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Title page 1

Contents 3

ABSTRACT 2

1. INTRODUCTION 4

2. LITERATURE REVIEW 5

3. MFN PRINCIPLE AND OTHER DUTY ARRANGEMENTS 6

Article I of the GATT 1994 6

Regional Trade Agreements and Preferential Trade Arrangements 7

Other MFN provisions, exceptions, and derogations 9

4. DATA 10

5. METHODOLOGY 11

6. RESULTS 15

Global overview 15

By economy 17

By region 18

By MTN category 19

By income groups 20

MFN shares on imports vs. MFN shares on exports 21

7. CONCLUDING REMARKS 23

8. REFERENCES 24

9. ANNEX 26

Tables 16

Table 1. Global trade shares 16

Table 2. Shares by geographical regions 19

Figures 14

Figure 1. Range of preference utilization across MTN categories 14

Figure 2. Preferential and MFN trade by tariff bands 17

Figure 3. Imports by MFN and preferential tariff regimes, top 20 importers 18

Figure 4. Import by MFN and preferential trade regimes by MTN category 20

Figure 5. Trade by duty schemes and "income group" 21

Figure 6. Difference in MFN trade shares between Imports and Exports, top 20 importers 22

Annex Tables 26

Annex Table 1. Data availability of detailed imports by duty schemes 26

Annex Table 2. Preference utilization by MTN category, 2017-2022 26

Annex Table 3. Global Trade Shares 27

Annex Table 4. Regions and economies, 2022 28

초록보기

The Most-Favoured-Nation (MFN) principle has historically been instrumental in promoting stability and equitable trade conditions. In recent decades, there has been a rise in bilateral and regional trade agreements, which deviate from the MFN principle by providing more favourable tariff treatment to specific partners. At the same time, WTO Members can, under certain circumstances, raise trade barriers against imports for different reasons, including to counter unfair trade practices.

Using a novel and comprehensive dataset based on customs data submitted by WTO Members to the WTO's Integrated Database and complemented by other sources, this paper provides an in-depth analysis of global merchandise trade flows under both MFN and preferential tariffs. The methodology takes into account trade remedies, including anti-dumping and countervailing duties, additional duties in the US and China, and the utilization of trade preferences by incorporating preferential tariffs and bilateral trade flows for 184 economies.

The research highlights the nuanced effects of MFN trade across different economies, regions, product and income groups, and compares MFN treatment on imports and exports. The paper concludes that more than 80% of global trade in goods is conducted on MFN terms and underscores the continued importance of the multilateral framework for the global trading system.

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