Free trade agreements are the future of world trade

 

If Britain withdrew from the EU, far from being isolated, it would enjoy the same status as many other countries.

 

By

 

Ian Milne

 

 

 

 

British europhiles customarily disparage the idea that the UK could profitably swap the EU Customs Union? Single Market for, say, NAFTA the North American Free Trade Agreement.

 

On the Continent, especially in France, the phrase “free trade”, and by extension “free trade zone”, is regarded with contempt, whether you’re on the left or right of the spectrum.

 

However, when Lord Pearson of Rannoch asked HM Government which non-EU countries the EU had Free Trade Agreements (FTAs) with, and which non-EU countries it was negotiating FTAs with the answer delivered by Baroness Symons on 5^th July*, was unexpectedly long, filling almost a whole page in Hansard as she reeled off lists of countries from Albania to Zambia.

 

It turns out that EU countries trade now with 22 non-EU countries via FTAs, and is currently negotiating FTAs with another 69. That makes 91 in total – just about half the countries in the world.

So if, on withdrawal, the UK decided it would be in its interests to have an FTA with the EU, far from being “isolated”; it would be in the same situation as literally dozens of countries.

 

The EU’s not the only RTA-Regional Trade Association- to be enthusiastically negotiating FTAs around the globe.  EFTA, the European Free Trade Association, of which the UK was a founder member but which had to withdraw from when it joined the “Common Market”  (with disastrous results) in 1973, is also at it.

 

EFTA, whose current members are Norway, Switzerland, Iceland and Liechtenstein, and which is far wealthier than almost all the EU countries, has 13 FTAs in force at the present and is negotiating FTAs with another 9.  It has also announced its intention to enter into FTAs with a further 26 countries (including the USA Japan, China, and Russia) making a total, if they all come off of 48.

 

Building on Success

 

Meanwhile, the USA, building on the success of NAFTA (Canada, the USA and Mexico), has signed 15 FTAs and is negotiating or has announced its intention to negotiate FTAs with 11 countries, making 26 in total. By 2005 it plans to complete negotiations on the Free Trade Area of the Americas (FTAA), creating a 34-country free trade zone of 800 million people stretching from Alaska to Tierra del Fuego.

 

In addition, the US-Middle East Trade Initiative announced a few months ago by President Bush will involve setting up bilateral FTAs with each Middle East country, the aim being to consolidate them all into a multilateral agreement by 2013.

 

Both FTAs (where each participant keeps control of its own trade policy) and customs unions (where each participant abandons control of its own trade policy, adopts a common external tariff and accepts whatever trade policy the customs union decides) have to be notified to the World Trade Organisation (WTO), which monitors them for non-discrimination against third parties and other unfair practices.

 

Of the 243 RTAs in force in March 2002, reports the WTO, 175 were FTAs (72 per cent of the total); only 22 were customs unions (9 per cent of the total). The remainder were categorised as “partial scope” agreements. 

 

Apart from the EU, most customs unions involve poor developing countries in Africa, the countries that were formerly part of the Soviet Union, a few developing South American countries and the Gulf statelets.

 

  Outside Europe, no major-league industrial trading nation-not the USA, not Japan, not South Korea, not Singapore, not China, not Australia, not Chile – has chosen to conduct its trade via Custom Unions.

 

If the EU model of conducting trade-via a tightly-regulated customs union with a Commission, Parliament, Court of Justice, acquis communautaire etc –etc-is so marvellous, why have no other advanced countries sought to emulate it?

One explanation is that having seen the EU model n action in succeeding WTO negotiating “rounds” (the latest one being the failed session in Cancun), with all its shenanigans and poor economic performance, they’ve simply concluded” 

 

“Thanks, but no thanks”.

[And]

Who can blame them?

 

*Hansard, House of Lords, 5^th July 2004, Col WA 63-65, HL3440 &HL3441

 

eurofacts  the 30^th July 2004 – Vol 9 No20/21

 

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www.speakout.co.uk

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Daniel Hannan - Forming an OPPOSITION to the EU

www.telegraph.co.uk.blogs

 

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VOTE

MAY -2007

 

TO LEAVE THE EUROPEAN UNION

WITH THE ONLY PARTY WITH A MANDATE

TO SET YOU

 FREE

 

THE

UK INDEPENDENCE PARTY

www.ukip.org

 

TO RECLAIM YOUR DEMOCRACY DON'T VOTE FOR THE TRIPARTITE PARTIES IN WESTMINSTER

BUT

SMALL PARTIES THAT SPEAK THEIR MINDS WITHOUT SPIN AND LIES.

*

 

ONLY

PRO-PORTIONAL REPRESENTATION

WILL BRING DEMOCRACY BACK TO THE ENGLISH PEOPLE

*

Home Rule for Scotland

WHY NOT

HOME RULE for ENGLAND

 

*

MAY/07

 

[All underlined words have a separate bulletin

THE QUESTION THAT THE VOTER MUST ANSWER

 

‘DO YOU WISH TO BE GOVERNED BY YOUR OWN PEOPLE, LAW AND CUSTOM OR BY THE CORRUPT ,EXPENSIVE UNACCOUNTABLE AND ALIEN BUSYBODY BRUSSELS’

 

-SIMPLE IS IT NOT?