Are non-tariff measures a substitute for tariffs in agricultural trade? Recent evidence from southern Mediterranean countries

The significance of and interest in non-tariff measures (NTMs) have increased as a consequence of the reduction in agricultural tariffs. This paper analyses the relationship between NTMs and tariffs in southern Mediterranean countries (SMCs) through two complementary analyses. First, the authors construct a taxonomy of protection for products, distinguishing between high protection, transparent protection, low protection and disguised protection. The low protection category is most widely represented, and the disguised protection category is also important. Second, the policy substitution hypothesis between tariff and non-tariff protection is tested. This hypothesis appears in the literature as the possibility that countries implement NTMs for protection purposes, as a result of the progressive reduction in the tariffs levied. Policy substitution is found in some SMCs, which is consistent with an upward trend of non-tariff protection as tariff liberalization progresses in the region.