Preferential Trade Agreements and Trade Liberalization Efforts in the OIC Member States
With Special Emphasis on the TPS-OIC
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should notify the TNC Secretariat of their specific annual installments of reduction along with the list
of products, and the MFN applied rates applicable on 1 October 2003. Moreover, the Member States
who have ratified the TPS-OIC Rules of Origin should complete the necessary internal legislative and
administrative measures, such as printing TPS-OIC Certificate of Origin and providing specimen
impressions of stamps to the TNC Secretariat.
As of September 2014, 12 Member Countries have signed and ratified all the three agreements and
sent their list of concessions to the TNC Secretariat. These are: Bahrain, Bangladesh, Jordan, Malaysia,
Morocco Oman, Pakistan, Qatar, Syria (OIC Membership suspended in 2012), Saudi Arabia, Turkey,
and the United Arab Emirates.
5 of these countries are Gulf Cooperation Council (GCC) members (United Arab Emirates, Bahrain,
Qatar, Oman and Saudi Arabia). There is a customs union among the GCC Member States which
obligates its members to fulfil the dual requirement of signing and ratifying the three TPS-OIC
agreements and submitting the concession lists jointly. The GCC Secretariat has submitted the list of
concessions on behalf of its six members. Nonetheless, Kuwait has not completed the ratification of
the agreements. For the System to be effectual in the GCC countries, the ratification of the PRETAS
and the Rules of Origin by Kuwait needs to be completed. Table 29 details the current status of the
signature and ratification of the agreements by the Member States.
An important element in the Framework Agreement (Article 6) is the most favoured nation (MFN)
clause, which establishes that benefits shall be extended to all participating states. This means that
the same preferences should, in principle, be granted to all current and future members. With regard
to the MFN clause exceptions are allowed in order to protect "special interests", but on the condition
that these do not have a detrimental impact on other participating states. The Framework Agreement
established also the potential scope of the agreement, that in principle, all goods will be considered
for liberalisation, including agricultural goods, while services are not part of the agreement.
Nevertheless, the de facto scope of the agreement, as discussed below, is somewhat lower. The
Framework Agreement also establishes that in principle preferences should be created with regard
to both tariffs and non-tariff measures. The fact that services are not part of the agreement, means
that it is only GATT service provisions that are of relevance for the member states.
The PRETAS established more specific rules with respect to the preference regime. In particular, it
established that the base rate of the tariffs for any reductions would be the MFN rate as applied in
2003. Table 30 below presents the evolution of the average MFN tariff in each of the current
signatories of the TPS-OIC from 1995. Unfortunately, data on the tariffs applied for all countries was
not available for 2003 and the closest year with data for all countries is 2005. This table extends the
analysis presented in Figure 15 in section 5.2.4.
As can be seen from the table, notionally the concessions to be given are potentially important for
some members. In general and without considering the negative list or exclusions, Bangladesh,
Jordan and Pakistan (measured by the height of the average tariffs) may need to make important