M-RCBG Associate Working Paper No. 115
Regulatory Cooperation -- A Reality Check
Regulatory cooperation is seen as an effective way to foster further trade liberalization and reduce unnecessary red tape in international exchange. The European Union Single Market shows the benefits of such cooperation, contributing to an estimated 8.5% of EU GDP. Through Association Agreements, EU neighbors have aligned with EU law to access the EU market. Yet, despite impressive estimates of potential benefits, other trading partners have set a low level of ambition for regulatory cooperation and the benefits have been modest thus far. Given that regulatory cooperation is a long-haul exercise and that the EU Free Trade Agreements with regulatory cooperation provisions have only recently gone into force, the full potential of regulatory cooperation may only be seen in coming years.