Friday, January 8, 2010

Free Trade in 2010

As the United States dithers, East Asia has moved forward on market liberalization with a vengeance, creating the biggest free trade zones seen in years.

Largely ignored, the arrival of the world's third-biggest free trade area has been formed.

  • China and Asia's Tigers -- the Association of Southeast Asian Nations, scrapped 7,000 different tariffs to form a $200 billion open market for about 2 billion consumers, one-third of the world's population.
  • Jan. 1 also heralded another ASEAN free-trade pact with mighty India, ending tariffs on 4,000 products staggered through 2016; this deal will expand a $50 billion market for 1.5 billion consumers into something even bigger.
  • ASEAN also signed off on free trade with Australia and New Zealand, tacking on another $50 billion market to expand for their 600 million consumers.
  • It follows ASEAN's Dec. 1 agreement with Japan, which created a $240 billion market for 670 million.
  • In addition, Thailand and South Korea completed the last step of 2007's ASEAN-Korea pact, finalizing expansion of the zone to a $72 billion market for 600 million.

ASEAN's six freest members, Thailand, Indonesia, Singapore, Philippines, Malaysia and Brunei , even enacted a free-trade deal among themselves on Jan. 1, ending tariffs on goods sold to each other, freeing a $60 billion market for 500 million consumers.

All this points to something major: While the Obama administration has put its energy into trade wars with China, enacting punitive tariffs on steel, tires, nylon, paper, and other goods and has signed no new pacts in 2009, free trade is marching on without the United States

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