Book Description
Discriminatory trade liberalization in agricultural trade is becoming a new trend in the second wave of regional trade agreements. Interdependence of agricultural development and international trade is a key stimulus for the recent developments of trade liberalization in agricultural sector. In developing countries, agricultural sector is still the most dominant sector and contributes a larger portion to national income and employment. Majority of the people of these countries have employed in farming and agricultural related works. As a result, the standard of living of these people greatly depends on the development of agricultural sector. Poverty and hunger which are the cause and consequence of food insecurity is linked with agricultural sector of those economies. The main objective of this study is to capture trade benefits of ASEAN free trade agreement (AFTA) on agrifood trade. The study employs gravity model to estimate impacts of AFTA on agrifood trade and investigate trade effect of AFTA on eight agrifood commodities individually and on the whole. Findings of the study support the statement that joint membership has significantly enhanced agrifood trade among member countries of AFTA. Also, trade creation in agrifood trade is found with the formation of AFTA. Further, study concludes that joint membership has created favorable environment to increase trade among members in cereals, drinks, edible foods, oilseeds, red meat and sugar trade while making negative impacts on fruits and vegetable trade. Trade creation is found in cereal, drinks, edible foods, fruits, vegetables and sugar with AFTA. Oil seeds and red meat found to be trade diverted by AFTA.
