Articles

• Hoekman, Bernard M.
• Mavroidis, Petros C.

Abstract

Plurilateral agreements in the context of the World Trade Organization (WTO) allow sub-sets of countries to agree to commitments in specific policy areas that only apply to signatories and thus allow for ‘variable geometry’ in the WTO. Plurilateral agreements share a number of features with preferential trade agreements (PTAs), which are increasingly used by governments to liberalize trade in goods and services. This article discusses the current institutional framework that governs these two alternatives and distinguishes them from the general, non-discriminatory agreements that are negotiated among – and apply to – all WTO members. Current WTO rules make it much more difficult to pursue the plurilateral route than to negotiate a PTA. We review the arguments for and against making it easier for ‘issue-specific’ clubs to form in the WTO and discuss how concerns raised by some WTO members regarding the potential negative impact of plurilateral agreements on the multilateral trading system might be addressed. We take the view that action to facilitate the negotiation of plurilateral agreements in the WTO should be considered and that the potential downsides for the multilateral trading system can be managed.