Monday, May 12, 2014

Brief History of Regional Trade Agreements (RTAs)

          Today I attended "Regionalism in a Globalized World" at the CSIS here in Washington, DC. Below I've transcribed from the report the history of RTAs:

          Regional trade agreements have been forged for centuries. The first modern-day regional trade agreements were launched in the late-1950’s. But it is since the 1990s that RTAs have spread wildfire-like around the world. The wave started with the formation of sub-regional pacts, such as Southern Common Market (MERCOSUR) forged in 1991 between Argentina, Brazil, Paraguay, and Uruguay; the consolidation of the European Union, including the launch of the Single Market in 1993, and deepening the Association of Southeast Asian Nations (ASEAN) throughout the 1990s, and, perhaps most notably, the 1994 formation of the North American Free Trade Agreement (NAFTA) among the United States, Canada and Mexico.
          Bloc formation was followed by prolific bilateralism. The EU forged numerous FTAs with Eastern European to-be EU members, while the United States negotiated FTAs with Chile and Central America, and Latin American countries signed agreements with each other. The RTA wave subsequently engulfed Asia. The latest RTAs are transcontinental, with such partners as United States and Morocco, Mexico and Japan, and Chile and the European Union having formed bilateral agreements, among numerous others.
          Up until the 1990s reticent to form preferential agreements, the United States has become one of the most prolific integrators, signing 14 agreements in little over a decade with partners in the Americas, Asia, and the Middle East, and currently pursuing the rather ambitious Trans-Pacific Partnership agreement with several Pacific Rim nations. Other particularly keen integrators include Mexico, Chile, Peru, Singapore, Canada, and the European Union.
          Not only have integration schemes mushroomed; their content has become more complex and encompassing. Most agreements go beyond market access in goods to address trade in services and so-called behind-the-border issues, such as investment, intellectual property rights, competition policy, and government procurement, and e-commerce. RTAs come in many flavors, but they also have clustered into distinct “families”, particularly around key trading nations such as the United States, European Union, and Singapore. US agreements and the many agreements tailored after them in the Americas are particularly encompassing, as are EU’s agreements. Some sub-regional from macroeconomic cooperation to labor mobility and coordination of members’ positions in multilateral trade negotiations.

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