Monday, January 11, 2010

Major Free Trade Deals in 2009: Asia = 8, USA = 0

According to Investor's Business Daily, the following trade deals were recently announced in December 2009 and early January:

1.
China and Asia's Tigers — the Association of Southeast Asian Nations (ASEAN) — scrapped 7,000 different tariffs to form a $200 billion open market for about 2 billion consumers, one-third of the world's population.

2. ASEAN (Brunei, Cambodia, Indonesia, Laos, Malaysia, Phillipines, Singapore, Thailand) signed a 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.

3.
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.

4.
ASEAN signed an agreement with Japan on December 1, which created a $240 billion market for 670 million.

5.
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.

6.
ASEAN's six freest members — Thailand, Indonesia, Singapore, Philippines, Malaysia, Brunei — 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.

7.
India announced that three years of talks with South Korea were complete, uniting the third- and fourth-largest economies in the Far East.

8.
India's leaders said a one-year deadline for negotiating a pact with the European Union was set.

In contrast, the number of major trade pacts signed by the U.S. in 2008 and 2009: NONE

More from the IBD:

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 U.S.

It underlines the sorry state of affairs going on under the radar with the U.S. on trade. While the Obama administration stalled on three free-trade pacts with Colombia, Panama and South Korea, and enacted protectionist moves like "Buy American" provisos in state contracts, other countries moved on without us.

Unlike the Obama administration, Asian states don't see trade as some party favor to be doled out or withheld for special interest groups for political purposes. It's not without risk, but they see trade as a critical element to secure long-term economic growth.

With subpar growth forecast in the U.S. in the next decade, and unemployment at 10%, it's likely a closed economy that hasn't seen a new free trade pact since 2007 is a key reason. The Asian tiger example ought to be a major spur to get going. Nations that value free trade above politics aren't waiting around.

13 Comments:

At 1/11/2010 5:12 PM, Anonymous Benny The Man said...

The world is passing the USA by. Non-Islamic Asia is in an industrial mobilization mode, while the USA is in a military mobilization mode.

We also pour $60 billion a year into farming subsidies.

Well, we will excel at the two of the four oldest trades known to man: war and agriculture.

We probably could do well at prostitution and hunting too.

High-tech manufacturing? See you in Asia.

 
At 1/11/2010 5:40 PM, Anonymous Anonymous said...

It's the Chicago way.

 
At 1/11/2010 6:07 PM, Anonymous geoih said...

How about this for a free trade deal? Get rid of all the tariffs on products coming into the US. Shazam! Free trade!

 
At 1/11/2010 7:51 PM, Anonymous Anonymous said...

High-tech manufacturing? See you in Asia.

Yeah, yeah, the Chinese are taking over. Just like the Japanese were going to take over in the '80's. The truth is that U.S. manufacturing output has been growing, as have U.S. exports. If China were, in fact, destroying our industrial base, how could this happen:

In the 12 months ending January 2008, U.S. exports of goods and services grew by 13.1% to $1,649 billion compared to the 12 month period ending January 2007 ... Exports comprised 12.3% of U.S. GDP in the fourth quarter of 2007. To put this in historical terms, exports were only 9.6% of U.S. GDP five years earlier (Q4 2002), and 5.1% 40 years ago (Q4 1967) ... U.S. manufacturing output rose by 58 percent between 1993 and 2006 ...

U.S. Commerce Dept.

 
At 1/11/2010 7:57 PM, Anonymous Anonymous said...

How about this for a free trade deal? Get rid of all the tariffs on products coming into the US.



That is essentially the trade arrangement we have with Columbia right now. The free trade pact would actually result in lower tariffs on U.S. exports to Columbia. The only reason it hasn't been signed is Democrat support for Columbian trade unions and the communist guerillas terrorizing the country.

 
At 1/11/2010 8:10 PM, Anonymous Anonymous said...

According to the United States Trade Representative the U.S. has a Free for the taking arrangement with China:

" U.S. Industry estimates that levels of piracy in China accross most lines of copyright products for the recording/music industry remains at 90% for 2008, while business software piracy rates were approximately 80%."

The hope and promise for U.S. competitiveness is intellectual property. The only problem is that it is viewed as FREE in China.

BTW to anon. U.S. manufacturing output grew mainly by incorporating foreign components in the final product.

 
At 1/11/2010 8:23 PM, Anonymous Anonymous said...

U.S. manufacturing output grew mainly by incorporating foreign components in the final product.

Bullshit.

 
At 1/11/2010 8:57 PM, Anonymous Anonymous said...

Yes my fellow anon., B.S. I call on U.S. Manufacturing output. Only building industry manufacturing is domestic content. Look at any product from Boeing jets to lawn mowers and you will see foreign content makes up most of the finished product.

The only exception is defense but that will change as the U.S. spirals down with production capabilities.

 
At 1/11/2010 11:50 PM, Anonymous Anonymous said...

... as the U.S. spirals down with production capabilities.

Yeah, yeah, yeah. The U.S. is always "spiraling down". Yet, somehow, we always wind up on top.

Next you'll be telling us how great Cuba's health care is.

 
At 1/12/2010 6:41 AM, Blogger juandos said...

"Non-Islamic Asia is in an industrial mobilization mode"...

Hmmm, from CNN (for what that's worth dated March 31, '09: The Asian Development Outlook 2009 forecasts that economic growth in developing Asia will slip to 3.4 percent in 2009, down from 6.3 percent last year and 9.5 percent in 2007. Growth could improve to 6 percent in 2010, if the global economy experiences a mild recovery next year, the report says...

BUT!

India’s Industrial Production Rises Most in 25 Months

Last Updated: January 12, 2010 05:27 EST

'Economies are recovering across Asia after the region’s policy makers unveiled about $1 trillion in stimulus measures and cut rates to spur growth. China’s industrial production rose 19.2 percent in November and its exports climbed 17.7 percent in December"...

 
At 1/12/2010 5:06 PM, Blogger sethstorm said...

It's not our job to prop up unstable, despotic countries.

Nor should be be selling our sovereignty to them.

 
At 1/13/2010 6:45 PM, Anonymous Mr. Econotarian said...

" U.S. Industry estimates that levels of piracy in China accross most lines of copyright products for the recording/music industry remains at 90% for 2008, while business software piracy rates were approximately 80%."

That said, Avatar has done over $45 million box-office in China so far...

 
At 1/13/2010 7:01 PM, Anonymous skytrain said...

to sethstorm, etal--you don't mean countries like iraq and afghanistan, do you? or cuba.....

 

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