meta-creation_date: 31/12/2003 10:00:00 Two events on 1 January point to a decade of turbulent changes in the global trading system. First, a birth: Hong Kong and China form a free-trade area, bringing the wealthy territory into an ecomomic union with China more than a century and half afterit was claimed by Britain during the colonial wars of the 19th Century. According to the “Financial Times”:http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/FullStory&c=StoryFT&cid=1071251831502&p=10450509464 bq. The Closer Economic Partnership Arrangement was devised by China to bolster Hong Kong’s battered economy after a prolonged downturn, exacerbated earlier this year by the outbreak of severe acute respiratory syndrome. Second: an anniversary. The North American Free Trade Agreement (NAFTA) is ten-years old. As “Tyler Cowen”:http://www.marginalrevolution.com/marginalrevolution/2003/12/10th_anniversar.html points out bq. NAFTA was far from a perfect treaty, but let us offer three cheers in its favor. It may well go down as the most lasting legacy from the Clinton administration. Of the 151 “regional trade agreements” in force, according to WTO, at the end of 2002, 123 or more than 80 percent of them, were created in the decade of the 1990s.
Why this rapid growth? It’s true of RTAs as of unhappy families that each has a distinct history. There does not appear to be a single explanation for their rapid growth. But thw widespread dissatisfaction with progress in breaking down barriers throught the multilateral system in the second half of the 1980s—and a very similar dissatisfation today—seems to explain some of the demand for discriminatory, ‘fast-track’ liberalization agreeements.