Major multilateral free trade agreements – existing, proposed and in doubt in the era of the Trump Presidency – compiled by Geoff Kitney.
Doha Development Round of World Trade Negotiations |
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164 countries involved, covering 95 per cent of world trade. Negotiations commenced in November 2001. Negotiations stalled in July 2008 over objections by developing countries – especially India and China – to provisions on agriculture and industrial goods. |
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| Goal: |
To replace the Uruguay Round Agreement (currently the world’s most comprehensive multilateral trade agreement). Intended to extend and expand the global liberalisation of trade by removing global tariff and non-tariff barriers to trade in industrial goods, services, intellectual property and agriculture. |
| Current status: | Indefinitely delayed. With the Trump administration opposed to multilateral trade deals, Doha appears dead. |
European Single Market |
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| Involves all 28 members of the European Union and is the basis on which the EU operates, allowing free movement of goods, services, capital and people between member nations. | |
| Goal: |
To create a borderless Europe to facilitate trade to create a zone of shared prosperity, free of strident nationalism. |
| Current status: | Following the Brexit vote in the United Kingdom, which is likely to see the UK leave the single market at the end of two years of Brexit negotiations, EU member states have declared their intention to maintain and strengthen the Single Market. But risks remain from growing opposition to open borders within the EU. Forthcoming elections in France, Italy and the Netherlands will pose challenges. |
RCEP (Regional Comprehensive Economic Partnership) |
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Sixteen countries involved covering most of the Asian region (China, Japan, India, South Korea, Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei, Vietnam, Laos, Myanmar, Cambodia, Australia and New Zealand. Negotiations commenced in November 2012, originally with the limited aim of creating an umbrella agreement for existing agreements. |
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| Goal: |
Originally proposed to be an agreement covering trade in goods, services, investment and economic and technical co-operation. |
| Current status: |
Best hope for a major multilateral trade agreement in the Trump era. China has increasingly been asserting its influence within RCEP, promoting it as an alternative to the Trans Pacific Partnership. With the US withdrawing from the TPP and effectively ending it, China is lobbying for RCEP to be a substitute for the TPP, which could make it the main vehicle for China to advance its economic and strategic influence compared to the US. |
TPP (Trans Pacific Partnership) |
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12 countries agreed to the TPP agreement, covering 40 per cent of global trade (the US, Japan, Canada, Australia, Mexico, Chile, Malaysia, New Zealand, Peru, Vietnam, Singapore and Brunei) Negotiations commenced in January 2008. Agreement signed in February 2016. |
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| Goal: |
To remove barriers to trade in all markets and to introduce rules for liberalising intellectual property rights. |
| Current status: | President Trump has withdrawn the US from the TPP. Other members are trying to salvage a “12 minus one” agreement, but major players such as Japan say they see no point in an agreement which does not include the US. TPP appears dead on arrival. |
TTIP (Trans Atlantic Trade and Investment Agreement) |
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A proposed free trade area covering the European Union and the United States, estimated to be worth €120 billion to the EU and $90bn to the US, an estimated 50 per cent increase in total EU-US trade. Negotiations commenced in February 2013. Negotiations are conducted in secret. |
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| Goal: |
To increase market access, to streamline regulations and to provide clear rules to allow greater sharing of intellectual property. |
| Current status: | Negotiations are proceeding but are almost certain to be suspended indefinitely in light of the Trump administration’s hostility to multilateralism and towards the EU itself. |
EU-China investment agreement |
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To cover economic relations between China and all European Union countries, estimated to be worth €1bn a day in trade, investment and other service industries such as tourism and education (China is now the EU’s biggest trading partner). Negotiations commenced in January 2014. |
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| Goal: |
To remove barriers and to establish clear rules for facilitating a deeper economic relationship and to lay foundations for a full bilateral free trade agreement (FTA). |
| Current status: | Negotiations on an investment agreement are continuing. Once completed, negotiations on a full FTA are expected to commence. May have better prospects of success in light of China’s aim to become a lead power promoting free trade and multilateralism. |
NAFTA (North American Free Trade Agreement) |
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An agreement between the United States, Canada and Mexico. Came into force in 1994, amid predictions of huge economic benefits for all three countries. |
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| Goal: |
To eliminate barriers to trade and investment in the north American nations. |
| Current status: | In serious jeopardy. President Trump has ordered a review of NAFTA and is highly critical of it as “unfair” to the United States. Before Trump, NAFTA was generally seen as having delivered less than promised. Blamed in the US for allowing the exporting of American manufacturing jobs to Mexico. Criticised in Canada for giving big American corporations excessive powers. |
CETA (Comprehensive Economic and Trade Agreement) |
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| A free trade agreement between the European Union and Canada. | |
| Goal: |
To remove 98 per cent of trade barriers between the EU and Canada. EU claims it will lead to savings of over €500m a year in taxes on exports to Canada, plus greatly increased market access for both countries. Negotiations commenced in May 2009. The deal was signed by Canada in October 2016. It now has to be ratified by all EU member states. |
| Current status: | In the wake of President Trump’s push against NAFTA and multilateral trade agreements, the EU and Canada can be expected to increase their resolve to make CETA a success. Will come into operation once EU ratification process in completed. |
EEAA (European Economic Area Agreement) |
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An access to the single market agreement involving 28 EU member states and three non-EU countries (Norway, Iceland and Liechtenstein). Came into effect in 1994. |
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| Goal: |
To allow countries neighbouring the EU to trade and gain access to the benefits of the single market without becoming full EU members. |
| Current status: |
Allows the free movement of goods, services, capital and people between the European single market and the non-EU states. Seen by the some analysts in the United Kingdom as a possible model for a similar agreement between the UK and the EU post-Brexit. But the UK government’s decision to go for a “hard Brexit” means the UK will leave the single market and will seek a separate Free Trade Agreement with the EU. |
Other US Trade Agreements |
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| The US currently has 14 FTAs with 20 countries: A Latin American agreement covering six countries, a South American agreement covering six countries, a Middle East agreement covering five countries and bilateral trade agreements with Australia, South Korea and Singapore. | |
| Goal: | Various |
| Current status: | More than 47 per cent of US exports go to these countries. The Trump administration has indicated all trade agreements will be reviewed to assess whether they disadvantage the United States. |
New US FTA priorities
The Trump administration has signalled that it wants to replace multilateral and regional free trade agreements with bilateral agreements that maximise value to the US. Trump has listed the UK and Japan as top of the list for bilateral trade deals. He has also indicated an intention to renegotiate bilateral FTA’s with Australia and South Korea.
