Securing the Peace Dividend in the Middle East: Amending GATT Article XXIV to Allow Sectoral Preferences in Free Trade Areas

How should Middle East nations structure their future economic relationships to secure their peaceful reconciliation while simultaneously fulfilling their WTO obligations? This note suggests two solutions to this quandary. First, the newly emerging bloc of peace-declaring nations in the Middle East should consider establishing a regional free trade area. However, instead of reducing the tariffs of “substantially all” of the region’s products as would normally be required by Article XXIV of the General Agreement on Tariffs and Trade (GATT) 9-the authoritative provision regulating free trade areas-this note argues that a Middle East free trade area should reduce trade barriers only for certain economic sectors, such as textiles and chemicals. Such a scheme will be termed a “sectoral trade area,” or “STA.” Second, and in furtherance of the STA scheme, this note argues that Article XXIV does not adequately facilitate peaceful political and economic relations between formerly belligerent and lesser-developed nations that have low levels of economic interaction. Accordingly, Article XXIV should be amended to allow STAs as described above under narrowly defined and closely monitored situations.