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	Table of Contents
p. 65 of 81 BACK | NEXT I. Developing Asia and the World II. Economic Trends and Prospects in Developing Asia III. Preferential Trade Agreements in Asia and the Pacific Overview Trends in Trade and the Expansion of PTAs: Trends in World and Asian Trade Flows Diversity in of PTAs Origins of PTAs Institutional Characteristics of PTAs PTAs as Mechanisms for Regional Cooperation Asia and Pacific PTAs and the World Trade Organization Income Characteristics of PTAs Overlapping Memberships in PTAs and Multilateral Trading Arrangements The Economic and Broader Effects of PTAS: Theoretical Arguments Effects of PTAs on Trade in Asia and the Pacific: Some Evidence Conclusions References

Asian Development Outlook 2002 : III. Preferential Trade Agreements in Asia and the Pacific : Diversity in of PTAs

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Income Characteristics of PTAs

PTAs involving DMCs vary greatly with respect to level of income and economic development. Some have members whose level of development is at a fairly uniform level with per capita incomes in a narrow range. Others have a wide dispersion in standards of living. ECO and SAPTA have the lowest average per capita incomes; CER and SAPTA have the smallest variations in per capita incomes (among PTAs involving DMCs). Other PTAs in the region have higher average per capita incomes and there is substantial variation in income levels among members. AFTA and SPARTECA have the highest variation in GDP across the member countries. AFTA brings high-tech industrial Singapore together with primarily rural Cambodia, Myanmar, and Viet Nam. SPARTECA’s high coefficient of variation is due to the dispersion between the Pacific DMCs on the one hand, and Australia and New Zealand on the other (Table 3.6).

The European PTAs—the European Free Trade Association (EFTA) and the EU—are two of the richest of the PTAs with per capita incomes of about $27,500 and about $20,800, respectively. They are currently two of the more homogenous agreements, with coefficients of variation in per capita income of 0.2 and 0.3. This situation will likely change as the EU expands eastward.

Among PTAs in the Americas, the Andean Pact and Mercosur are in the middle to lower ranges of worldwide average per capita incomes, while the coefficient of variation in per capita income is slightly below average. The North American Free Trade Agreement (NAFTA) stands out as the only PTA outside of Asia between major industrial countries and a less developed neighbor.

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