The Role of Regional Institutions in Times of Trade Restrictions

This chapter examines the legal and institutional challenges to regional trade integration in times of trade restrictions. It examines the role of regional organizations in balancing competing trade and political interests, and in particular, it examines the importance of regional trade institutions and mechanisms in advancing regional integration, identifying the key challenges that may hinder their effectiveness in promoting regional trade in times of blockade. The aim of regional integration is to reduce conflicts, divisions, and barriers to the free flow of goods and services between countries. Over the last several decades, through the mechanism of regional trade institutions (such as the GCC, League of Arab States, OIC, African Continental Free Trade Area (AfCFTA)), countries have been able to advance regional integration and trade liberalization. However, as can be learned from the Qatar blockade, blockades pose significant risks to regional integration. The development of alliances and blocs in times of blockade may lead to countries picking sides based on their trade preferences and priorities, which may hinder regional integration. Furthermore, without neutral and effective dispute resolution mechanisms to promptly resolve disputes amongst member states, blockades may hinder the inclusive development of a regional market. This chapter examines the regional integration risks in times of trade restrictions. It discusses the drivers of such regional integration risks, and the role of effective and inclusive mechanisms in managing such risks. It discusses various institutional barriers that may ultimately prevent regional organizations from facilitating regional mediation or fostering interstate conciliation. The chapter provides a solution-oriented analysis – canvassing the GCC, Arab League and OIC experiences – in order to identify how, where, and why obstacles surfaced, before offering a list of general recommendations to steer regional organization approaches to intra-regional blockades in the future.