade Liberalization Efforts in the OIC Member States
With Special Emphasis on the TPS-OIC
114
One of the key features of the agreement making it attractive for members that also trade with
the EU is that it provides for cumulation of origin between the Barcelona Process participants
with FTAs with the EU, EFTA and Western Balkans. A system of Pan-Euro- Mediterranean
cumulation of origin is currently being created26. It is based on a network of preferential trade
agreements, with identical origin protocols. It applies diagonal cumulation which in the
context of the Pan-Euro-Med system, implies that products which have obtained originating
status in one of the 42 participating countries may be added to products originating in any
other one of the 42 without losing their originating status within the Pan-Euro-Med area.
Table 19: Agadir Country Tariffs
Reporter Partner 2000 2005 2010
Jordan World (MFN) 22.09 13.57
World (applied tariff) 22.09 11.29
Egypt World (MFN) 19.92 (2002) 19.58 16.82 (2009)
World (applied tariff) 19.91 (2002) 19.44 15.00 (2009)
Morocco World (MFN) 31.69 26.19
World (applied tariff) 30.5 18.29
Tunisia World (MFN) 26.91
World (applied tariff) 13.59
Source: WITS (TRAINS database - aggregated from 6digit data)
Note: no reliable data on average applied tariffs to the Agadir partner countries are available for this
period;
In parallel, full cumulation is currently operated by the European Economic Area (EEA
comprises the Community, Iceland, Liechtenstein and Norway) and between the EU and
Algeria, Morocco and Tunisia. These countries apply full cumulation between themselves and
diagonal cumulation with the other pan-Euro-Med countries. This implies that processing
activities carried out in any of these countries can be counted as qualifying content, regardless
of whether the processing is sufficient to confer originating status on the materials themselves.
Hence, full cumulation makes it easier to fragment production process to a greater extent pro-
cesses among the participating countries and it stimulates deepening of economic integration
(Brenton, 2011). At the same time it is worth noting that the model of the rules of origin in the
FTAs with the EU and Agadir agreement are different from the ones applied e.g. in the
agreements with the US. This potentially adds complexity for producers and traders dealing
with trade with members of the Pan-Euro-Med area and other countries, such as the US.
26For discussion and links to legal documents see
[accessed 2 May 2014].