Trade Minister Tim Groser has signed a Free Trade Agreement with 10 Asian nations.
They are Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei, Vietnam, Laos, Myanmar and Cambodia and these 10 members of ASEAN – Association of South East Asian Nations - have a total population of more than 500 million which is a big market for New Zealand produce.
While applauding this I do wonder about the time, effort and expense involved in these sorts of agreements when the greater good would be better served by world-wide free trade.
Given the slow progress of the WTO I realise that it’s important to keep working on these smaller deals which may well be stepping stones to the big goal of full free and fair trade.
That will only come when all the protectionist barriers are dismantled so all countries open their borders to allow trade with all other countries. If there’s a silver lining to the GFC it might just be that more countries find they can no longer afford subsidies and other anti-competitive measures.
The problem may be bigger than you think, Preferential Trade Agreements (PTAs) may undermine free trade. Jagdish Bhagwati argues this in his book “Termites in the Trading System: How Preferential Agreements Undermine Free Trade”. I give short introduction to the idea here.